Prof. Arthouros Zervos President European Renewable Energy Council

1. 20 % renewable energy by 2020 – the RES industry’s point of view on the Draft Renewable Energy Directive Prof. Arthouros Zervos President EuropeanRenewable Energy Council Inter-Parliamentary Meeting on Renewable Energy and Energy Efficiency Brussels, 29th January 2008

2. How it all started…January 2004 EREC published the industries new goals for 2020

3. EREC – European Renewable Energy Council Umbrella organisation representing all RES sectors: • AEBIOM European Biomass Association • EGEC European Geothermal Energy Council • EPIA European Photovoltaic Industry Association • ESHA European Small Hydropower Association • ESTIF European Solar Thermal Industry Federation • EUBIA European Biomass Industry Association • EWEA European Wind Energy Association • EURECAgency European Renewable Energy Research Centres Agency Associate members: • EU-OEA European Ocean Energy Association • EBIO European Bioethanol Industry Association • EREF European Renewable Energy Federation • ESTELA European Solar Thermal Electricity Association Representation of European RES industry, trade & research

4. The Root of the Energy Problem for the EU • If we do not counteract, we are importing an ever growing share of our energy at unpredictable (but most likely higher) prices in competition with the rest of the world and at unbelievable environmental cost. • Regardless of whether we are successful in energy diplomacy or not, we have no idea about the future cost of fossil and nuclear energy we will be paying to maintain current supply.

5. We are already paying for inaction • For every $20 increase in the price of oil, the cost of Europe’s gas imports rises by €15 bn annually, given the unfortunate link between oil and gas prices • The increase of oil prices over the past few years from $20 to $80 thus adds €45 bn. to EUs annual gas import bill • For comparison, EU invested €9 bn. in wind energy in 2006

6. The forgotten COST: The REAL PRICE of our energy supply Who is paying the real price? The Electricity/Energy customer The general population Indirect burden via taxes, insurances and social contributions The State Increasing environmental costs, „political“ costs Global Loss of quality of life Electricity/Energy Price External Costs

7. From Coal&Steel and Nuclear To Security of Supply Competitiveness Sustainability EU Energy Policy

8. The senseless battle of „market versus the environment“ must become a battle of „markets for the environment“ The markets for the future are green!

9. RES 2020 Target and Climate Change Package The targets on renewable energy (including a mandatory biofuels target), energy efficiency and greenhouse gases have been agreed for 2020 None of these targets has primacy over the others.

10. The 20% by 2020 EU target will only be met if legislation is adopted timely.The Directive should be in force as soon as possible in order not to cause market instability around 2010 (ending of RES-E & Biofuels Directives) Member States and the European Parliament have to follow their own commitments - NOW The Framework Directive must be adopted as soon as possible.

11. Division of the 20% target among Member States How to best avoid lengthy negotiations ? It seems the Commission managed quite well in dividing the numbers…only Belgium, Sweden, Austria and Latvia do not want to see the great opportunities in renewables development

12. Pre-Conditions for RES uptake Change in Paradigm: individual responsibility for own energy supply, as local and decentralised as possible Households and private sector in general should primarily produce their own heat and electricity from RES sources in an efficient environment Combination with drastic change in consumption pattern and increase in efficiency Political commitment beyond ideologies and short term thinking to go for strong national RES development Clear instruments, targets for rapid uptake and enforcement High level of market penetration by Independent RES Power Production Swift abatement of open and hidden harmful subsidies to incumbent industry As long as one or more of these conditions are not met – counterbalance is necessity

13. RES Framework Directive must contain: Electricity: • Existing RES-E Directive should form the minimum starting point. • Provisions on grid issues and administration procedures must be strenghened. Heating/Cooling: • Renewable Heat obligation for new buildings • Coherent stable support measures • Removal of administrative barriers • Reliable statistics for RES-heating • Specific measures to promote RES cooling Transport: • Definition of sustainability standards of biofuels

14. Precondition for reaching the targets Renewable Action Plans with sectoral targets for RES-electricity, RES heating & cooling Biofuels Interim targets every second year to check whether development is on track Penalities for MS in case of not reaching the target Ensuring: development of ALL renewable energy technologies

15. EU wide Trading Mechanism There is no reason to introduce such an artificial mechanism if it is meant to: produce disincentives for domestic investment endanger prosperous support schemes provide additional bureaucratic mechanisms

16. An exchange of guarantees of origin must be based on the following principles: • A trading mechanism must be regulated and operated by public authorities on a Member State level only and not on a company level. Since Member States are responsible for meeting the target, they should retain control over the target and not leave it to companies • If a Member State wants to sell renewable energy certificates abroad, it must already have fulfilled its own national target. Thus, exporting guarantees of origin to another Member State should be allowed only after the exporting country has met its national intermediate target: a country should not be able to sell something which it does not possess.

17. Expectations from the RES Framework Directive for RES-heating & cooling • Include binding sectoral targets for heating & cooling in the National Action Plans • New buildings & major renovations: apply a renewable heat obligation • All other heat & cold consumption points: coherent, long-term oriented set of measures • Launch specific support for renewable cooling • Measures to promote RES integration into district heating systems • Product eligibility for support schemes based on EU standards & certification

18. Strong Sustainability Criteria • Sustainability criteria should cover not only biofuels but also biomass whatever its final use (biofuels, food, construction, electricity...) • No biomass outside these sustainability criteria should be counted towards the target. - Imported products should comply with similar standards as the cross compliance rules to avoid competition distortion.

19. Renewable Energy Technology Roadmap 20 % by 2020

20. Renewable Energy Policy Conference17 November 2008, Paris Conference organised in the framwork of the French Presidency of the European Council Further infos: www.erec.org

21. Thankyouverymuch for your attention! • EREC • European Renewable Energy Council • Renewable Energy House • 63-67 Rue d’Arlon, • 1040 Brussels, Belgium • www.erec.org