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Global Futures Report 2013 - Europe

45 Great Debate 9 | How Will Feed-in Tariffs Evolve? Given lower technology costs, higher support costs to consumers as markets expand, and higher renewable power shares on grids, some European experts questioned how long Europe’s policy support mechanisms would be needed, or how long governments would maintain them. Some saw the evolution of many support mechanisms during 2020–2030 to meet changed market conditions and power grid integration needs. And many saw continued policies through 2030 and beyond, particularly if a new target for 2030 is adopted, such as the 45% share proposed by EREC (2011). At least one scenario, Eurelectric (2009) “Power Choice,” projects a phase-out of support mechanisms by 2030. Some experts believed that net metering policies were on the rise, and that as solar PV reaches and goes beyond grid parity (see solar PV in Chapter 6), solar PV feed-in tariffs would evolve over time into net metering policies. (See footnote on page 26 for definition of net metering.) Notes and discussion: See Annex 4. This chapter provides brief national-level market projections and policy discussions for Europe, the United States, Japan, China, and India.a The chapter then covers more generally a range of market and policy points for developing countries considered together, including some specific national policy targets, plans, and market projections in a number of developing countries, as well as some regional projec- tions for Africa, Asia, Latin America, and the Middle East.1 In interviews with national experts, many emphasized the strong linkage between market growth and future policies in these coun- tries.2 (See “Great Debate 2” on page 13 for a fuller discussion of these linkages.) In a short space, it is impossible to provide the full range of market projections and policy discussions for all countries and regions. The reader is referred to the online supplement “Topical Discussion Report,” which contains fuller country-specific information, includ- ing expert-contributed milestones and more “Great Debates.”3 Europe Europe’s target for a 20% share of total final energy from renew- ables by 2020, adopted in 2008, coupled with feed-in-tariffs and many other strong support policies that date back a decade or more in many EU countries, have been instrumental in making Europe a global leader in renewable energy.b Many European experts believed that Europe would continue this leadership, although perhaps at a reduced pace given economic difficulties and the clear ascendancy of China in wind power since 2009, and solar PV more recently. European renewable energy advocates are pushing for a further target for 2030, such as the 45% target proposed by EREC (2011). Many experts believed that such a target was feasible and integral to Europe’s continuing policy and market leadership in the 2020s.4 Industry experts were quite optimistic about wind power in Europe, both onshore and offshore, an optimism that is reflected in current scenario projections and also national targets. National policy targets for wind power by 2020 include Denmark (50% of its electricity); France (19 GW onshore and 6 GW offshore), Italy (12 GW onshore and 0.7 GW offshore) and Spain (35 GW onshore and 0.8 GW offshore). By 2030, two high-renewables scenarios show 400–500 GW of wind power in Europe (EWEA, 2011, “Pure Power,” and GWEC, 2012, “Advanced”). By 2050, EWEA believes that wind power could supply half of Europe’s electricity.5 European solar industry experts expressed optimistic visions for the adoption of solar PV throughout Europe as well. One expert pro- jected that solar PV in Europe would reach 130–400 GW by 2020, reflecting three cases from “baseline” to “accelerated” to “para- digm shift." (For comparison, Europe had 51 GW in 2011.) Germany alone targets 52 GW by 2020, the expert noted, and believed that Germany would perhaps reach 60–70 GW. Beyond 2020, Europe- wide growth might level off somewhat, some experts thought. EREC (2010) projects 400 GW by 2030 and 1,000 GW by 2050 for Europe.6 Experts were optimistic about biomass for heating and combined heat and power (CHP) plants, especially in northern European coun- tries. Biomass-based district heating systems, individual biomass (pellet) stoves, and biofuels for transport were all cited as high- growth markets in the future.7 European policymakers and industry experts highlighted several key areas of future policy in Europe that could influence future markets. These include: an EU-wide target for 2030, EU-wide grid infrastruc- ture planning and strategy, a coming EU directive on the energy performance of buildings, the time frames for continuing and then phasing out policy support mechanisms like feed-in tariffs (many saw phase-outs starting in 2020–2030), the future of carbon policy and the Emissions Trading System, standardization (“harmoniza- tion”) of electric utility rules and regulation, support for centralized versus decentralized investments, and local standards and codes for renewable heating. Many of these issues are the subject of current debates or were expected to become central debates in the coming years.8 05 a) Throughout this chapter, market growth is reflected mainly in gigawatts (GW) of renewable power capacity. To put these GW figures in some context, refer to Table 4 on page 53, and also see the online supplement “Glossary and Basic Energy Concepts.” Markets are typically measured in annual GW capacity added or the growth of total GW capacity existing, the former typically denoted by “annual market” and the later by “capacity” or simply a GW or percentage growth figure. Another common metric is growth of the annual market, meaning year-on-year increase in annual capacity added. These three distinct metrics can confuse unaware readers. Furthermore, capacity in GW is only partially indicative of total power generated (actual benefit received), as the same capacity of different types of renewables (or of any energy technology) in different conditions will provide widely different amounts of actual power generation. b) The Europe 2020 target includes a 10% target for transport. National action plans could collectively reach a 21% share for heating. See Chapter 1 for discussion of country-specific targets for EU member countries. EC JRC (2011) expected Europe to slightly exceed these shares by 2020.

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