Businesses have warned of a ost decade' for renewable energy in the EU unless proposed energy legislation is strengthened and made more consistent across member states.
The European Commission is due to publish proposals tomorrow to boost renewables and energy efficiency in the EU. They will cover electricity, market rules and targets, and requirements for planning and reporting on progress.
The so-called energy union package will replace the existing Renewable Energy Directive (RED), which mandates each member state to meet individual targets for renewable energy and energy efficiency by 2020. Draft replacement legislation proposes replacing national targets with an EU-wide one.
Businesses polled by the Corporate Leaders Group (CLG), including BT Group, GSK, LafargeHolcim, Philips Lighting, as well as trade bodies Business Europe and Cefic, said this would have serious implications for investment in renewable energy.
Firms were ‘wholly frustrated’ by the lack of action from the EU, the CLG found. Companies complained about lack of consistency on policies and timespans, poor enforcement, low ambition on targets, little co-operation at national or regional level and the absence of a coherent framework to plan for the future.
The CLG report states: ‘If member states no longer have individual targets, it will without doubt be read as the EU giving tacit permission for countries to treat renewable energy as a less serious policy priority.
‘That has a serious effect on investment – if member states won’t commit themselves to binding targets, how should they expect investors to commit to funding that will reach those targets?’
Jill Duggan, director of the CLG, said: ‘Companies from a variety of sectors are calling on the commission for higher ambition on renewable energy, delivered through a robust framework with strong, visible ownership of the process by member states.
Many businesses felt that the move from member state to an EU-only target was ‘a big backwards step,’ she said. ‘Without strong, determined coherent leadership on renewables policy by the European Commission, we risk a lost decade for renewables in Europe setting back our long term plans,’ she added.
Businesses contacted by the CLG also backed standard market design, templates for regional co-operation and enforcement measures.
These firms have the capacity to easily absorb the level of ambition for renewable energy, and see the potential for doing significantly more if the EU was to rationalise the current chaotic landscape of conflicting policy and watered-down ambition, the CLG concluded.
Last week, a group of businesses committed to use 100% renewable energy in their operations called for better harmonisation of energy markets across the EU. The RE100 want a common rule-book to remove the need for corporations with premises across Europe to understand multiple different regulations relating to the procurement of renewable generation.
Negotiations on a directive to replace the RED are expected to last until late 2018 or early 2019, so it is unlikely the plans would become law before the UK exits the EU.
The applicability of the energy package in the UK depends on its future relationship with the bloc, but leaked drafts contain provisions for countries outside the European Economic Area and the single market to participate in the internal energy market with the same rights and requirements as EU members, according to leaked documents seen by think tank E3G.
Conditions attached to this include agreeing to environmental standards and state aid controls, and judicial oversight by an independent authority, such as the European Court of Justice, it said.
Click here to read more about the leaked documents.
