EURELECTRIC: Renewables Must Enter The Market

The European Commission's strategy on renewables (RES) should spell out immediate next actions and clearly distinguish between the pre- and post-2020 periods, EURELECTRIC says in a paper published today in response to the Commission's Renewable Energy Communication.
In EURELECTRIC's view, the EU's post-2020 RES strategy must build on the EU Emissions Trading Scheme as the key driver for investment in low-carbon generation, while its pre-2020 RES strategy should focus on 'bringing RES to the markets.'
The growth of renewables in Europe is a positive development, which adds additional technologies to the European generation mix. ButEuropean customers deserve cost-efficient solutions, in particular in these times of economic crisis and consecutive budgetary constraints. EURELECTRIC has therefore long supported the progressive integration of renewable energy into electricity markets. We agree with the Commission's general stance, throughout its Communication, that RES support should not exist forever. Instead, RES support mechanisms should evolve over time and be compatible with market dynamics. In our view, bringing RES to the market can be narrowed down to two elements:

• Like any other generation technology, RES technologies should be responsible for scheduling and operation, participate in the wholesale markets and be subject to equivalent obligations regarding grid connection, balancing and grid charges. We would like to see the Commission take prompt and decisive action on this, so that progress can be made well before 2020.
• In the interest of cost-efficiency, subsidies for RES technologies must be progressively phased out as technologies reach market competitiveness and broad deployment. The phase-out should make sure not to harm investor confidence (i.e. clearly signalling regulatory changes, no retroactive changes).

The EURELECTRIC paper also underlines that renewable energies should not be developed in isolation from the broader energy system of which they are a part. EU renewables policy must therefore look beyond increasing RES capacity, towards implementing measures that support a sustainable and secure growth of RES. This includes achieving a fully integrated electricity market in Europe by 2014, developing the necessary transmission and distribution infrastructure, providing flexible back-up capacity and promoting smart grids and demand-side participation.
More information:
EURELECTRIC's first reaction to the Commission RES Strategy (05/06/12)
EURELECTRIC Renewables Action Plan