wp 5.5 - renewables meeting 18-1… · 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028...

WP 5.5 - RenewablesDevelopment and application of

specific tools for energy security inthe renewable energy sector

Christian Panzer (TU Vienna - EEG)Anne Held (Fraunhofer ISI)

SECURE Workshop – Milan, January 18th, 2010

Outline

1. Overview

2. Preliminary results

� Characteristics of RES

� Potentials and future pathways of RES and their contribution to Security of Supply in the EU

3. Implications for security of energy supply

Overview of WP 5.5 - Renewables

• Partners: Fraunhofer ISI (lead), TU Vienna, FEEM, Ramboll, ERSE

• Duration: Month 9 – Month 24 � Start December 2008

Overview of RES-characteristics

Potential impact of RES on the security of supply

Costs of RES-measures and policy support

General risks and opportunities of RES

Summary and Conclusions

1st Deliverable

2nd Deliverable

3rd Deliverable

Characteristics of RES – Policy background

Characterization of currently applied policy measures in the EU:

- 19 Member States apply Feed-In Tariffs in the electricity sector- 6 Member States apply a quota system- The heat sector is mostly dominated by investment incentives

Direct Indirect

Price-driven Quantity-driven

• Investment incentives

Investment

focused

• Tax credits • Low interest / Soft loans

• Tendering system for investment

grant

Regulatory

Generation

based

• (Fixed) Feed- in tariffs

• Fixed Premium system

• Production tax incentives

• Tendering system for long term contracts

• Tradable Green Certificate system

• Environmental taxes

• Simplification of • Connexion charges,

balancing costs

• Shareholder Programs

Investment

focused

• Contribution Programs

Voluntary

Generation

based

• Green tariffs

• Voluntary agreements

Feed-in tariffs

Quota obligation

Tax and investment incentives

SE

FI

EELA

LT

PL

CZSK

BL

ROHUAT

DE

DK

UKIE

ESPTIT

MTCY

GR

SIFR

NLBE

LU

SE

FI

EELA

LT

PL

CZSK

BL

ROHUAT

DE

DK

UKIE

ESPTIT

MTCY

GR

SIFR

NLBE

LU

Characteristics of RES – RES development total

Historic RES development in terms of gross final energy:

- Heat sector still dominates the RES contribution (57%)- 38% renewable energy is generated in the electricity sector- Transport sector plays a marginal role at a recently increasing share- Generally, RES contributed to 9.7 % of gross final energy demand in 2007

0%1%2%3%4%5%6%7%8%9%10%

0

20

40

60

80

100

120

140

19

90

19

91

19

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

RE

S-s

hare

in fi

nal e

nerg

y co

nsum

ptio

n

Fin

al e

nerg

y ba

sed

on R

ES

[k

toe/

a]

Transport Production Electricity Generation Heat Production RES-Total Final Share

[Mto

e/a]

05

101520253035404550

1990 1992 1994 1996 1998 2000 2002 2004 2006

Ele

ctri

city

gen

erat

ion

[Mto

e/a

]

'New' RES-E excl. hydro Small-scale hydro Large-scale hydro

Historic RES development on sectoral level:

0

1234

567

89

10

1990 1995 2000 2005

Bio

fuel

con

sum

ptio

n [M

toe/

a]

0

10

20

30

40

50

60

70

1990 1995 2000 2005

Hea

t Gen

erat

ion

[Mto

e/ye

ar]

Solarthermal Geothermal Biomass

Characteristics of RES – RES development on sectoral basis

� Dominance of biomass energy in heat sector

� Strong growth in the transport sector at comparatively low level

� Broader technology portfolio in the electricity sector

Heat Transport

Electricity

Characteristics of RES – Economic characterisation

30%35%40%45%50%55%60%65%70%75%80%85%90%95%

100%105%110%115%120%

200

6

200

8

201

0

201

2

201

4

201

6

201

8

202

0

202

2

202

4

202

6

202

8

203

0Cos

t red

uctio

n -

shar

e of

initi

al

inve

stm

ent

(as

in t

he y

ear

2006

)

Hydropower

Geothermal electricity

Solid biomass - cofiring & large-scale plant Solid biomass - small-scale CHPGaseous biomass

Gaseous biomass CHP

Wind energy

Tidal & wave

Solar thermal electricity

Photovoltaics

0 50 100 150 200

Biomass - district heat

Geothermal - district heat

Biomass (non-grid) - log wood

Biomass (non-grid) - wood chips

Biomass (non-grid) - pellets

Heat pumps

Solar thermal heat & hot water

Costs of heat (LRMC - Payback time: 15 years) [€/MWh]

Mar

ketp

rice

in 2

006

(non

-grid

)

Mar

ketp

rice

in 2

006

(grid

)

0 50 100 150 200

Biogas

(Solid) Biomass co-firing

(Solid) Biomass

Biowaste


Hydro large-scale

Hydro small-scale

Photovoltaics


Tide & Wave

Wind onshore

Wind offshore

Costs of electricity (LRMC - Payback time: 15 years) [€/MWh]

Ele

ctric

ity M

arke

t P

rice

in 2

006

PV: 430 to 1640 €/MWh →

TransportHeat Electricity

Characteristics of RES – Identification of risks

Risk of RES technologies:

• Hydro: Changing utilisation

• Wind: Impact of storms• Biomass: Change in BM-Potential

• Development of cost reduction

• Raw material prices (e.g. steel, silicon)

• Electricity generation costs

• CSP from North Africa• Biomass imports (transport distance, state of aggregation)

• Biomass availability and prices

• Harvesting season

Long-term impacts Operational impacts

EconomicClimate change impacts

Feedstock competition

Import dependency

• Wind in particular on short-term(Remedies: Back-up capacity; Grid reinforcement; DSM)

• Solar (comparatively good correlation of peak load and demand)

• Hydro (Inter-annual variability)

Variability of RES-output

• Geothermal (Hot-Dry-Rock and Earthquakes �Basel)

Technological risks

Others

• Political factors hampering RES-development (Non-economic barriers, policy uncertainty)

Political risks

Identification of risks – The Spanish case

Situation:•High share of CCGT

•High share of RES, in particular hydropower and wind

•Legal differentiation between large centralised and small decentralised power plants (Ordinary Regime vs. Special Regime)

•Phasing-out of nuclear power plants foreseen after end of lifetime is achieved


Hydropower at the Iberian Peninsular (1/2)

Situation:Hydropower plants are concentrated on a few rivers

Iberian Peninsula

France

Morocco400 MW

1000 MW

400 MW

1400 MW

Regarded CountryNeighbouring CountryNet Export Transfer CapacitiesNet Import Transfer Capacities

Limited cross-border transmission capacities


Major Drought Major Drought

Hydropower at the Iberian Peninsular (2/2)

Management of drought periods:• Import capacity of electricity restricted

• Stronger use of conventional power, in particular by CCGT


Wind electricityWind Power Production Record

Record wind power feed-inWind power provides 53% of electricity demand in the morning hours of November 8, 2009 (Sunday)

�Reactions• Reduction of CCGT-output

• Electricity exports (85% of capacity)

• Charging of pump-storage power plants (38% of capacity)

Characteristics of RES – Identification of opportuni ties

Opportunity to increase Security of Supply due to RES:

� Estimation of the future contribution of RES to increasing Security of Supply in the EU by means of scenario analysis with Green-X

• Reduction of import dependency

• Location closed to demand � Less infrastructure risk

• Reduced impact on electricity system in case of shutdowns

• Reduction of price risks induced by fossil fuel prices

• Price effect of wind power feed-in

• Diversification of power plant portfolio

Decentralised character

Mainly indigenous resources

No fuel cost (except BM) Portfolio effect

Outline – Scenario analysis with Green-X

1. Introduction and background information

2. Methodology and assumptions

3. RES deployment according to policy storylines

� In terms of generation

� In terms of corresponding costs

4. Sensitivity cases

5. Conclusions

How the European Commission set the targets … „FLAT RATE“ & „GDP-Variation“

… i.e.: RES-target2020 = RES2005% + 50% *RESNEW % + 50%*“RESNEW % GDP-weighting“-“first mover bonus“

National RES targets for 2020 the proposed definiti on

Note: Additional potentials do not include biofuel imports

0%

10%

20%

30%

40%

50%

60%

70%

80%

AT

BE

BG

CY

CZ

DK

EE FI

FR

DE

GR

HU IE IT LA LT LU MT

NL

PL

PT

RO SK SI

ES

SE

UK

EU

27

RE

S in

term

s of

fina

l ene

rgy

[% o

f dem

and]

RES potential 2020 - share on current (2005) demand

Proposed RES target for 2020

RES share 2005

The core objective of the project Green-X was to develop a computer model allowing an assessment of

the future deployment of RES in the ‘real world’.

Derived objectives are:

to describe the potential & the accompanying cost of the various RES-E options in a brief and suitable manner for

model implementation;

to model the impact of policy instruments;

to address dynamic aspects in a proper way, including:

− Future technological changes – e.g. a reduction of investment costs or efficiency improvements

due to technological learning

− Technology diffusion – i.e. the impact of non-economic barriers for RES-E

… to derive a picture of a likely future as close as possible to reality …

The The GreenGreen--XX modelmodel

Reference clients: European Commission (DG RESEARCH, DG TREN, DG ENV), Sustainable Energy Ireland, German Ministry for Environment, European Environmental Agency, Consultation to Ministries in Serbia, Luxembourg, Morocco, etc.

Simulation model for energy policy instruments in the European energy market

•RES-E, RES-H, RES-T and CHP, conventional power•Based on the concept of dynamic cost-resource curves•Allowing forecasts up to 2020/2030 on national / EU-27 level

The The GreenGreen--XX modelmodel

Base input information

Scenario Information

Power generation

(Access Database)

Policy strategies selection

Social behaviourInvestor/consumer

Externalities

Framework Conditions

(Access Database)

Results Costs and Benefits on a yearly basis (2005-2020 )

Country selection

Electricity demand reduction (Access Database)

Technology selection

Economicmarket and policy

assessmentpotential, costs,

offer prices

Simulation of market interactionsRES-E, CHP, DSM power market, EUAs

Base input information

Scenario Information

Power generation

(Access Database)

Policy strategies selection

Social behaviourInvestor/consumer

Externalities

Framework Conditions

(Access Database)

Results Costs and Benefits on a yearly basis (2006 -2030 )

Country selection

Electricity demand reduction (Access Database)

Technology selection

Economicmarket and policy

assessmentpotential, costs,

offer prices

Simulation of market interactionsRES, CHP, DSM

power market, EUAs

Energy demand projections derived from POLES

-

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

2005 2010 2015 2020 2025 2030

Gro

ss fi

nal

ele

ctric

ity d

ema

nd [

TW

h]

Global Regime - Full Trade

Europe Alone

Muddling Through

-

2.000

4.000

6.000

8.000

10.000

12.000

14.000

16.000

2005 2010 2015 2020 2025 2030

Tot

al fi

nal e

nerg

y de

man

d [T

Wh]

Global Regime - Full Trade

Europe Alone

Muddling Through

Energy demands for all scenarios are taken from the POLES scenarios, but had to be adjusted(reduced) due to statistical accounting methodologies in order to consider the European Directive of 20% RES in 2020 on gross final energy demand correctly!

Primary energy prices and CO2 prices – derived from POLES

0

5

10

15

20

25

30

35

40

45

2005 2010 2015 2020 2025 2030

prim

ary

ene

rgy

pric

es [

€/M

Wh]

Oil Natural gas Coal

2005 2010 2015 2020 2025 2030Muddling Through €/t 0,00 7,94 11,90 15,86 19,83 23,79Europe Alone €/t 0,00 7,75 18,62 45,05 66,71 88,51Global Regime - Full Trade €/t 0,00 6,96 12,99 26,01 45,70 62,02

CO2 prices

Relatively low primary energy prices for all scenarios, with strongly varying CO2 prices in the different policy storylines

Barriers (non-economic)

Definition of potential terms

Theoretical potential ... based on the determination of the energy flow.

Technical potential … based on technical boundary conditions (i.e. efficiencies of conversion technologies, overall technical

limitations as e.g. the available land area to install wind turbines)

Realisable potential …

The realisable potential represents the maximal

achievable potential assuming that all existing barriers can be overcome and all driving forces are

active. Thereby, general

parameters as e.g. market growth rates, planning

constraints are taken into account in a dynamic context

– i.e. the realisable potential has to refer to a

certain year.

AdditionalAdditionalrealisablerealisablemidmid --term term potential potential (up to 2020)(up to 2020)

2000 2005 2010 2015

Historical deployment

Theoretical potential

Ene

rgy

gene

ratio

n

Economic Potential(without additional support)

Technical potential R&D

2020

Policy, Society

Achieved Achieved potential potential (2005)(2005)

Maximal time-path for penetration (Realisable Potential)

Long-term potential

Mid-term potential

Definition of the (additional) realisable mid-term potential (up to 2020)

Key parameter:

Derived from FORRES 2020 & follow-upprojects

►RES potentials

RES potentials – Total energy sector

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

AT

BE

BG

CY

CZ

DK

EE FI

FR

DE

GR

HU IE IT LA LT LU

MT

NL

PL

PT

RO

SK SI

ES

SE

UK

EU

27

RE

S in

term

s of

fina

l ene

rgy

[% o

f dem

and]

RES share 2005RES long term (2030) potential - share on 2030 demand (MT)RES long term (2030) potential - share on 2030 demand (GR-FT)RES long term (2030) potential - share on current ( 2005) demand

0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20%

RES-electricity

RES-heat

Biofuels for transport

RES in terms of final energy [% of demand]

Achieved potential 2005Additional long term (2030) potential

Key parameter:


►RES potentials

RES potentials – Electricity sector

0%

25%

50%

75%

100%

125%

150%

175%

200%

AT

BE

BG

CY CZ

DK EE FI

FR

DE

GR

HU IE IT LA LT LU

MT

NL

PL

PT

RO SK SI

ES

SE

UK

EU

27

RE

S-E

- E

lect

rici

ty g

ener

atio

n po

tent

ial

[% o

f gro

ss e

lect

ricity

de

man

d]


0 50 100 150 200 250 300 350 400 450 500

Biogas

(Solid) Biomass

Biowaste


Hydro large-scale

Hydro small-scale

Photovoltaics


Tide & Wave

Wind onshore

Wind offshore

RES-E - Electricity generation potential [TWh]

Achieved potential 2005Additional long term (2030) potential

Key parameter:


►RES potentials

RES potentials – Heat sector

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

AT

BE

BG

CY

CZ

DK

EE FI

FR

DE

GR

HU IE IT LA LT

LU MT

NL

PL

PT

RO SK SI

ES

SE

UK

EU

27

RE

S-H

- H

eat g

ener

atio

n po

tent

ial

[% o

f gro

ss h

eat d

eman

d]


0 10 20 30 40 50 60 70

Biomass heat (CHP & DH)

Geothermal heat (CHP & DH)

Biomass heat (decentral)

Heat pumps

Solar collectors

RES-H - Heat generation potential [Mtoe]

Achieved potential 2005

Additional long term (2030)potential

Key parameter:


►RES potentials

RES potentials – Transport sector

0%

10%

20%

30%

40%

50%

60%

70%

80%

AT

BE

BG

CY

CZ

DK

EE FI FR

DE

GR

HU IE IT LA

LT LU MT

NL PL

PT

RO SK SI

ES

SE

UK

EU

27

RE

S-T

- B

iofu

el g

ener

atio

n po

tent

ial

[% o

f gro

ss tr

ansp

ort f

uel d

eman

d]


Three main policy storylines have been investigated:

►Muddling through: Global Baseline RES development

►Europe Alone: Alternative RES development within Europe and baseline RES development in the RoW

►Global Regime: Alternative RES development on global scale

Strengthened national policy: Accelerated RES deployment, assuming that the European RES policy framework will be improved with respect to its efficiency & effectiveness (i.e. strengthened national RES support incl. flexibility mechanism for 2020 national RES target fulfillment). These changes will become effective by 2011 in order to meet the agreed target of 20% RES by 2020 and the ambition is continued beyond 2020. Improvements refer to both the financial support conditions (if necessary) as well as to non-financial barriers (i. e. administrative deficiencies etc.) where a rapid removal is also preconditioned.

With respect to the Global Regime, sensitivity runs are carried out, highlighting the importance of efficient policy measures to be implemented. Consequently technology specific premium tariffs are considered as well as quota systems based on technology neutral Tradable Green Certificates schemes

Scenario definition

Scenario results – Muddling ThroughMuddling Through

26,5%

13,8%

7,0%

13,5%

18,7%

15,5%

0%

5%

10%

15%

20%

25%

30%

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

RE

S-d

eplo

ymen

t - in

rela

tive

term

s (i

.e. a

s sh

are

of c

orre

spon

ding

gr

oss

dem

and)

[%]

RES-electricity

RES-heat

RES-transport

RES primary(EUROSTAT)

RES primary(SUBSTITUTION)

RES-final

2010 2020 2030 2010 2020 2030 2010 2020 2030 2020 2020*

Austria 64% 63% 61% 29% 28% 32% 1% 4% 5% 28,9% 28,9% 34% 85%

Belgium 6% 10% 11% 4% 4% 3% 0% 0% 0% 4,3% 4,3% 13% 33%

Denmark 34% 34% 43% 31% 34% 36% 0% 0% 0% 22,7% 22,7% 30% 76%

Finland 28% 24% 25% 46% 43% 47% 0% 0% 0% 29,4% 29,4% 38% 77%

France 18% 22% 24% 17% 16% 19% 2% 10% 12% 16,2% 16,2% 23% 70%

Germany 14% 15% 13% 6% 7% 10% 1% 7% 7% 8,8% 8,8% 18% 49%

Greece 12% 19% 22% 17% 21% 25% 1% 6% 7% 15,1% 15,1% 18% 84%

Ireland 13% 21% 35% 5% 6% 8% 2% 6% 8% 9,1% 9,1% 16% 57%

Italy 21% 29% 29% 4% 5% 7% 1% 5% 6% 10,3% 10,3% 17% 60%

Luxembourg 4% 4% 4% 2% 2% 4% 1% 3% 6% 2,9% 2,9% 11% 27%

Netherlands 10% 9% 9% 3% 3% 3% 1% 4% 5% 4,6% 4,6% 14% 33%

Portugal 40% 45% 54% 38% 28% 22% 1% 5% 6% 24,2% 24,2% 31% 78%

Spain 34% 45% 56% 12% 15% 18% 1% 5% 6% 19,3% 19,3% 20% 96%

Sweden 52% 56% 63% 60% 51% 43% 1% 7% 8% 42,2% 42,2% 49% 86%

United Kingdom 10% 18% 24% 3% 4% 4% 1% 3% 5% 7,1% 7,1% 15% 47%

Cyprus 1% 2% 3% 17% 19% 23% 1% 2% 4% 6,1% 6,1% 13% 47%

Czech Republic 6% 12% 15% 10% 7% 5% 2% 8% 8% 8,6% 8,6% 13% 66%

Estonia 3% 4% 11% 38% 36% 39% 0% 1% 1% 17,5% 17,5% 25% 70%

Hungary 5% 7% 7% 8% 7% 9% 2% 7% 7% 7,0% 7,0% 13% 54%

Latvia 36% 38% 35% 51% 38% 28% 0% 1% 1% 26,7% 26,7% 42% 64%

Lithuania 4% 5% 11% 31% 30% 34% 0% 3% 11% 15,6% 15,6% 23% 68%

Malta 0% 1% 1% 5% 7% 9% 1% 3% 5% 2,6% 2,6% 10% 26%

Po land 6% 12% 15% 11% 11% 11% 4% 14% 13% 11,6% 11,6% 15% 77%

Slovakia 20% 23% 24% 7% 7% 7% 0% 0% 0% 9,2% 9,2% 14% 66%

Slovenia 27% 32% 30% 25% 28% 39% 0% 0% 1% 20,3% 20,3% 25% 81%

Bulgaria 10% 10% 13% 17% 19% 25% 1% 3% 6% 11,6% 11,6% 16% 72%

Romania 31% 30% 30% 21% 18% 18% 0% 1% 6% 16,9% 16,9% 24% 70%

EU 27 19,6% 24,0% 26,5% 12,1% 12,2% 13,8% 1,3% 5,9% 7,0% 13,2% 13,2% 20% 66%

% RES-E % RES-H % RES-T % RES-final

* considering an equal biofuel 2020-target in size of 10% for

all Member States ("biofuel equalisation")

Country

breakdown

Proposed RES

targets

European Union 272006 2010 2020 2030

Share of RES-E on electricity demand 16% 20% 24% 26%

Share of RES-H on heat demand 10% 12% 12% 14%Share of RES-T on transport fuel demand 1% 1% 6% 7%

Share of RES on final demand 9% 11% 13% 15%

Share of RES on primary demand 7% 8% 11% 14% (Eurostat convention)

10% 12% 16% 19% (Substitution principle)

% deployment

• No target achievement

• Hardly any contribution in the heat sector

• Low increase of RES share beyond 2020

Scenario results – Europe AloneEurope Alone

• Exact target achievement in 2020

• Well contribution in all three energy sector

• Ambitious increase of RES share beyond 2020

European Union 272006 2010 2020 2030






% deployment

2010 2020 2030 2010 2020 2030 2010 2020 2030 2020 2020*

Austria 69% 83% 88% 29% 37% 46% 1% 5% 7% 37,5% 38,2% 34% 112%

Belg ium 6% 13% 20% 4% 8% 13% 0% 9% 11% 9,2% 9,2% 13% 71%

Denmark 35% 43% 89% 31% 38% 52% 0% 11% 18% 30,1% 29,4% 30% 98%

Finland 29% 35% 45% 45% 55% 71% 0% 5% 8% 40,2% 40,6% 38% 107%

France 19% 31% 47% 16% 26% 37% 4% 10% 8% 22,7% 21,9% 23% 95%

Germany 14% 32% 39% 6% 15% 23% 4% 8% 10% 16,7% 16,7% 18% 93%

Greece 13% 26% 49% 16% 23% 31% 2% 8% 8% 18,9% 19,2% 18% 106%

Ireland 14% 40% 88% 5% 11% 19% 2% 9% 11% 15,7% 15,9% 16% 100%

Italy 21% 30% 34% 4% 11% 27% 2% 7% 9% 14,2% 14,6% 17% 86%

Luxembourg 4% 10% 16% 2% 6% 9% 1% 6% 7% 6,2% 7,4% 11% 67%

Netherlands 10% 23% 41% 2% 6% 13% 1% 6% 8% 10,1% 11,0% 14% 79%

Portugal 41% 59% 87% 38% 40% 54% 1% 1% 1% 31,4% 34,0% 31% 110%

Spain 34% 59% 86% 12% 20% 34% 2% 7% 4% 25,2% 26,0% 20% 130%

Sweden 55% 64% 80% 58% 53% 60% 3% 9% 11% 46,1% 45,5% 49% 93%

United Kingdom 11% 34% 53% 3% 8% 20% 1% 7% 10% 13,8% 14,5% 15% 97%

Cyprus 1% 17% 41% 15% 23% 32% 1% 4% 8% 11,9% 13,4% 13% 103%

Czech Republic 7% 19% 22% 10% 16% 22% 4% 9% 9% 14,9% 14,8% 13% 114%

Estonia 3% 14% 38% 37% 50% 79% 0% 4% 8% 28,1% 30,1% 25% 121%

Hungary 6% 21% 25% 8% 17% 28% 3% 12% 18% 16,4% 15,3% 13% 118%

Latvia 38% 60% 74% 52% 61% 78% 0% 7% 15% 44,7% 45,3% 42% 108%

Lithuania 5% 15% 44% 32% 48% 61% 3% 15% 42% 30,4% 27,5% 23% 119%

Malta 0% 16% 22% 4% 11% 22% 1% 5% 8% 9,3% 10,3% 10% 103%

Po land 6% 20% 33% 12% 20% 30% 6% 16% 23% 19,1% 17,2% 15% 115%

Slovakia 20% 32% 36% 8% 17% 27% 0% 7% 12% 18,4% 18,5% 14% 132%

Slovenia 29% 45% 41% 24% 41% 55% 0% 2% 5% 29,5% 31,9% 25% 128%

Bulgaria 10% 20% 33% 18% 32% 44% 2% 12% 14% 22,5% 21,5% 16% 134%

Romania 32% 48% 58% 21% 25% 35% 1% 20% 25% 28,8% 26,5% 24% 111%

EU 27 20,4% 35,3% 49,9% 12,1% 19,7% 30,6% 2,3% 8,3% 9,7% 20,1% 20,1% 20% 100%




Country

breakdown

Proposed RES

targets

49,9%

30,6%

9,7%

26,0%

34,7%

30,2%

0%

10%

20%

30%

40%

50%

60%

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

RE

S-d

eplo

ymen

t - in

rela

tive

term

s (i

.e. a

s sh

are

of c

orre

spon

ding

gr

oss

dem

and)

[%]

RES-electricity

RES-heat

RES-transport



RES-final

Scenario results – Global Regime / Full TradeGlobal Regime / Full Trade

• Exact target achievement in 2020

• Lower RES-E share due to higher demand

• Ambitious increase of RES share beyond 2020

European Union 272006 2010 2020 2030






% deployment

2010 2020 2030 2010 2020 2030 2010 2020 2030 2020 2020*

Austria 69% 81% 87% 29% 37% 45% 1% 6% 7% 37,4% 38,0% 34% 112%

Belgium 6% 12% 15% 4% 8% 14% 0% 9% 10% 8,9% 8,9% 13% 68%

Denmark 35% 51% 102% 31% 38% 49% 0% 11% 20% 32,0% 31,4% 30% 105%

Finland 29% 37% 43% 45% 54% 68% 0% 5% 8% 40,2% 40,7% 38% 107%

France 19% 28% 42% 16% 25% 37% 4% 11% 8% 21,8% 21,0% 23% 91%

Germany 14% 35% 37% 6% 14% 24% 4% 8% 12% 17,3% 17,2% 18% 96%

Greece 13% 25% 46% 16% 24% 29% 2% 8% 10% 18,5% 18,8% 18% 105%

Ireland 14% 40% 84% 5% 11% 19% 2% 9% 10% 15,2% 15,5% 16% 97%

Italy 21% 30% 31% 4% 11% 26% 2% 7% 9% 14,0% 14,4% 17% 85%

Luxembourg 4% 9% 15% 1% 5% 9% 1% 6% 7% 5,8% 7,1% 11% 65%

Netherlands 10% 31% 40% 2% 7% 14% 1% 6% 8% 12,1% 13,1% 14% 93%

Portugal 41% 56% 79% 38% 40% 51% 1% 5% 1% 31,9% 33,0% 31% 106%

Spain 34% 60% 90% 12% 20% 32% 2% 7% 6% 25,3% 26,1% 20% 130%

Sweden 55% 63% 77% 58% 52% 58% 3% 9% 13% 45,6% 45,2% 49% 92%

United Kingdom 11% 32% 51% 3% 9% 18% 1% 7% 10% 13,5% 14,3% 15% 96%

Cyprus 1% 16% 35% 15% 25% 29% 1% 4% 7% 12,2% 13,7% 13% 106%

Czech Republic 7% 18% 21% 10% 16% 22% 4% 8% 10% 14,8% 14,8% 13% 114%

Estonia 3% 22% 42% 37% 50% 75% 0% 4% 7% 30,0% 32,1% 25% 129%

Hungary 6% 20% 23% 8% 17% 26% 3% 12% 18% 16,2% 15,2% 13% 117%

Latvia 37% 55% 72% 51% 60% 76% 0% 8% 13% 43,5% 44,0% 42% 105%

Lithuania 4% 16% 43% 32% 47% 59% 3% 15% 41% 30,2% 27,4% 23% 119%

Malta 0% 16% 22% 4% 11% 18% 1% 5% 8% 9,0% 10,1% 10% 101%

Po land 6% 19% 32% 12% 20% 28% 6% 15% 21% 18,8% 17,1% 15% 114%

Slovakia 20% 33% 36% 8% 18% 27% 0% 7% 11% 19,0% 19,3% 14% 138%

Slovenia 29% 44% 41% 24% 39% 53% 0% 2% 5% 28,8% 31,3% 25% 125%

Bulgaria 10% 20% 30% 18% 31% 43% 2% 12% 13% 22,1% 21,1% 16% 132%

Romania 32% 46% 57% 21% 24% 32% 1% 20% 25% 27,7% 25,5% 24% 106%

EU 27 20,3% 35,6% 47,9% 12,1% 19,5% 29,6% 2,3% 8,5% 10,3% 20,0% 20,0% 20% 100%




Country

breakdown

Proposed RES

targets

47,9%

29,6%

10,3%

25,1%

33,2%

29,2%

0%

10%

20%

30%

40%

50%

60%

2006

2008

2010

2012

2014

2016

2018

2020

2022

2024

2026

2028

2030

RE

S-d

eplo

ymen

t - in

rel

ativ

e te

rms

(i.e

. as

shar

e of

cor

resp

ondi

ng

gros

s de

man

d) [%

]

RES-electricity

RES-heat

RES-transport



RES-final

Comparison – Development of different policy storyli nes

0 100 200 300 400 500 600 700 800 900

Biogas

Solid biomass

Biowaste


Hydro large-scale

Hydro small-scale

Photovoltaics


Tide & wave

Wind onshore

Wind offshore

Biogas (grid)

Solid biomass (grid)

Biowaste (grid)

Geothermal heat (grid)

Solid biomass (non-grid)

Solar thermal heat. & water

Heat pumps

1st generation biofuels

2nd generation biofuels

Biofuel import

Energy generation (electricity, heat, transport fue l) from NEW RES plant (installed 2006 to 2030) [TWh/yr ]

GR - Optimised na tional polic ies

EA - Optimised national policies

MT - BAU

Ele

ctric

ityH

eat

Tran

spo

rt

Due to higher CO2 constraints for Europe, electricity wholesale prices in the Europe Alone scenario are higher and hence a stronger RES-E contribution is expected than at global common

CO2 constraints

Policy sensitivity – Different policy support measur es

Less RES generation in the electricity sector at technology neutral support measures , leading to fail the 20% RES by 2020 target, regardless the maximum certificate price. Strong deviations in

2020 and especially strong beyond 2020

0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

2010 2020 2030cum

ula

tive

ener

gy

gen

erat

ion

by

sect

or

(200

6-20

30)

in

[TW

h]

RES-Biofuel (TOTAL)

RES-Heat (TOTAL)

RES-Electricity (TOTAL)

0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

2010 2020 20300

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

2010 2020 20300

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

2010 2020 2030

Global Regime - Full TradeStrengthened national

Global Regime - Full TradeHarmonized Feed-In premium

Global Regime - Full TradeQuota system on TGC (pen75)

Global Regime - Full T radeQuota system on TGC (pen150)

• Strengthened national policy: National policy implementation in order to meet the 20% RES target

• Harmonized premium feed-in tariff: Common premium on top of the electricity wholesale price in order to meet the 20% RES target

• Quota system based on technology neutral, tradable green certificates:Quantity driven with a maximum price on top of the electricity wholesale price

Policy sensitivity – Different policy support measur es

Strong deviations of RES generation for currently novel, more expensive technologies which are needed for challenging future RES targets (wind offshore, PV, solar thermal electricity)

0 100 200 300 400 500 600 700 800 900

Biogas

Solid biomass

Biowaste


Hydro large-scale

Hydro small-scale

Photovoltaics


Tide & wave

Wind onshore

Wind offshore

Biogas (grid)

Solid biomass (grid)

Biowaste (grid)

Geothermal heat (grid)

Solid biomass (non-grid)

Solar thermal heat. & water

Heat pumps

1st generation biofuels

2nd generation biofuels

Biofuel import

Energy generation (electricity, heat, transport fue l) from NEW RES plant (installed 2006 to 2030) [TWh/yr ]

GR - Feed-in premium

GR - Optimised nationa l polic ies

GR - Quota tech neutral penalty 75

GR - Quota tech neutral penalty 150

Ele

ctric

ityH

eat

Tran

spo

rt

Costs of enhanced RES deployment

Only moderate increases are expected in the Business as Usual case

A tripling of investments is expected within the next 10 years in order to meet the target ->Need for efficient and effective policy measures to limit consumer expenditures

Less investments have to be taken beyond 2020 due to learning effects and decreased costs

0

20.000

40.000

60.000

80.000

100.000

120.000

2006 2010 2020 2030

Ann

ual i

nve

stm

ent n

eeds

[M€]

RES-T totalRES-H totalRES-E total

0

20.000

40.000

60.000

80.000

100.000

120.000

2006 2010 2020 20300

20.000

40.000

60.000

80.000

100.000

120.000

2006 2010 2020 2030

Muddling Through - Business as Usual

Europe Alone -Stregthened national policy

Global Regime - Full Trade -Stregthened national po licy

Required investment in order to meet the enhanced RES deployment in 2010, 2020 and 2030

Higher policy costs in the Global Regime than in the Europe Alone scenario, due to less CO2 constraints in the EU and consequently lower energy wholesale prices

0

30.000

60.000

90.000

120.000

150.000

180.000

2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030

Ann

ual

tra

nsf

er c

ost

s fo

r so

cie

ty

due

to R

ES

po

licy

[M€]

RES-E total RES-H to tal RES-T total

Costs of enhanced RES deployment

Corresponding consumer expenditures = policy costs

0

30.000

60.000

90.000

120.000

150.000

180.000

2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030

Ann

ual

tra

nsf

er c

ost

s fo

r so

cie

ty

due

to R

ES

po

licy

[M€]

RES-E total RES-H total RES-T total

0

30.000

60.000

90.000

120.000

150.000

180.000

2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030

Ann

ual

tra

nsf

er c

ost

s fo

r so

cie

ty

due

to R

ES

po

licy

[M€]

RES-E tota l RES-H total RES-T to tal

Tripling the investments only leads to less than a doubling of policy costs

Sensitivity cases :Costs of enhanced RES deployment according to the different policy options

Only technology specific support options meet the 20% RES in 2020 target (left figures)

Nevertheless, technology specific options result in lower consumer expenditures due to enhanced RES support

Increasing the limit of certificate prices hardly increases the RES generation but tremendously increase the policy costs, hence the consumer expenditures

0

40.000

80.000

120.000

160.000

200.000

2010 2020 2030

Ann

ual

so

ciet

y co

sts

due

to

RE

S p

olic

y in

[M€]

RES-T totalRES-H total

RES-E total

0

40.000

80.000

120.000

160.000

200.000

2010 2020 20300

40.000

80.000

120.000

160.000

200.000

2010 2020 20300

40.000

80.000

120.000

160.000

200.000

2010 2020 2030

Global Regime - Full TradeStrengthened national

Global Regime - Full TradeHarmonized Feed-In premium



Sensitivity cases :Costs of enhanced RES deployment according to the different policy options

0

5

10

15

20

25

30

35

40

12% 13% 14% 15% 16% 17% 18% 19% 20% 21%

RES share on (gross) final energy demand [%]

Ave

rage

(2

006

to 2

020)

yea

rly a

dditi

ona

l co

st -

refe

rrin

g to

NE

W R

ES

pla

nts

(200

6 to

20

20) [

Bill

ion

€]

Average transfer costdue to RES support

Average additiona lgeneration cost

GR - Optimised national RES support

EA - Optimised national RES support

MT -BAU (continuation of current RES support)

0

5

10

15

20

25

30

35

40

45

50

17% 18% 19% 20% 21%

RES share on (gross) f inal energy demand [%]

Ave

rag

e (2

006

to 2

020

) ye

arly

add

ition

al

cost

- r

efe

rrin

g to

NE

W R

ES

pla

nts

(20

06

to

2020

) [B

illio

n €]

Average transfer cost dueto RES support

Average additionalgeneration cost

GR - Optimised national RES support

GR - Harmonised technology-specific RES support (Premium feed-in tariff system)

GR - Harmonised technology-neutral RES support (Quota system/penalty 75€/MWh)

GR - Harmonised technology-neutral RES support (Quota system/penalty 150€/MWh)

Business as Usual fails to meet the target at high consumer costs

Strengthened national policy options meet the target at only moderately higher consumer costs

Technology specific support is deeply recommended in order to increase ambitious shares of RES and avoid big producer surpluses causing higher consumer expenditures and less social acceptance of RES

Contribution of RES to decreasing import dependency

Muddling Through:267 Mtoe avoided fossil fuel consumption in 2030 due to domestic RES

generation, meaning 78 billion Euro

Europe Alone:540 Mtoe avoided fossil fuel consumption in 2030 due to domestic RES

generation, meaning 146 billion Euro

Global Regime – Full Trade:539 Mtoe avoided fossil fuel consumption in 2030 due to domestic RES

generation, meaning 145 billion EuroOil imports can be reduced by 18%, gas imports by 51% and coal imports even by 68%.

Conclusions – General implications for security of ene rgy supply

• An increased use of RES in the electricity, transport and the heating sector may contribute considerably to decreasing import dependency

• Additional benefits of RES with regard to the achievement of climate change targets

• But: Decrease in import dependency involves certain transfer costs for society

• Economic risk: competitiveness of RES is expected to improve in the future

• Other threads resulting from the specific character of RES (variable power output) seem to be still manageable � May require certain changes in system operation and infrastructure

Contact

Anne Held

e-mail: [email protected]

Fraunhofer Institute for Systems and Innovation Research (ISI) Breslauer Straße 48 76139 Karlsruhe, Germany www.isi.fraunhofer.de

Christian Panzer

e-mail: [email protected]

Energy Economics Group (EEG)Vienna University of TechnologyGusshausstraße 25-29/E373-21040 Vienna, Austriahttp://eeg.tuwien.ac.at

Thank you for your attention!

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