As world leaders gather in Copenhagen to thrash-out a roadmap to prevent the human race sleepwalking into climate catastrophe, Europe’s legislators are wondering how the EU will achieve its own 2020 renewable energy targets.
By John Foster
Additional reporting by Rikki Stancich
The European Union is committed to generating 20 percent of its energy needs from renewable sources by 2020.
This is shaping up to be a major challenge and will only be achieved by significant cross-border investment argues Cecilia Hellner, secretary-general of the European Transmission Systems Operators lobby.
Europe’s 2020 renewable energy target is a double-edged sword.
While achieving this target will come at a considerable financial cost, it will be partly offset by the creation of new jobs and economic activity across the Union in the renewable sector.
In the wind power sector alone, the European Wind Energy Association predicts the number of jobs created across the EU will reach 325,000 by 2020 - more than double the 150,000 jobs in the sector in 2007.
Add solar, hydro, biomass and geothermal to this mix, and Europe could become one of the leading employers in the renewable energy industry.
The 2020 targets have the potential to turn Europe into one of the world’s foremost energy producers, not just one of the world’s major energy consumers.
This will only happen if the EU embraces the ‘home-grown’ resources it has not yet over-exploited, creating a collaborative structure, with joined-up-thinking and executable deadlines when its member states compose their National Action Plans in March 2010.
However, many Europeans are looking beyond the continent to North Africa and the Middle East as a source of renewable electricity imports to achieve these targets.
The relative proximity of North Africa and the fact that most of its land mass is the Sahara Desert makes the concept of importing electricity generated from here through solar and wind attractive.
Desertec – a projected €400bn mixed solar and wind project that claims it will be able to provide 15 percent of Europe’s energy by 2050 – aims to use the most advanced CSP along with photovoltaic systems and wind parks in 17,000km2of the Sahara.
The electricity it generates would be transmitted to Europe by a super grid of high-voltage direct current cables.
The project - should it get off the ground - could have significant benefits in the 21st Century ‘World War on Carbon’. The costs are less than the £850bn bailout package for British banks in 2008, or the US$1 trillion that the US spent supporting its financial system.
Critics of programs such as Desertec claim that the EU is just handing energy security from the Gulf States of the Arabian Peninsula and Russian gas barons, to the Arab nations of North Africa. Others argue that, in any case, the idea is infeasible.
"Sahara power for northern Europe is a mirage," Hermann Scheer, a member of Germany's parliament and head of the European Association for Renewable Energy told Reuters earlier this year.
"Those behind the project know themselves that nothing will ever come out of this," said Scheer, adding that the costs of Desertec were being downplayed artificially and its technical capabilities over-estimated.
Is Spain the answer?
Spain, however, is often over looked as a possible source for Europe’s renewable energy needs.
Compared to the potential North African CSP market, Spain is well positioned to service the renewable energy needs of other EU member states, with some 2,095 MW of CSP under construction and a further 1,800MW of projects in the pipeline. These are projects that have already completed their EIS requirements, have procured land, secured grid connection rights and now await only funding.
“If foreign investors pay the difference between the conventional price of electricity and the amount needed for plant construction, [these projects] can happen tomorrow,” urges Luis Crespo, secretary general of Protermosolar, a concentrated solar power industry association in Spain.
Crespo points out that the amount of investment required to install subsea cables linking North Africa to Europe, coupled with transmission losses and the requisite level of political cooperation, threaten to render the Desertec project unviable.
Linking Spain to the rest of Europe would be comparatively easier and cheaper, he argues.
The benefits would work both ways. Investment from EU member states would not only jumpstart a raft of Spanish CSP projects, it would also trigger considerable demand for components from Northern European suppliers, such as Germany and Sweden. This, in turn, would bolster employment in the manufacturing sectors of these countries, says Crespo.
Spain was Europe’s boom market for photovoltaic in 2007 and 2008 with installations of 2.6GW in 2008, which made Spain the largest PV market in the world in that year.
But this position was only achieved through the loophole of an unintentionally generous grants policy, which has now been revoked due to high costs, with the incentives restricted to 500MW/year for the next few years.
According to Jenny Chase, manager, solar insight, of New Energy Finance, a similar boom is taking place in solar thermal electricity generation today due to the same policy, although it has been limited to 2.4GW total through requiring projects to be on a ‘pre-inscription register’.
This 2.4GW to be built in the next few years makes Spain a world leader in new build solar thermal, but there is no guarantee the market will continue beyond that.
Chase explains that while Spanish construction and infrastructure companies are gaining valuable expertise in building and operating solar thermal plants and have had some success exporting the technology, most of the Spanish solar thermal plants use technologically conservative parabolic trough technology, and are very expensive.
There would certainly be no market without RD661/2007, the Spanish law that governs feed-in tariffs, and there may be no market when RD661/2007 and its amendments expire, sometime after 2013.
That is why the EU cannot rely on Spain to meet its 2020 targets.
The North Sea solution
However, there is a light on the horizon, but it is less likely to be sun, than it is wind and water. On December 7th, nine EU members (Germany, France, Belgium, Holland, Luxembourg, Denmark, Sweden, Ireland and the UK) signed an agreement to develop Europe's first offshore wind grid in the North and Irish seas.
“This very ambitious project is not just of interest to the countries bordering the North seas. It is important for the future energy mix providing the needs of the European Union," says Paul Magnette, climate minister of Belgium, which initiated the scheme.
Drawing on its hydro resources, Norway is well positioned to provide balance to North Sea offshore wind. "The interesting point here is how Norwegian hydropower capacity, based on water reservoirs, can be utilised as swing, or balancing power for renewable energy on the continent," says Gunnar Romsaas, spokesperson for Statnett.
Norwegian operator, Statnett is currently working on a North Sea cabling project with the UK National Grid.
Other cabling projects to be rolled out between now and 2020 will link Norwegian hydro to electricity sources in Denmark, Germany, and the Netherlands, representing a total investment of NOK 32 billion (€37bn; US$5.6bn), of which Statnett’s share will be NOK 16 billion (€1.9bn; US$2.7bn).
These connections will increase the capacity by approximately 4 000 MW between Norway and the continent, says Romsaas.
Skeptics in the industry, however, say the EU will have no choice but to import its energy. Nigel Meir, manager of clean tech fund, Ludgate Environmental, says: “The problem with renewables in Europe is that we can’t produce enough energy with the technology we have at the moment, and the resources we have got.
“The British government wants a large proportion of its electricity generated from offshore wind. But the resources it has cannot supply its own needs, never mind exporting electricity. Each country needs to build up its own domestic renewable production, from a diverse range of sources.”
Agreements such as that of the development of an offshore grid in the North and Irish seas provide a strong example for other cross-border co-operation initiatives. But with the climate clock ticking and 2020 approaching, European ministers will have to do a lot more head scratching to establish how they are going to achieve their renewable targets.