To achieve this target, the Council recommends the implementation of a comprehensive strategy for a massive increase in energy efficiency, as well as a high level of support for renewable energies, rapid and coordinated expansion of the gas and electricity grid infrastructure, and further development of storage capacities. Ambitious medium-term goals should therefore be agreed in all these areas. These policies will support climate change mitigation and promote energy security. The EU’s common energy policy, a source of controversy today, could thus become one of Europe’s ‘lighthouse projects’ for the coming decades.
Progressively harmonising support for renewables
An ambitious, EU-wide uniform feed-in tariff would speed up the development of a low-carbon European energy generation system and would be the most cost-effective way of decarbonising the energy system based on the largest possible share of renewables. However, this uniform feed-in tariff should be introduced only in around 10 years’ time, as the requisite grid infrastructure will need to be established first. At present, 21 EU Member States operate a system of feed-in tariffs/premiums.
The EU Member States should now agree, on a binding basis, on the introduction of feed-in tariffs for renewables in all EU countries and the progressive harmonisation of existing promotion schemes over the coming years. This would lessen the risk of over-expansion at less suitable sites, thereby reducing costs, while also speeding up renewables expansion at favourable sites. The EU should pool its renewable energy potential continent-wide: wind energy could be obtained from the North Sea and the Baltic Sea, biomass from eastern Europe, solar from southern Europe, and systems expertise for the expansion of trans-European networks from Germany and other technologically advanced countries. In the medium term, a single promotion scheme should be introduced which combines the goals of energy efficiency and cost-effectiveness.
Driving grid expansion
WBGU cautions against the immediate introduction of an EU-wide uniform feed-in tariff, however. Until transnational transmission infrastructures for renewable-generated power are established, there is a risk that electricity will be produced at favourable sites but cannot be transmitted to consumers. This would slow down the expansion of renewables in regions with less favourable conditions, thereby increasing the likelihood of a switch to less sustainable forms of energy. For that reason, a key prerequisite for EU-wide harmonisation of feed-in tariffs is accelerated grid expansion. The EU should therefore embark on a coordinated grid expansion programme with a view to establishing the necessary conditions for the achievement, by mid-century, of a power supply for Europe which is based almost entirely on renewables. To that end, the EU must gain the requisite legislative powers. The EU-wide harmonisation of feed-in tariffs should proceed in step with grid expansion. It is particularly important to avoid any phases of investment uncertainty, as this would hamper the overall expansion of renewable energies. It is also important to maintain key elements of Germany’s Renewable Energy Sources Act (EEG), such as the priority given to the feed-in of green electricity and guaranteed support for individual generation facilities for a specific time period. The level of support provided for new facilities should be dynamic so that the desired capacity addition rates can be achieved without excessive support at favourable sites.
Moving beyond national industrial policy interests
In view of the challenges presented by climate change, the increasing dependency on fossil fuel imports, and rising energy prices, an energy turnaround in the EU is urgently needed. The ‘Europeanisation’ of energy policy should therefore aim to optimise the expansion of renewable energies, harness the full potential for innovation, and identify the most cost-effective solutions. A common European energy policy would also have great symbolic significance and would underscore Europe’s commitment to joint action in key future-oriented policy fields while boosting the EU’s competitiveness. The effects would radiate into the world economy. It must be borne in mind that the European Union – originally the European Coal and Steel Community – was founded and its political identity shaped on the basis of fossil energies. Today, energy and industrial policy initiatives in the field of renewable energies can generate similar impetus for the deepening of the European Union and its influence in the world economy and global politics. Short-term national industrial policy interests must be subordinated to these overarching goals. WBGU assumes that renewable energies such as solar thermal, photovoltaic, wind and biomass – once a global capacity of around 5,000 TWh is achieved for each of these sources – will be competitive without support measures, which means that the EU promotion scheme can be phased out over the long term.
Opportunities to involve North Africa
WBGU recommends that in the medium term, international cooperation be expanded beyond the European Union’s borders. To that end, consideration should be given to the opportunities to integrate North Africa in a system of European feed-in tariffs. This could offer scope to harness additional capacities, especially solar and wind energy, while supporting the energy turnaround in the countries of the Maghreb. The prerequisite for North Africa’s involvement, however, would be a transcontinental high-voltage grid, but this is unlikely to become a reality before 2030. A new trans-African grid would be also required to bring the energy from Maghreb to the Sub-Saharan region where 500 million people live without access to electricity.
New flagship report
On 22 March 2011, WBGU will submit its new flagship report, Transformation towards a Low-Carbon Society, to the German Government. The report maps out a course for the transformation to a low-carbon society.