European Commission To Member States: Follow Our Lead for Renewable Energy Policy

New Hampshire, USA -- The European Commission has offered up some new guidelines about managing electricity markets among its Member States, offering direction for design and support schemes for renewable energy, managing capacity, and addressing demand at the consumer level to mitigate new generation investments -- which, while technically not binding, likely will inform future regional environmental and aid policies.

Renewable power generation is fast approaching parity with non-renewables, though in general any new generation type is more costly than market prices for electricity, according to recent analysis from the International Energy Agency. But those IEA studies are "not comparable [nor] fully applicable" to future energy policy directions, says the EC, so it is undertaking its own analysis of cost comparisons and subsidies of various technologies, pledging to issue its report next June.

While supportive of Member States' efforts to establish an internal electricity market for Europe by 2014, the EC underscores the needs to adhere to European Union policies about secure and competitively priced supplies, renewable energy and climate change objectives, and energy efficiency improvements. Thus, it is stepping forward to "define the role, level and nature of public intervention, in line with the principle of subsidiarity, at Union, regional, national or local level." (Here's the PDF of the EC's proposals and explanations.)

Specifically for renewable energy (admittedly focused on solar and wind), the EC suggests adapting policies and rules for state intervention to recognize future market needs. That means letting the market dictate investment and production decisions, and thus gradually phasing out feed-in tariffs (FIT) and moving towards other "supportive instruments" more tied to market pricing, such as auctions and tenders, feed-in premiums, and quota obligations. (Other types of support such as domestic content requirements, the EC advises, "might not be in line with the EU acquis.") Cooperation mechanisms also should be pursued, seeking to leverage renewable energy opportunities across Member State borders, including joint projects and support schemes. Unannounced or retroactive scheme changes should be avoided to preserve investor confidence, says the EC -- quite likely a memo to Spain about its recent legislative about-face. Renewable energy support and goals ought to align more closely with Europe's carbon emissions trading schemes, says the EC, and these principles and directions it is laying out for public intervention in electricity markets could also be applied in other sectors, such as heating and transportation. All the EC's recommendations and discussions, including examples of standardized forms, are listed here within individual working documents.

While the EC acknowledges all these guidelines and recommendations are not legally binding to Member States, it urges that they will be applied when the EC assesses state interventions into renewable energy support schemes or capacity mechanisms, and will "guide the future enforcement of EU state aid rules and future proposals for EU energy legislation." The EC is currently prepping a draft for guidelines due next year on environmental and energy aid for 2014-2020.

Broadly speaking the EC's proposals are well-timed, encouraging Member States to take the lead on deployment of renewable energy while raising broader issues of generation, availability to the EC's level, notes the European Photovoltaic Industry Association (EPIA). However, many of the EC's recommendations such as "competitive allocation mechanisms" and auction processes emphasize factors relevant to large-scale renewable energy efforts, and would tend to ignore or lock out smaller distributed-generation efforts and self-consumption, the EPIA notes. And adjusting renewable energy support schemes to be more market-based wrongly assumes that there's a level playing field in the market to begin with; "requesting market responsiveness from renewables would be putting the cart before the horse," says EPIA policy director Frauke Thies.

The EC also calls for Member States to assess and address "generation inadequacy" and whether and how to incorporate ancillary services into the equation particularly to balance renewable energy. This is especially important and needs to be "harmonized" across Europe as a whole, notes the EPIA, adding that the EC should emphasize it even more, particularly development of aggregation strategies. The group also thinks the EC must offer more direction in flexibility requirements such as demand response and energy storage, and rewarding more flexible generation assets.

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EU Debate Over Climate Change Policy Could Dampen Renewable Energy Growth

Members of the European Parliament’s environment committee meet today for a second time to revive a plan the full assembly rejected that would have boosted the cost of greenhouse-gas emissions. The rebuff left the cost of pollution near a record low, leaving companies with less incentive to reduce emissions.

The situation “reflects a sea-change against climate policy,” said European Green Party Co-Chair Reinhard Buetikofer, who supported the plan. The effort to limit carbon gases “is not being perceived as an opportunity by industry but rather a burden,” he said, adding that the decision “destroyed the foundation of common European climate policy.”

With a recession in the countries sharing the euro in its second year, efforts to clean up the environment and spur renewables are taking a back seat to programs that bail out the most indebted countries and put people back to work. They herald a wider struggle to set new climate protection and renewable energy policies, and threaten to keep prices near historic lows in the Emissions Trading System, or ETS.

The region’s recession crimped manufacturing output, reducing pollution in the process. The EU’s failure to mop up surplus permits sent prices lower.

Company Impact

Lower carbon prices help power generators that use a greater share of coal, since burning coal emits about twice as much carbon dioxide as natural gas. Utilities such as RWE AG in Essen, Germany, and Warsaw-based PGE SA benefit over those that derive energy mostly from wind, natural gas and uranium, including Germany’s EON SE, France’s GDF Suez SA and CEZ AS in Prague. All have been hurt by a drop in power prices stemming from the economic slump.

“With a carbon price of nil, coal is by far the most attractive option,” said Chris Davies, a U.K. member of the assembly’s environment committee. “One of the purposes of the ETS was to give long-term direction to investors. With climate policy seen to be in disarray, there is no such direction.”

Companies need a stable carbon price on which to base investment decisions, said GDF Suez Chief Executive Officer Gerard Mestrallet. “We have to re-establish a carbon signal,” he told reporters on May 2. “Coal is being chosen ahead of gas, so gas plants are being stopped. It’s an enormous problem.”

EON CEO Johannes Teyssen said at the company’s annual meeting in Essen on May 3 that lawmakers have made the emissions system “shrivel” and that the vote was “a black day for efficient climate protection.” A company spokesman said it would hurt margins for generating power from gas.

Price Slump

The cost of carbon dioxide credits on the European Union emissions trading system fell from an all-time high of 31 euros a metric ton in April 2006 to 3.81 euros on the ICE Future Europe exchange as of 12:05 p.m. in London today. Utilities that have a stock of carbon credits, such as Spain’s Endesa SA, may have to write down their value, said Jose Martin-Vivas, a utilities analyst for Mirabaud Securities in Madrid.

The proposal to temporarily cut the oversupply of allowances divided EU governments, Parliament and industry. While nations led by France, Denmark and the U.K. backed the fix, Poland, Greece and Cyprus were among those opposing it, saying it would raise energy prices and might amount to market manipulation.

Lawmakers sent the plan, known as backloading because it delays auctions for new credits, back to the committee for more talks. Legislators on the panel are scheduled to meet today and tomorrow. They have until mid-June to recommend a solution on the market fix to the full assembly. Climate experts from the EU’s 27 governments convene on May 27 to discuss a solution.

German Position

Buetikofer said the measure was weighed down by German Chancellor Angela Merkel’s failure to speak in favor of it. On May 3, the chancellor said she supported backloading while indicating the coalition government doesn’t have a unified position on the matter yet. They were her first comments on the subject. Speaking at a climate conference in Berlin today, Merkel said carbon permits prices are lower than assumed because of the economic slump.

“I personally say that if you develop a system for which projected growth rates are a key element, and the growth rates are totally different from what you projected, then the question whether one has to revise that can’t be a taboo,” she said.

Mired in sovereign-debt crises that’s forced five nations to take bailouts, the EU is trying to balance climate policies that raise electricity costs high enough to encourage renewables against the need to keep manufacturers competitive.

The bloc’s regulatory arm, the commission, says Europe needs new targets to cut greenhouse gases after current ones expire in 2020, and a renewable energy framework through 2030 to give investors clarity and prepare for a global climate deal.

‘Reality’

“Backloading shows how difficult the reality is,” said Matthias Groote, chairman of the environment committee, who oversees the proposal in the assembly. “It’s 100 percent certain that it all makes the debate on 2030 targets more difficult.”

Parliamentarians on April 16 voted 334 to 315 for blocking the carbon market rescue.

“This is the first time I can remember when parliament has put economic survival and jobs ahead of green orthodoxy,” said Roger Helmer, a member of the U.K. Independence Party who has been in the parliament for 14 years and opposes emissions trading. “It marks an absolute watershed.”

Lobbyists including the BusinessEurope alliance of 41 industrial groups and Eurofer, which represents steelmakers, welcomed the vote, with Eurofer Director General Gordon Moffat saying “high carbon prices result in the deindustrialization of Europe.”

System’s Roots

The ETS was founded in 2005 and is the cornerstone of EU climate policy, capping emissions from more than 11,000 power plants and factories owned by companies from RWE, the bloc’s biggest emitter, to brewer Carlsberg A/S and steelmaker ArcelorMittal. Polluters are issued permits representing a ton of carbon. If their pollution exceeds their cap, they must buy permits from companies which undershoot.

With the EU system accounting for 89 percent of the $61 billion market worldwide, Australia, China, South Korea and California are among countries and regions planning or starting up their own emissions trading programs.

“At the very time that we’re failing to make our emissions trading policy work, other countries are going in that direction,” said Caroline Lucas, a U.K. lawmaker and former member of the European assembly who said while she’s “not a fan” of carbon markets, “it’s the only game in town.”

“They’ve scuppered a chance of making the emissions trading system an effective tool in the battle to reduce climate emissions,” she said.

Market Glut

Following the vote carbon permits for December plummeted as much as 45 percent, a record, and extended losses the next day to an all-time low of 2.46 euros a metric ton. They have lost as much 85 percent in the past four years as the economic slump cut demand for pollution rights and aggravated a glut of allowances.

The limits on greenhouse gas discharges were set before the euro area entered two recessions in four years which lowered industrial production and emissions, cutting demand for the allowances in the system, which has no price floor.

“This makes the ETS irrelevant in Europe’s bid to reduce the use of fossil fuels,” Remi Gruet, senior climate adviser at the European Wind Energy Association said in a statement after the vote. “The carbon price will continue having no impact on investment decisions in the power sector.”

Without shoring up the carbon market, member states are instead likely to pursue their own policies, according to Buetikofer. “What industry will get will be a very scattered patchwork kind of regulatory framework which will make their life much more miserable and bureaucratic impediments will be much more burdensome,” he said.

EU’s Ambition

The commission aims to propose by the end of this year a new set of goals to reduce greenhouse gases and boost the share of clean technologies in its energy consumption by 2030.

“It’s clear that now the 2030 discussion is more acute,” Finnish Environment Minister Ville Niinistoe said in an interview. Next year is going to be crucial for Europe as it needs to have a clear position to ensure predictability for investors and to lead international climate talks ahead of a planned 2015 global deal to cut greenhouse gases, he said.

A failure to tackle the glut of carbon permits may discourage utilities from switching to natural gas and other less-polluting energy sources from coal, the commission said in November. That may curb the spending needed in non-fossil fuel generation, estimated by Bloomberg New Energy Finance at about 400 billion euros, to meet the EU’s 2020 goals. The bloc aims to cut greenhouse gases by 20 percent from 1990 levels and derive a fifth of all energy from renewables by then.

“Green policies, if well designed, do not mean loss of competitiveness,” said Jos Delbeke, the commissions’ director general for climate. “The future of the EU lies in green growth, high-tech and innovation.”

The failed proposal raises a question of whether the EU can “ever be significantly improved,” said Chris Rogers, an analyst at Bloomberg Industries in London. “If something as minor as backloading can’t be agreed, then what hope is there for more ambitious carbon reduction targets for 2030, which are vital for both power and carbon prices?”

Copyright 2013 Bloomberg

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The Solyndra standard: on loan guarantees, military spending, and clean energy policy

This is the second test failed in a row for the WaveRider - an aircraft technology, which the military close to $300 million on the development between spent already has. And this is only on a program. We have worked on Hypersonic Flight programs since the 1960?s.

But even with more than a quarter billion dollars in hardware now sits in the Pacific Ocean (small change for the Pentagon) not we have heard a view from anyone in Washington on the crash. No calls for an investigation of the Congress, no outrage over hundreds of millions of dollars fall in 15 seconds, no public floggings mod Guide.

But hell, if a few innovative clean energy companies receive crash after support from the Federal Government, they are used as a tool by the national Republican party, to make the idea of strategic investments in Cleantech in question.

It is almost a year since Solyndra, the solar producers who receive a loan guarantee for $527 million in bankruptcy. Since then, House lawmakers have held 12 hearings and meet official, bought more than 300,000 documents, two Subpenas, and probably more than $1 million for the investigation issued.

What did they find?

"No evidence of wrong-doing," reported Bloomberg BusinessWeek.

The Washington Post went further in a recent study: "the records are not produced, that someone under pressure the Department of energy the Solyndra loan used to approve participants in favour of political."

This is not to say that we from the bankruptcy of Solyndra and other clean energy companies should shrug. Congress is mission to determine whether the tax makes sense - issued and throws you a view of the causes and consequences of such incidents is important for transparency.

But as we predicted when the Solyndra story first broke out, these studies have turned into a political SideShow. A year later, based on political Insider offers GOP legislators demonstrated, not their theory that decisions to offer that to clean energy loan guarantees. Still Theycontinue call to extend more documents and may have additional hearings, in the hope, the meme of "Nepotism" Solyndra until after the election.

Representative Jim Jordan (R - OH) which was most stump about the GOP's plan for Solyndra: press the manufactured scandal until November and then put it after the election.

E & E News reported Jordan's comments in March:

For all the talk about possible "Smoking Guns" may some wrongdoing on the part of the Obama management on Solyndra or other Department of energy loans, show that the House Republican confirmed yesterday that several GOP on the subject of probes are in some ways a game for votes on election day.

"Ultimately we it stop on election day, hopefully. " "And attention to these things will help the voters and the nature of the decision which I hope will make the country, which helps them as they assess who they are for in November votes."

That's exactly how it is to play. The politically manufactured outrage about Solyndra to an all-out campaign made - with tens of millions of dollars, issued season this election specifically for targeting Federal renewable energy investment. Mitt Romney has jumped on the bandwagon, with Solyndra as a key part of his campaign.

And here is the really amazing separate: while supporting tens of thousands of jobs, the credit guarantee program is expected that $2 billion less cost than Congress, according to an analysis by Herb Allison, John McCain's former National Chairman finance scheduled.

Meanwhile in the midst of the Solyndra saga we accept passing a $300 million aircraft errors, without batting an eye. No outrage. No sustained political campaign. It's just another day test our military toys.

Why? Because we often do not see programs such as "Failure" in the political arena. We would never use a failure as an excuse to leave investment in new technologies. Most politicians accept losses in the R & D of military spending, because after all, the long-term benefits are potentially so important for national defense and for the development of technologies for civilian use.

We should always aim to make programs as efficient and cost-effective as possible. But a few bankruptcy clean energy companies, representing a fraction of the cost of the programme is no excuse for the task of the Federal investment in clean energy - a strategically important sector which is one of the greatest drivers of the business in this century.

Expect Oh, not anyone publicly this admit. As the campaign unfolds season, political leaders are all too willing to practice the Solyndra standard.

This article appeared originally on the climate progress and was republished with permission.

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Leaning gas production policy call

31 July 2011 last Rigby BBC News updated at 07: 44 GMT by Caroline up to ? 70bn in the value of reserves in the rocks below South Wales can be of shale gas, research suggests shadow UK energy Minister Huw Irranca-Davies has the British Government develop a policy on shale gas required.

Potential multi-million pound reserves lie under in South Wales but his claimed Fracking called an extraction method causes pollution and could lead to earthquakes.

Ogmore MP says the gas can help deliver energy requirements but must be handled securely.

The Government says that attempts, for it must be drilling ecologically viable.

Mr Irranca-Davies Davies told BBC Wales country focus program, which he continues to pressure on the UK energy Minister, Charles Hendry on the subject.

It comes after research by exploration companies, which a possible ? 70bn of reserves in rocks found deep in South Wales and numerous planning applications submitted for test borings are carried out.

Wind and renewable energy

Continue reading the most important story

If shale gas, such as our accompanying transition to a low carbon future can and offer cheap affordable gas, as it has done in the United States, then large "

end quote Huw Irranca-Davies Ogmore MP started Fracking in Blackpool this year but was suspended while it looks in any link with two recorded earthquake."

Mr Irranca-Davies said that the British Government must embed shale gas in its larger energy policy.

"The reason is that if you look at something else if it nuclear, is, whether it's oil industry if they wind and renewable energy or even tide fit them all within a proper coherent policy structure."

"With shale gas, we have the risk is it then bring captured us."

However, it is not against the exploitation of slate gas as a whole.

Health and safety

"Many people recognize that there may be potential for shale gas." "In particular, if on the decline in the North Sea gas and our increasing dependence on imports of gas-LNG look and elsewhere, from Russia, pipes made of Norway Rohrleitungen--could have the potential."

He added: "If shale gas, such as our accompanying transition to a low carbon future can and offer affordable gas cheap, as it has done in the United States, then great."

"But only if it is done safely when it serves no impact on the environment and the health and safety of persons in the areas will be also." "Why not the Government you this and decide, as do security, if at all?"

"We will continue to keep pushing because I do not want vollig-- shale gas excluded, even though I know there are some people who would want to see it completely prohibited."

"But I do not agree with them because I think that we need to assess their potential and their risks adequately."

The Department of energy and climate change said that companies need to go to win before all Fracking takes place through a variety of reviews including planning permission.

Earlier this month national level guidelines to promote gas shale Vale of Glamorgan Council leader, Gordon Kemp, called for.

The Welsh Government has also said that it is working with UK Minister to set up it would welcome a political framework.

A spokesman said it "British Government work with decentralised administrations a introduce overall concept for shale gas would welcome." "But the case for a moratorium is Westminster."

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