Gleanings from the web and the world, condensed for convenience, illustrated for enlightenment, arranged for impact...

The challenge now: To make every day Earth Day.


  • ORIGINAL REPORTING: Mixed-ownership models spur utility investment in microgrids
  • ORIGINAL REPORTING: How the wind industry can continue its boom into the 2020s
  • ORIGINAL REPORTING: Rhode Island targets a common perspective on DER values

  • TODAY’S STUDY: The Way To Grow EVs
  • QUICK NEWS, April 25: Private Sector Takes Over The Climate Fight; How Sea Level Rise Would Change The Map; Wind Jobs Top 100,000 As Wind Energy Booms

  • TODAY’S STUDY: The Risk Of Natural Gas Vs. The Risk Of Wind
  • QUICK NEWS, April 24: The Health Impacts Of Climate Change; New Energy Is Everywhere; Study Shows LA Does Not Need Aliso Canyon

  • Weekend Video: How To Win Friends For New Energy
  • Weekend Video: The Electric Vehicle Highway
  • Weekend Video: Wind And The Economy

  • FRIDAY WORLD HEADLINE-A Deeper Look At The Heat
  • FRIDAY WORLD HEADLINE-Wind Gets Market Tough
  • FRIDAY WORLD HEADLINE-UK Gets Utility-Led Solar Plus Storage
  • FRIDAY WORLD HEADLINE-Germany’s VW Talking Its EV To China


  • TTTA Thursday-U.S. Military Affirms Climate Change-War Link
  • TTTA Thursday-Solar Plus Hydro Drive Wholesale Power Cost Sub-Zero
  • TTTA Thursday-Wind Boom Goes On Growing Midwest Wealth
  • TTTA Thursday-More Kentucky Jobs In New Energy Than In Coal
  • --------------------------


    Anne B. Butterfield of Daily Camera and Huffington Post, f is an occasional contributor to NewEnergyNews


    Some of Anne's contributions:

  • Another Tipping Point: US Coal Supply Decline So Real Even West Virginia Concurs (REPORT), November 26, 2013
  • SOLAR FOR ME BUT NOT FOR THEE ~ Xcel's Push to Undermine Rooftop Solar, September 20, 2013
  • NEW BILLS AND NEW BIRDS in Colorado's recent session, May 20, 2013
  • Lies, damned lies and politicians (October 8, 2012)
  • Colorado's Elegant Solution to Fracking (April 23, 2012)
  • Shale Gas: From Geologic Bubble to Economic Bubble (March 15, 2012)
  • Taken for granted no more (February 5, 2012)
  • The Republican clown car circus (January 6, 2012)
  • Twenty-Somethings of Colorado With Skin in the Game (November 22, 2011)
  • Occupy, Xcel, and the Mother of All Cliffs (October 31, 2011)
  • Boulder Can Own Its Power With Distributed Generation (June 7, 2011)
  • The Plunging Cost of Renewables and Boulder's Energy Future (April 19, 2011)
  • Paddling Down the River Denial (January 12, 2011)
  • The Fox (News) That Jumped the Shark (December 16, 2010)
  • Click here for an archive of Butterfield columns


    Some details about NewEnergyNews and the man behind the curtain: Herman K. Trabish, Agua Dulce, CA., Doctor with my hands, Writer with my head, Student of New Energy and Human Experience with my heart




      A tip of the NewEnergyNews cap to Phillip Garcia for crucial assistance in the design implementation of this site. Thanks, Phillip.


    Pay a visit to the HARRY BOYKOFF page at Basketball Reference, sponsored by NewEnergyNews and Oil In Their Blood.

  • ---------------

  • Inside The White House Fight On Climate
  • New Energy Is The Jobs Engine
  • Wind Industry Boom Getting Bigger
  • Funding Better Transportation

    Monday, November 03, 2014


    Subsidies and costs of EU energy; An interim report for the European Commission (EC)]

    10 October 2014 (Ecofys)



    The way energy markets function and the effect of government interventions in the European Union has been the subject of much debate in recent years. To date however, there has not been a complete dataset for the EU28 detailing the Government interventions in the energy market. This report presents the results of a study commissioned by DG Energy to quantify the extent of public interventions in energy markets in all 28 Member States for all energy use excluding transport. One of the reasons Governments have to intervene in energy markets is that the market does not adequately price external costs such as environmental damages. In this project we also estimate the monetary value of environmental impacts from the use of energy. Finally, the study gives an indication of energy costs and prices, which is useful to provide context to the quantifications of interventions and external costs.

    More specifically we report:

    1. Historical and current data on public interventions in the energy market in all EU Member States and the EU overall. These interventions may regard the production and consumption side of energy products and carriers, as well as the energy system. The focus is on those measures that impact energy costs and energy market prices paid by consumers in 2012. Recent developments in policy will have an impact on future prices but not retrospectively on 2012 prices.

    2. Monetary values for environmental impacts from the energy system that are not internalised in the price. Apart from these negative impacts energy has many benefits such as employment and tax revenues. However, these benefits are private and are reflected in the prices, so unlike the impacts we consider, these are not external.

    3. Energy cost data covering capital and operating costs of different electricity and heat technologies. The cost analysis is used to put the subsidies and external costs in context. The cost data on technologies is complemented by estimates of national energy transmission costs. Both costs and external costs will vary in future in response to changes in the energy system such as a higher proportion of renewable energy, unconventional fossil fuel sources such as shale gas and/or changing energy demand and demand patterns. However, these changes are not affecting prices now. This study explicitly does not unravel retail price compositions.

    This study is the first to provide consistent data on energy costs and subsidies for all EU Member States and for all technologies.


    This study shows that in 2012, the total value of public interventions in energy (excluding transport) in the EU-28 is €2012 122 billion (see Figure S - 1). This figure is composed of the value of public interventions in 2012 of €2012 113 billion and a central estimate of direct historic support of €2012 9 billion (direct historic support is between €2012 3 and 15 billion). The direct historic support still has a direct effect today.

    The energy mix as it exists now has associated external costs of €2012 200 billion, with a range of €2012 150-310 billion (see Figure S - 1). To put these numbers into context: the total cost of this energy would be around €2012 500 billion, based on wholesale/spot prices1 . The cost to consumers would be even higher than this because retail prices are higher than wholesale prices. Interventions to support renewable energy sources have the highest value (€2012 41 billion). Support for energy demand is significant (€2012 27 billion). Support to energy efficiency is €2012 9 billion.


    In this study we monetised public interventions by Member States and the EU as a whole in the energy market. We present annual values of over 700 interventions in 2012. These regard payments made or revenues foregone as stipulated by all regulations in force, including regulations that were enacted in the past. The information on the specific interventions was collected by our partners in the Member States according to a tier system defined at the start of the project.

    For most interventions, national sources of information such as national balance sheets were available. Where these sources were not available the intervention values were calculated according to a specified methodology.

    Public interventions in the energy market have been occurring for decades and some still have an impact on energy prices in today’s markets. Much of the current energy infrastructure was developed in a time when there was significant public (national or local government) ownership and central planning.

    In addition to the monetisation of public interventions for the years 2008 - 2012 discussed above, we provide an estimate of historic interventions that are still having an effect on the energy market today. The approach to estimate these interventions is different to that for the years 2008 - 2012. The changing structure and priorities in the energy sector makes the definition of what was a subsidy very difficult for some categories. We have adopted an approach to estimate those subsidies but it must be recognised that this is subject to a high degree of uncertainty in both the methodology and data.

    Figure S – 2 shows the total value of current interventions in 2012 for energy production of 14 different technology categories and separately for energy demand and energy savings. The largest single category of intervention is for energy demand which covers measures that would encourage the use of energy such as tax reductions for particular users. In general, support to energy demand tends to support individual fuels in proportion to their place in the fuel mix, which in the EU is still dominated by gas, coal and nuclear. Support to production of electricity or of primary fuels such as coal, gas and oil makes up almost 70% of the total support. Of this, most support is given to the renewable energy technologies, particularly solar, although significant support is also given to coal and nuclear, including decommissioning and waste disposal. Support to energy savings (i.e. for reducing energy use) is around 8% of the total.

    We also present breakdowns of interventions by Member States and technology, both in absolute value (Figure S – 3) and divided by the total primary energy demand of the Member State (TPED) as a measure for domestic energy demand (Figure S – 4)2.

    For historic subsidies, we distinguish three types of interventions: ones that relate directly to capacity that is still operating in the market today (‘direct historic support’), ones that indirectly affect the development of capacity such as research and development (‘indirect historic support’), and ‘other historic support’ which does not have a direct impact on markets today, see Figure S – 5.

    Direct historic support: Before liberalisation much of the infrastructure was built by Government or Government owned companies. It is plausible to argue that some of this infrastructure would not have been built without the implicit transfer of risk to Government. Typically, this would apply to the more capital intensive projects such as coal, hydro and nuclear. This transfer of risk can be classed as an intervention (although it is not a direct transfer of money). An estimate of the effect can be made by calculating the difference in levelised cost with the lower rate of capital for Government and with commercial rates of capital. This direct investment support results in cumulative interventions equalling almost €2012 200 billion for coal, €2012 100 billion for hydro, and €2012 220 billion for nuclear power plants. The contribution to the total level of interventions in 2012 is valued at €2012 15 billion at maximum (see Figure S – 1)4 . Another area of support for nuclear has been soft loans for nuclear plants. It is assumed that the effect of these loans is also captured by this method.

    Indirect historic support/Energy RD&D: Data from the IEA Research, Development and Demonstration (RD&D) Database shows historic expenditures made by 19 of the Member States on energy-related programmes. The reported cumulative RD&D expenditure by EU Member States in the period 1974–2007 was €2012 108 billion. For energy supply technologies this was €2012 87 billion (both including nuclear fusion).

    Historically the nuclear sector has received around 78% of the funding, of which the majority was on nuclear fission. The remaining RD&D expenditures were divided about equally over renewable energy (12%) and fossil fuels (10%). For energy efficiency the cumulative RD&D expenditures over the same period were almost €2012 10 billion, and €2012 11 billion was spent on a wider range of topics, including power conversion, transmission and distribution (€2012 4 billion), hydrogen and fuel cells (€2012 0.6 billion), and cross-cutting technologies/research (€2012 7 billion).

    Other historic support: In addition to the above, the most significant interventions in the market has been production support to the European coal industry and more recently, the renewable industry. The coal interventions were designed to ensure that domestic coal remained competitive with imported coal. We have therefore estimated the magnitude of the intervention by assuming that the difference between cost of production for domestic coal and the price of imported coal has been covered by a Government intervention. Using this assumption, there is a cumulative value of interventions for coal of €2012 380 billion in the period 1970 - 2007, the majority of which was in Germany. For renewable energy, we estimate the level of the historic support based on a funding gap approach. We estimate that for the period 1990-2007 cumulative interventions totalled to about €2012 70-150 billion. Using our methodology around 40% of that intervention went to biomass and one 25% to wind and hydro, and 10% to solar.

    External costs

    We assessed external costs by integrating information from life cycle assessments (LCAs), actual power production data and monetisation methodologies to estimate and value total environmental impacts. The methods for valuing external costs necessarily come with higher uncertainties than for interventions as by definition there is no market value. Nevertheless, there is value in calculating external costs to identify their order of magnitude, to place different externalities into perspective by using units that relate to the real economy, to allow for prudent comparison and to identify areas for priority in mitigating externalities.

    Total external costs are in the range of €2012 150-310 billion in 2012, with a central value of €2012 200 billion. The three biggest impacts are climate change, accounting for approximately half of the total, depletion of energy resources accounting for a further 22% and particulate matter formation, constituting 15% of the total. The remaining 13% of impacts include human toxicity, agricultural land occupation, water depletion, metal depletion, ecosystem toxicity, radiation, acidification and eutrophication. Among the power technologies, the fossil fuel technologies have the highest external costs, followed by nuclear and the renewable energy technologies (Figure S – 6).


    To quantify the true ‘cost’ of energy is an extremely complex problem as it depends on the age and type of plant operating in a particular country as well as infrastructure and market connections with other countries. To do this analysis for 28 Member States would need extensive modelling and very large datasets. In this study, we therefore provided levelised costs of producing electricity (LCOE) and heat (LCOH). Levelised costs are used for comparing technologies for a variety of different purposes. In this study, they are used to set the size of the interventions and external costs in context of a measure of the cost of energy if the system was being newly developed, without Government intervention. These estimates are based on hypothetical new energy conversion projects. These hypothetical plants do not determine either current market revenues or consumer prices. In addition, we provide estimates of the total capital and operating costs for infrastructure based on information from the Member States.

    Figure S – 7 presents levelised cost ranges per power generation technology. Levelised costs for electricity range from around 20 €2012/MWh for hydropower running a full load to 200 €2012/MWh for offshore wind and biomass plants running at realised loads5 . Hard coal and natural gas have similar levelised costs (50 €2012/MWh) if running at full load but in recent years the low price of coal and the increase in renewable electricity production has resulted in lower running hours for gas. Levelised costs at realised loads for gas are hence higher and comparable to onshore wind and nuclear. There have been significant reductions in capital costs for photovoltaics between 2008 and 2012, resulting in a fall in levelised costs from above 200 €2012/MWh to around 100 €2012/MWh.

    The levelised cost of heat ranges from 20 €2012/MWh for industrial gas boilers to 150 €2012/MWh for heat pumps and wood pellet boilers in certain climate regions. In general, the cost of natural-gas based technology is largely driven by the cost of fuel, while for technologies running on other fuels (heat pumps, biomass boilers), capital expenditures play a larger role.

    Electricity and heat technologies are part of the energy system. Transmission and distribution infrastructure is needed to deliver electricity and gas. Total annual expenditures (capital and operation & maintenance together) for the electricity transmission system across the EU28 are around €2012 20 billion. Total annual expenditures (capital and operation & maintenance) for the gas transmission network are of the order of €2012 15 billion in 2012. There were more data gaps in the reported expenditures for the gas transmission network.


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