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European Position Paper on Solar PV Support Schemes for Sustainable Growth

Explore best practices, conclusions, and proposals for feed-in tariffs, tax incentives, and other instruments to foster solar photovoltaic market development in Europe. Comprehensive report for policymakers.

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European Position Paper on Solar PV Support Schemes for Sustainable Growth

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  1. European Position Paper and Action Plan Support Schemes dedicated to Willem and Wim PV Policy Group - Thematic WG - 2nd meeting

  2. Content Position • Conclusions Best Practice Report • Conclusion 1ste Thematic WG meeting • Position Team Proposal Action plan • Conclusions Best Practice Report • Conclusion 1ste Thematic WG meeting • Position Team Proposal PV Policy Group - Thematic WG - 2nd meeting

  3. Position: Conclusions Best Practice Report: Feed in tariff – best practices: • Germany: high tariff, decreasing each year, plus long term security • Spain: high tariff, following electricity price developments, plus long term security PV Policy Group - Thematic WG - 2nd meeting

  4. Position: Conclusions Best Practice Report: Feed in tariff – requirements: • differentiation of the tariff: local irradiation, sort of installation • long term security of payment (return on investment) • annual decrease of the tariff, following/forcing reduction of costs PV Policy Group - Thematic WG - 2nd meeting

  5. Position: Conclusions Best Practice Report: Tax incentives – best practices: • France: 40 % tax credit plus 14,1% VAT reduction • Sweden: 70 tax credits (for PV on public buildings) PV Policy Group - Thematic WG - 2nd meeting

  6. Position: Conclusions Best Practice Report: Tax incentives requirements: • the total refunds should be worth the administrative effort • the incentive scheme should be easily accessible • the procedure should be simple and straight forward PV Policy Group - Thematic WG - 2nd meeting

  7. Position: Conclusions Best Practice Report: Tax incentive examples: • VAT reduction, • tax credits, independent of the taxes paid • tax deduction for part of the costs • possibility to move investment tax deduction for • or backward in time reduction of property taxes • no tax on investment profit PV Policy Group - Thematic WG - 2nd meeting

  8. Position: Conclusions Best Practice Report: Other instruments – requirements: • the total refunds should be worth the administrative effort • the incentive scheme should be easily accessible, and the procedure should be simple and straight forward. PV Policy Group - Thematic WG - 2nd meeting

  9. Position: Conclusions Best Practice Report: Other instruments – examples: • direct subsidies in % of project costs • direct subsidies in €/Wp • soft loans, well below the base-interest PV Policy Group - Thematic WG - 2nd meeting

  10. Position: Conclusions 1st Thematic WG Feed in tariff: • feed-in tariff and grid access code are crucial. • the consequences of feed-in tariff and subsidies for final consumers (cost agreement) need to be further elaborated in the rapporteurs' working groups. • feed-in tariff calculation is a complicated exercise. PV Policy Group - Thematic WG - 2nd meeting

  11. Position: Conclusions 1st Thematic WG Feed in tariff: • the reasons why feed-in tariff is the most efficient market mechanism should be explained • the objectives of the feed-in tariff scheme should be defined. • feed-in tariff values should be moderate. PV Policy Group - Thematic WG - 2nd meeting

  12. Position: Conclusions 1st Thematic WG Feed in tariff: • the principle of cost effectiveness has to be followed. • the feed-in tariff scheme should not be modified • the feed-in tariff cost should be passed to the consumers PV Policy Group - Thematic WG - 2nd meeting

  13. Position: Conclusions 1st Thematic WG Tax incentives: • not discussed Other instruments: • not discussed PV Policy Group - Thematic WG - 2nd meeting

  14. Position: Proposal Reasoning: • no contribution from PV in EU in near future: 0,5% by 2010 • large long term market: 20 – 40 % in 2050 PV Policy Group - Thematic WG - 2nd meeting

  15. Position: Proposal Reasoning: • need for preparation of desired long term market • no need for fast development of undesired niche markets PV Policy Group - Thematic WG - 2nd meeting

  16. Position: Proposal Statement: • long term PV market in Northern Europe is building integrated PV • long term markets for Southern Europe are (very) large scale power plants plus building integrated PV PV Policy Group - Thematic WG - 2nd meeting

  17. Position: Proposal Statement: • the support scheme should be independent from the government budget • the support scheme should be controlable (by the government PV Policy Group - Thematic WG - 2nd meeting

  18. Position: Proposal Set – up 1: • a limited feed in tariff for a small market • an additional investment support to attract early adopters and fine-tune market growth PV Policy Group - Thematic WG - 2nd meeting

  19. 1 2 Position: Proposal Set – up 1: combination of feed-in tariff (1) and investment support (2) PV Policy Group - Thematic WG - 2nd meeting

  20. Position: Proposal Set – up 2: • a feed in tariff with a ‘moving cap’:a) annual capb) quotum cap PV Policy Group - Thematic WG - 2nd meeting

  21. Position: Proposal Recommendations for feed-in tariffs: • avoid combinations of high tariffs and caps. • avoid tariffs, that cause unpredictable and uncontrollable market growth. • design a scheme with a differentiated tariff, PV Policy Group - Thematic WG - 2nd meeting

  22. Position: Proposal Recommendations for feed-in tariffs: • calculate tariffs, based on the best (=most cost effective) systems • design a scheme that stimulates or forces prise reductions. • consider net-metering PV Policy Group - Thematic WG - 2nd meeting

  23. Position: Proposal Examples of investment support instruments: • VAT reduction for PV systems • a generic subsidy in Euro/Wp • a tender subsidy for most cost efficient projects • tax deduction possibilities for investments in PV (or other sustainable solutions) PV Policy Group - Thematic WG - 2nd meeting

  24. Position: Proposal Examples of investment support instruments: • tax credits, refunded to the applicant independent of the tax bill • reduction community or real estate tax • refund of real estate costs, when acquired from the community PV Policy Group - Thematic WG - 2nd meeting

  25. Position: Proposal Aspects of investment support instruments: • VAT reduction:- easy to implement- little to no administration- loss of state income (DE 2005: 500 MEuro) PV Policy Group - Thematic WG - 2nd meeting

  26. Position: Proposal Aspects of investment support instruments: • Euro / Wp subsidy:- requires government budget- requires separate administration PV Policy Group - Thematic WG - 2nd meeting

  27. Position: Proposal Aspects of investment support instruments: • Tender:- requires government budget- requires separate administration- more appropriate for demo - phase PV Policy Group - Thematic WG - 2nd meeting

  28. Position: Proposal Aspects of investment support instruments: • Tax deduction:- easy to implement- little to no administration- loss of state income- income dependent PV Policy Group - Thematic WG - 2nd meeting

  29. Position: Proposal Aspects of investment support instruments: • Tax credits:- easy to implement- little to no administration- loss of state income PV Policy Group - Thematic WG - 2nd meeting

  30. Position: Proposal Aspects of investment support instruments: • Real estate tax or cost reduction:- difficult to implement- often under local government - large differences throughout the country PV Policy Group - Thematic WG - 2nd meeting

  31. Action Plan: Objectives 2007: A broad support for a standard method to set up national support schemes for the acceleration of PV deployment 2008: Increased harmonisation of national support schemes for the acceleration of PV deployment PV Policy Group - Thematic WG - 2nd meeting

  32. Action Plan: Targets 2007: • A support scheme recommended by the European Commission and supported by the PV Policy Group, EPIA and the PV Technology Platform; • A guideline describing how to set up an effective and controllable support scheme. • A common and generally accepted calculation method for the determination of a feed-in tariff • National position papers and action plans for setting up national support schemes for the acceleration of PV deployment PV Policy Group - Thematic WG - 2nd meeting

  33. Action Plan: Targets 2008: • National support schemes based on the national position papers and national action plans in the countries participating in the PV Policy Group 2010: • National support schemes based on the European position paper and the European action plan in all EU member states PV Policy Group - Thematic WG - 2nd meeting

  34. Action Plan: Steps • Tuning with WG1 (Policy and Instruments) and WG2 (Market) of the PV Technology Platform; • Tuning with the PV Technology Platform – Mirror Group; • Presentation for the PV Technology Platform; • Discussion wit the EC – TREN on the publication of a Recommended approach for the support of market implementation of PV energy systems; PV Policy Group - Thematic WG - 2nd meeting

  35. Action Plan: Steps • Formulation of a recommended support scheme; • Organisation of a conference for high level government officials, presenting and elucidating the recommended approach for the support of market implementation of PV energy systems; • formulation of national position papers and national action plans. PV Policy Group - Thematic WG - 2nd meeting

  36. Action Plan: Budget PV Policy Group - Thematic WG - 2nd meeting

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