THE PERFORMANCE OF EU NEW ENERGY INCENTIVES

Status of Feed-in Tariffs in Europe 2010; FITs Predominate in EU Renewable Energy Policy, Most Wind & Biogas Developed with FITs, All Solar Developed with FITs, FITs Least Cost Wind Policy
Paul Gipe, February 11, 2011 (Wind Works)

"The use of feed-in tariffs (FITs) to pay for renewable generation now overwhelmingly dominates European renewable energy policy, according to the most recent meeting of the International Feed-in (tariff) Cooperation council (IFIC)…There are now 27 countries in the European Union since the accession of several former East Bloc countries…20 of 27 EU states use FITs as the main renewable energy program…3 of 27 EU states also use FITs for certain technologies, such as solar PV in Italy…Only 4 of 27 EU states don't use FITs at all…

"…85% of all new wind systems since 1997 have been installed with FITs in the EU…Nearly 100% of all new solar PV systems since 1997 have been installed with FITs in the EU…68% of all new biomass generation since 1997 in the EU have been installed with FITs…Feed-in tariffs are the most cost-effective renewable policy in Europe, and…Feed-in tariffs remain the most important measure for EU nations to meet EU renewable targets."

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"In 1997, there were some 5,000 MW of wind generating capacity installed in Europe. By the end of 2009 there was 77,000 MW…[so] as much as 60,000 MW of wind capacity [has been] installed in Europe with feed-in tariffs. A fleet of this size is capable of generating more than 120 TWh per year and represents a private investment of more than $120 billion…

"…[O]nshore wind energy feed-in tariffs were more cost-effective than other policy mechanisms and especially more so than quota systems, such as renewable energy standards…United Kingdom (UK), [Italian (IT) and Belgian (BE)] consumers, [under Renewable Obligation standards] were paying far more for wind energy than necessary to build profitable projects…"

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"…Germany (DE), France (FR), and Spain (ES) [under FiTs] pay only what's necessary to develop a profitable project…[A] similar study that was published by the EU in 2005…found the same results…[T]he French system of differentiated tariffs for wind energy based on resource intensity [also used in Germany and Switzerland]…reduces the cost of wind energy to consumers…

"Historically, there has been more local ownership of renewable generation in jurisdictions that use feed-in tariffs. More than half of the 43,000 MW of renewable generators in Germany are owned by farmers or local investors."