Adoption by the European Commission of its June 2012 Communication 'Renewable Energy: a major player in the European energy market' - steps towards achieving a medium- and long- term renewable energy policy beyond 2020

On 6 June 2012, the European Commission (‘Commission’) adopted a Communication entitled ‘Renewable Energy: a major player in the European energy market’ (‘June 2012 Communication’),[1] which was based on the outcome of two preparatory documents.[2] From an economic point of view, the Commission claims that an important increase by 2030 of EU’s share of renewable energy could result in the creation of 3 million jobs.[3] On a more political level, the Commission argues that a strict transposition of the Renewable Energy Directive (‘RED’),[4] which is aimed at achieving the 20% renewable energy target by 2020, needs to be combined with a clear long-term policy on renewable energy.[5]

In order to properly integrate renewable energy into the internal market, the Commission wishes to encourage further action around three axes: (i) development of the carbon market; (ii) improvement of support schemes; and (iii) increase in the level of trade in renewable energy.[6]

As for the first axis, the Commission takes the view that optimal investment conditions in the area of renewable energy presuppose “a well-functioning carbon market”, “properly designed energy taxes” as well as the gradual reduction of State support to the renewable energy market.[7]

With respect to the second axis, the Commission voices its concern that the divergence in national support schemes might generate barriers to market entry, slow down business development and ultimately weaken the single market. In order to address this concern, the Commission commits to issue guidelines on best practice regarding the elaboration of national support schemes, which may include a chapter on support scheme reform so as to make national approaches more compatible with one another.[8]

As far as the third axis is concerned, the Commission notes that EU Member States (‘Member States’) so far have produced their own renewable energy resources and furthered their own emission reductions without sufficiently trading in all forms of renewable energy. Illustrative of this trend is the little use made by Member States of the cooperative mechanisms (statistical transfers between Member States, joint projects between Member States and/or between Member States and third countries, and joint support schemes between Member States) provided for under the RED, despite the fact such mechanisms could allow Member States to save up to 8 billion EUR a year.[9]

To address this concern, the Commission is planning to issue guidelines on trade in renewable energy, which would facilitate the use of RED’s cooperative mechanisms between Member States and between Member States and third countries (especially with Southern Mediterranean and Northern African countries), by, for instance, encouraging more convergence between Member States’ respective national support schemes.[10]

In the June 2012 Communication, the Commission also emphasizes the importance of ‘smart metering’ whereby consumers would be in a better position to assess the price they are paying for electricity “in the real time” and to decrease their energy consumption.[11]

The Commission makes it clear that GHG reductions and air quality can be enhanced by coupling an increase in EU’s renewable energy share with greater energy efficiency. However, greater reliance on renewable energy sources may also have sustainability implications (e.g., possible impacts on biodiversity). The Commission will undertake studies accordingly on how effective sustainability criteria found in the EU’s current energy-specific rules (i.e., RED and Fuel Quality Directive[12]) are, and publish reports/proposals with a view to ameliorating EU’s sustainability framework.[13]   

The Commission, as in its previous Roadmap 2050, insists on the need to envisage policy options for ‘concrete 2030 milestones’, which may be summarized as follows: (i) decarbonisation not accompanied by any renewable energy target but based on a revised ETS regime; (ii) continued renewable energy regime accompanied by binding renewable energy targets, GHG emission reductions and energy efficiency targets; and (iii) a “more harmonized management of our whole energy sector” combined with a binding renewable energy target.[14]

In its Impact Assessment Document accompanying the June 2012 Communication, the Commission announced the results of the public consultation which its Directorate General for Energy had launched on 6 December 2011 and in relation to which more than 400 contributions by stakeholders had been made.[15]

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