WP4: 2030 (RES) targets & effort sharing
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1 WP4: 2030 (RES) targets & effort sharing Authors: Anne Held, Mario Ragwitz, Simone Steinhilber, Tobias Boßmann Fraunhofer ISI Contact: Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 1
2 Overview of the work package Core objective(s) Identify, analyse, and summarise the consequences of different ambition levels regarding the 2030 RES targets Identify options for sharing costs and benefits between Member States Contribute to the discussion about how to break down the 2030 RES target Outputs O4.1: Identification of different target setting options O4.2: Suitability of target setting approaches from a stakeholders perspective O4.3: Toolbox of feasible target setting approaches based on qualitative and quantitative assessment O4.4: Contribution to issue paper, interim report and final report(s) Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 2
3 First results: Identification and qualitative analysis of target setting (1) Target design elements Target setting procedure/design of target Ambition level Reference value Exactness of target Application level (sectoral) Bindingness of target Burden sharing Application level (geographic) Target allocation procedure (top-down, bottom-up, pledging, benchmarking, supercredits, pledging-proportionate financing) Target setting flexibility Geographical target setting flexibility Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 3
4 First results: Identification and qualitative analysis of target setting RES-target on EU-level Application level (geographic) Target allocation procedure Application level (sectoral) Bindingness of target Target setting flexibility Target achievement flexibility EU target not applicable GHG target plus RES target Binding Fixed not applicable Effort shared across all EU electricity consumers. Related to GDP? Who is held (legally) responsible in case the target is not achieved? Are additional voluntary RES support schemes allowed for MS Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 4
5 Towards2030-dialogue Implementing the EU climate and energy framework - 2nd issue paper Policy recommendations 1. Moderate dedicated support for renewables is required to reach the 2030 target of 27% renewables. 2. Benchmarks of how to break down the EUwide target to member states should be provided in order to encourage sufficiently ambitious pledges. 3. The concept of an Energy Union can be developed further by supporting regional targets for renewables and grid infrastructure. Contributors: Fraunhofer ISI, CEPS, TU Vienna, Ecofys, REKK Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 5
6 Implementing the EU climate and energy framework The ambition level of the 2030 target on EU-28 level In terms of the resulting macroeconomic impacts the agreed target of 27% is only moderately ambitious In terms of overcoming economic and non-economic barriers the ambition level of a 27% target should not be underestimated due to the need for replacement of RES plants build before 2010 ð Moderate but dedicated support for renewables will be required to reach the 2030 target of 27% renewables Increase of RES-E generation by decade [TWh/a] to to 2030 Net and gross increase of renewable electricity generation at EU level by decade ( vs ) Net increase Gross increase Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 6
7 Implementing the EU climate and energy framework How to break down the EU wide target? EU target allocation to smaller regional entities via top-down or bottom-up approach Under a top-down allocation individual targets typically sum up to the overall target of 27% Individual (bottom-up) pledges may fall short of the overall EU-target => in this case financing mechanism or iteration of pledges would be required to close the gap Benchmarks by the EC (on regional or national targets) could better guide the pledging procedure and require MS to specify a higher or a lower target Combining national or regional pledges with a top-down benchmark provide quantitative indication for a potential national or regional target A first benchmark could be based on the logic of the 2020 target allocation (flat-rate increase + econ. strength + past efforts) + other transparent criteria (costs, potentials) ð EC should publish benchmarks /indicators of how to break down the EUwide target. ð EC would encourage sufficient pledges of member states. Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 7
8 Implementing the EU climate and energy framework Options to break down the EU wide target: 2020 allocation method Pure flat-rate approach GDP-based approach (default) GDP-based approach (modified) Potentials-based approach Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 8
9 Implementing the EU climate and energy framework How to break down the EU wide target? Base case is the 2020 allocation method 60% 55% 50% Possible breakdown of 2030 renewables target Increase in renewables share compared to % 40% 35% 30% 25% 20% 15% 10% 5% 0% EU-28 Austria Belgium Bulgaria Croatia Cyprus Czech Republic Denmark Estonia Finland France Germany Greece Hungary Ireland Italy Latvia Lithuania Luxembourg Malta Netherlands Poland Portugal Romania Slovakia Slovenia Spain Sweden United Kingdom Share in gross final energy demand by 2030 [%] Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 9
10 Implementing the EU climate and energy framework How to break down the EU wide target? Base case is the 2020 allocation method Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 10
11 Implementing the EU climate and energy framework 2020 allocation method is based on ratio of GDP and TFEC Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 11
12 How to break down the EU wide target? Deviation of the flat-rate benchmark from the 2020 allocation method in percentage points à countries with higher GDP per TFEC get (slightly) lower relative targets Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 12
13 How to break down the EU wide target? Deviation of the GDP-based benchmark (default) from the 2020 allocation method in percentage points à countries with higher GDP per TFEC get (slightly) higher relative targets Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 13
14 How to break down the EU wide target? Deviation of the flat-rate benchmark from the 2020 allocation method in percentage points à countries with higher GDP per TFEC get (slightly) higher relative targets Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 14
15 How to break down the EU wide target? Deviation of the GDP-based benchmark (modified) from the 2020 allocation method in percentage points à countries with higher GDP get higher relative targets Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 15
16 Regional targets as a step towards an Energy Union Energy Union Communication (Feb. 2015): EC will facilitate cooperation and convergence of national support schemes encourages regional approaches to ensure compatibility with internal energy market Top-down vs. bottom-up convergence Top-down: prescription of specific types of instruments, harmonised EU-wide support scheme Bottom-up: increased coordination of national policies, regional RES support schemes In terms of target allocation: regional targets as a first step towards policy convergence and an Energy Union Groups of several MS could pledge themselves to a joint or regional target Regional targets require coordination of national energy policies MS would assess and understand cross border effects => enables more integrated planning approach of supply and grid infrastructure (avoid loop flows) Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 16
17 Lessons learned from energy efficiency policy The scope of EU legislation in renewable policy is more limited (EE policy builds different legislations, such as EED, EPBD, Ecodesign) It does not allow for corrective measures as realised in energy efficiency policy (forcing MSs to improve their implementation record) Alternative areas for providing leverage guaranteeing target achievement should be considered: Setting a benchmark for MS pledges, ideally in a legally binding manner, Linking EU incentives for infrastructure development to MS pledges Interlinkage between the two policy fields: more ambitious energy efficiency policies reduce the volume of renewable production required to reach the 2030 renewable target! Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 17
18 Summary and next steps Further discussion on the implementation of benchmarks needed Discuss MS position of different approaches (2020 approach, pure GDP, pure flat rate, alternative GDP approach correcting for energy intensity) Elaboration of regional concepts (e.g. ACER security of supply regions (adequacy assessment) voluntary regionalisation of TSOs, ENTSO-E policy paper) Historical examples of what has worked and what not Differentiate between heat and electricity market (impact of NREAPs on national planning and policies) 2010 (2001/77/EC) and 2020 experience Differentiate between geographical distribution of installations and effort (cooperation in between) Coordination with infrastructure development between countries needed Increasing certainty on (regional, national) RES target commitment will be beneficial for DSOs and TSOs Frame for newcomers by providing planning certainty Towards2030-dialogue mid-term conference Brussels, 12 November2015 Slide 18
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