Energy Policy for Europe

1. Neue Energiepolitikfür EuropaAn EU Energy Security and Solidarity Action Plan- Energy Package DIng.Dr. Karl Kellner , Advisor TREN -Dir. DNew and Renewable Energies,En.Efficiency and Innovation , Europ.Commission 24 April 2009 , Energie - Enquete Vorarlberger Landtag ,Bregenz

2. Energy Policy for Europe

3. R&D 7TH FRAMEWORK PROGRAMMESTRATEGIC ENERGY TECHNOLOGY PLAN (Nov 07) ENERGY FOR A CHANGING WORLD LIMITING CLIMATE CHANGE TO 2 °C GREEN PAPER ENERGY ACTION PLAN 2007-2009 ENERGY POLICY FOR EUROPE ENERGY PACKAGE 2007 SPRING EUROPEAN COUNCIL 2006 SPRING EUROPEAN COUNCIL 2007 SUSTAINABILITY AND LOW-CARBON ECONOMY INTERNAL MARKET EXTERNAL RELATIONS JOINT COMMISSION/HR/ COUNCIL JUNE 2006 PAPER AND COM PAPER OCT 2006 RENEWABLES RD MAP PROPOSAL FOR DIRECTIVE JAN SUSTAINABLE FOSSIL FUEL TECHNOLOGIES DG COMP SECTOR INQUIRY PROGRESS REPORT BIOFUELS ILLUSTRATIVE NUCLEAR PROGRAMME (PINC) REPORT ON FUNCTIONING OF INTERNAL MARKET NEGOTIATIONMANDATE FOR NEW AGREEMENT WITH RUSSIA PROGRESS REPORT RES ELECTRICITY PRIORITY INTERCONNECTION PLAN DIALOGUE WITHPRODUCERS: OPEC-NORWAY-GCC- ALGERIA-CASPIAN BASIN (BAKU PROCESS) ENERGY EFFICIENCY ACTION PLAN (19 OCT 2006) DIALOGUEWITHCONSUMERS: CHINA, US, INDIA, JAPAN

4. 2nd SER – focus on energy security - new political momentum to develop a European approach – completes 1st SER Integrated approach Mutually reinforcing Competitiveness Sustainable Development Security of supply

5. Moderate prices Baseline High prices Moderate prices New Energy Policy High prices Primary energy consumption (Mtoe)

6. Moderate prices Baseline High prices Moderate prices New Energy Policy High prices Net imports of gas (Mtoe)

7. The targets -20% GHG emissions(from 1990) -21% in ETS (base year 2005) -10% in non ETS (base year 2005) +20% Renewables +20% Renewables Electricity, biofuels heating Electricity and heating (>10 000 tCO2/yr) +10% Biofuels and heating

8. The targets -20% GHG emissions(from 1990) -21% in ETS (base year 2005) -10% in non ETS (base year 2005) 20% energy efficiency makes all targets easier to reach +20% Renewables Electricity, biofuels heating Electricity and heating (>10 000 tCO2/yr) +10% Biofuels and heating

9. 2nd SER – main messages • From a long term energy security viewpoint, the 20-20-20 strategy is the right direction to go in • In the short to medium term, to prevent and manage supply crises - Europe’s market and solidarity can diminish vulnerability - internationally, combined forces can be better than dispersed national actions EU Energy Security and Solidarity Action Plan • Need to start looking beyond 2020 to 2050

10. EU ENERGY SECURITY AND SOLIDARITY ACTION PLAN Indigenous energy resources Infrastructures, diversification External relations Energy efficiency Emergency oil stocks, Gas crisis response mechanisms Supporting analyses: “Europe’s current and future energy position: demand, resources, investment” Green Paper on EU energy networks RES Directive, Update nuclear progr. Proposal to revise oil stocks Directive Communication on energy efficiency TEN-E 2002-6 Communication on gas supply security Directive Proposals to revise Directives on energy performance of buildings, energy labelling, new Directive on labelling of tyres Assessment of oil infrastructures Communication on offshore wind Communication on CHP, guidelines for implementation of Directive

11. Infrastructure needs and the diversification of energy supplies Proposed energy security priorities: • Baltic Interconnection Plan • Southern gas corridor • Liquefied natural gas • Mediterranean energy ring • North-South interconnections within Central and South-East Europe • North Sea offshore grid Green Paper on European energy networks, including idea of an EU Energy Security and Infrastructure Instrument

12. Oil emergency stocks and gas crisis response mechanisms • Oil – proposal to revise EU emergency stocks legislation • Includes publishing aggregated commercial oil stocks on weekly basis • Commission to consult with a view to proposing a revised Security of Gas Supply Directive in 2010 • Greater harmonisation of security of supply standards and predefined emergency measures at regional and EU levels needed • Obligatory strategic gas stocks? - more effective options may be available

13. Energy efficiency • Nov 08 Energy Efficiency package focused on buildings and products, cogeneration/CHP • Sustainable Energy Financing Initiative, jointly with EIB; Covenant of Mayors an important instrument • 2008 Communication on Greening of Transport • International Partnership on Energy Efficiency Cooperation to be launched • 2006 Energy Efficiency Action Plan to be evaluated in 2009, with view to new Plan

14. Action Plan on Energy Efficiency – the Objective • Improving energy efficiency and realising the over 20% estimated savings potential in EU annual primary energy consumption by 2020 ( Energy Services Directive : 9% of final energy by 2016 )

15. Overview of 20% goal • Directorate-General for Energy and Transport

16.  Role of the Building Sector • 40 % of EU’s energy use • 36 % of EU’s CO2 emissions • Cost-effective energy savings potential: 28 % by 2020 • Key EU legislation: Energy Performance of Buildings Directive (EPBD, 2002/91/EC) 16/12

17.  Energy Performance of Buildings Directive EPBD (2002/91/EC) Requirements - for Member States to specify and implement: • Minimum energy performance standards for new and for existing buildings that undergo major renovation • An integrated methodology to rate the energy performance of buildings • Energy performance certificates for buildings • Regular inspections of heating and air-conditioning systems 17/12

18.  EPBD recast – What are the changes? • Principles of existing EPBD requirements are KEPT – but CLARIFIED and IMPROVED • Several ways of implementing details of the EPBD by Member States exist AND SHALL BE UPHELD • Full respect of subsidiarityprinciple and of economic feasibility 18/12

19.  EPBD: recast (1) • Elimination of the 1000 m2 threshold for existing buildings when they undergo a major renovation • Eliminating/lowering of the threshold also for- Display of Energy Performance Certificates in public buildings- Assessment on installation of alternative systems for new build • Minimum energy performance requirements for newbuildings and major renovations:Benchmarking to achieve cost-optimal levels • Strengthening the role and the quality of energy performance certificates 19/12

20. Energy Class D Energy Class D  EPBD recast – What shall e.g. happen? Energy Performance Certificate 20/12

21.  EPBD – recast (3) • Strengthening the role and the quality of inspections (HVAC) • Stimulating the market entry of low/zero carbonand energy buildings • Addressing the public sector to act as leading example • Penalties for non-compliance • Timetable • Transposition: 31/12/2010 • Implementation: 31/12/2010 and 31/01/2012 • Co-decision 21/12

22.  Impacts of the proposed EPBD recast • 5 - 6 % saving of EU's total energy consumption • 5 % saving of EU's total CO2 emissions • 280,000 – 450,000 potential new jobs • Relatively low costs • Low/zero, predominantly negative CO2abatement costs 22/12

23.  Support Instruments will be continued and enhanced • Energy Demand Management Committee • EPBD Concerted Action • Mandate for 31 European EPBD CEN standards • Buildings Platform - Build-up Initiative • Intelligent Energy Europe Programme projects • Financing: state aid exemptions + VAT reduced rates • EU's Economic Recovery Plan ( 26 Nov 08) • Structural Fund extension • European energy-efficient buildings Initiative

24. Making the best use of the EU’s indigenous energy resources • Clear , binding objective for renewables, the EU's greatest potential source of indigenous energy. • Technology is crucial; next step in the Strategic Energy Technology Plan to be a Communication on Financing Low Carbon Technologies; including ways to support large scale demonstrations at EU level ( wind, solar, bio energy etc. long-term use of coal requires highly-efficient plants and wide availability of CCS - in EU and emerging economies) • Berlin Fossil Fuel Forum to support indigenous EU fossil fuels, other fora ( Sustainable Energies etc). • Nuclear safety

25. Policy background Renewable Energies • Renewable energy promotion since 1997 • sustainability – world leadership in halting climate change • security of supply – oil & gas supply concerns, price volatility • competitiveness – world-leading innovative industrial sector • National targets for RE electricity (2001) and transport (2003) • Public discussion launched with the 2007 energy package: “20-20-20 in 2020” • 2008: Commission proposals discussed and agreed by Member States and Parliament • Renewable energy, emissions trading and targets, CCS • Entry into force of the new Directive in April 2009, to be implemented by Member States by October 2010.

26. Progress so far - patchy

27. The renewables Directive • Sets mandatory national targets for renewable energy shares, including 10% biofuels share, in 2020 • Creates flexibility by facilitating “joint projects” with Member States or third countries and “statistical transfers” between Member States to help reach targets cost effectively • Requires national renewable energy action plans • Requires reduction of administrative and regulatory barriers, improvements in provision of information and training and improves renewables’ access to the electricity grid • Creates a sustainability regime for biofuels

28. 13% 16% 13% 30% 18% 25% 16% 18% 20% 23% 17% 13% 40% 23% 11% 13% 10% 14% 34% 15% 31% 24% 25% 14% 38% 49% 15% Member States’ targets 1: Art. 3(1); Annex 1 BE BG CZ DK DE EE IE EL ES FR IT CY LV LT LU HU MT NL AT PL PT RO SI SK FI SE UK RES share in 2020 • Based on 2005 starting point, recent progress and a balanced sharing of the effort, weighted by GDP/capita

29. Member States’ targets 3: Art. 3(4) - transport • Minimum 10% share of RE in transport • (due to extreme dependency and high expected growth) • . RE in transport. energy consumption of petrol, diesel, biofuels in land transport and electricity • RE electricity in transport f(RE electricity share of EU or Member State) • RE in electric road vehicles given energy content bonus of 2.5 • biofuels from wastes, residues and second generation material bonus of 2 (c.f. Art. 21(2)) • All excluding unsustainable biofuels

30. Member States’ targets 4: Art. 2 - Definitions • Wind, solar, geothermal, aerothermal, hydrothermal, ocean energy, hydropower, biomass landfill and sewage treatment plant gas and biogas • Bioliquids are liquid biomass used for electricity or heat generation • Biofuels are liquid or gaseous biomass used in transport • The definition is intended to be broad enough to include new technologies as they develop (e.g. biomass includes fuels derived from seaweed, “ocean” includes tidal and wave power) • Nuclear power is not a renewable energy source (though it is low carbon) • Peat is not a renewable energy source • Unsustainable biofuels & bioliquids are not counted as a renewable energy source (criteria discussed later…)

31. Flexibility and cost effectiveness • No sectoral targets set, no technology-specific requirements • “Statistical transfers”: a Member State can agree to statistically transfer to another Member State a quantity of the renewable energy produced on its territory. (usually for a price/MWh). • “Joint projects”: helping to build new installations or providing finance in some other way, Member States can help other Member States and third countries to build up renewable energy production capacity and share out the resulting production to also contribute to the financing Member State’s target. • If one Member State or a third country can produce renewable energy more cheaply than another, such “trades” improve cost effectiveness.

32. Co-operation mechanisms 1 • Statistical transfers - Art. 6 • Member States make an agreement amongst themselves • Commission must be notified of quantity and price within 3 months of the end of the year in question • Joint projects between Member States - Art. 7 & 8 • Member States agree a (new) “joint project” • Commission must be notified of the Member States involved, the relevant installation, the energy to be shared, the period covered. • Within 3 months of the end of each year the Commission must be notified of quantity produced by the relevant installation and the distribution to each Member State. • In both cases the Commission adjusts the energy statistics in accordance with the notifications. • EEA and Energy Community Treaty countries could participate following adoption of the Directive in the relevant acqui.

33. Co-operation mechanisms 2 • Joint projects between Member States and third countries - Art. 9 & 10 • Member State(s) may agree a (new) “joint project” for production of electricity from renewable energy sources in a 3rd country • Electricity must be proven to be consumed in the EU • The energy produced may only receive investment aid (i.e. not production support) in the country of production • The “EU consumption” condition may be relaxed by the Commission if inter-connection capacity between a Member State and a 3rd country is to be built (construction beginning by 2016; operational by 2022) for a quantity of electricity which will be imported in accordance with the above conditions. • Following notification, the Commission will adjust the energy statistics.

34. Co-operation mechanisms 3 • Joint support schemes - Art. 10 & 11 • Member States may agree to join or coordinate their national support schemes (e.g. a common feed in tariff or green certificate/obligation regime). • The renewable energy produced under such conditions is considered “pooled” and shared out either as a “statistical transfer” or according to an agreed distribution rule of which the Commission has been notified. n.b. Commission expects national support schemes to continue to evolve and will facilitate increasing cooperation and coordination.

35. Renewable Energy Action Plans 1 – Art. 4 • National plans to be submitted by Member States by 30 June 2010 containing • national sectoral targets and trajectories (electricity, transport heating& cooling) • adequate measures to achieve the overall target • means of cooperation between national, regional and local authorities • planned statistical transfers or joint projects • To help prepare such plans • by 30 June 2009 the Commission will produce a template which Member States must use to prepare their plans • by 31 December 2009 Member States must publish “forecast documents” containing estimates of future renewable energy production in excess of their trajectory, the potential for “joint projects”, expected domestic/import production split.

36. Renewable Energy Action Plans 2 - Template • Annex VI contains minimum requirements for the template: • Data to be reported includes expected final energy consumption, sectoral targets and trajectories • with a breakdown by technology and of the expected energy efficiency and savings in each sector • Details of measures to remove administrative barriers, accelerate authorisation procedures, reinforce renewable energy integration into the energy system and the better exploitation of biomass resources in particular • Explanations of the support schemes to be used in each sector to drive development of renewable energy • Planned use of statistical transfers/joint projects and domestic/import production split. • Commission is currently elaborating the details, format etc.

37. Administrative measures 1 – Art. 13 • Member States shallensure that • authorisation, certification and licensing procedures for plants and infrastructure are streamlined, proportionate and necessary • with simplified procedures for small or decentralised projects where appropriate • responsibilities for such procedures are defined and coordinated between local, regional and national bodies, with transparent timetables and provision of information on processing and assistance • rules for these procedures are objective, transparent, proportionate and non discriminatory • associated administrative charges are transparent and cost related • Technical specifications of equipment (for support) shall be clearly defined, based on European standards and should not constitute a barrier to trade.

38. Administrative measures 2 – Art. 13 • Member States shallrecommend that • local and regional bodies ensure the use of renewable energy when planning, designing and building industrial and residential areas and infrastructure • Member States shall introduce appropriate measures in building regulations and codes to increase the use of renewable energy in buildings • including minimum levels of renewable energy in buildings • public buildings should be “show cases” • Member States shall promote energy efficient renewable energy equipment • e.g. efficient conversion of biomass, compliance with eco labels for heat pumps and solar equipment…

39.  Consumer information: guarantees of origin 1 • Guarantees of origin are certificates proving electricity is generated from renewable energy sources; based on existing regime • must be issued upon request • used and cancelled within 12 months • independent national competent body for (electronic) issuing, transfers and cancellations to ensure accuracy, reliability and fraud resistance • mutual recognition • Standardised • 1MWh, date & country of issue & unique identification n°. • date of energy production; age, location of installation • optional for heating and cooling

40.  Grid access and operation 1 – Art. 16 • Member States shall take the appropriate steps to • develop all infrastructure to ensure its secure operation as it accommodates more electricity from renewable energy sources • (transmission and distribution grid infrastructure, intelligent networks, storage facilities, interconnections) • accelerate authorisation procedures and co-ordinate with administrative and planning procedures • Subject to maintaining grid reliability and safety, Member States shall • guarantee transmission and distribution of renewable electricity • provide priority or guaranteed grid access • ensure priority dispatching (where dispatching occurs) • grid and market operational measures minimise curtailment of electricity from renewable energy sources

41.  Grid access and operation 2 – Art. 16 • Member States shall require TSOs and DSOs to • set up and make public rules of cost bearing and sharing • (connection, reinforcement, improved operation, grid code implementation costs) • based on objective, transparent non discriminatory criteria • provide new producers with the comprehensive and necessary information for connection • (connection cost estimates, reasonable and precise timetable for processing application and for connection) • Member States shall review and improve these rules by 30 June 2011 and every two years thereafter • Member States may require TSOs and DSOs to bear costs

42. What next? • Directive enters into force in May 2009, to be implemented by Member States by October 2010 • In 2009 the Commission will • produce the template for national plans, report on biomass sustainability criteria, refine biofuel sustainability criteria • In following years the Commission will • Report on indirect land use change, on areas with low agricultural GHG emissions, sustainability verification methods, and add methodologies for new RE technologies • All these aspects are evolving in conjunction with associated policies inc. emissions trading, eco-labels, buildings directive and other energy efficiency measures

43. Conclusions • Renewables policy developed with related policies • strategic energy review, emissions trading, emissions effort sharing targets, CCS, energy efficiency measures, state aid guidelines & single market developments, CAP changes, biomass/forestry developments, trade concerns, macroeconomic crisis… • Thorough discussion of issues and options during legislative negotiations • Renewable energy will be one sector of the economy where there ispolicy stability: • Targets, trajectories, sectoral growth, technology split, support measures, transparent planning and expectations • The strongest basis yet for consistent growth in renewable energy production; yielding significant GHG reductions, energy supply diversification and technological innovation

44. Europe preparing its energy future now • EU’s 2020 agenda set out first steps in transition to high-efficiency, low-carbon energy systems • Deep structural changes, radical technological shifts require choices today • Wide consultation on possible longer-term policy objectives eg decarbonising electricity supply by 2050 • Roadmap towards a 2050 Energy Policy to be prepared, in SET-Plan framework

45. ENERGY FOR A CHANGING WORLD Further information For the climate and energy package http://ec.europa.eu/energy/energy_policy/index_en.htm EC, DG TREN: RES policy & RTD programmes http://ec.europa.eu/energy/res/index_en.htm EC, DG TREN: agencies, partners, programmese.g. http://www.managenergy.net EC, Executive Agency for Competitiveness and Innovation (EACI) Intelligent Energy - Europe http://ec.europa.eu/eaci Calls for proposals FP7 http://cordis.europa.eu/fp7/dc/ http://cordis.europa.eu/eu-funding-guide/home_en.html

46. THANK YOU FOR YOUR ATTENTION !! A Low Carbon , high efficiencyFuture Increasing Dependency karl.kellner@ec.europa.eu