1. CEESA WP4: Market Development and Public Regulation
Senior Research Specialist Poul Erik Morthorst
Risø National Laboratory for Sustainable Energy
The Technical University of Denmark

2. 100% Renewable Scenarios
Biomass scenario. Based on 100% RES low demand, mostly biomass.
Wind scenario. Based on 100% RES low demand, mostly wind
High demand. Based on the 2004 energy demand, both wind and biomass.

4. EU Energy Policy Framework
Binding targets in EU:
i 2020
20% reduction of greenhouse gases by 2020 compared to 1990
this target can be raised to 30% subject to binding international climate change agreements
20% of final energy consumption in the EU has to be supplied by renewable energy
Existing target was 12% in 2010 and non-binding – 7% expects to be achieved
20% increase in energy efficiency by 2020 compared to a reference
10% biofuels in transport by 2020

5. How are the EU targets interacting?
20% Greenhouse gas reductions by 2020
CO2-quota
Emission Trading System
40%
Targets for sectors not covered by ETS
60%

6. How are the EU targets interacting?
20% Greenhouse gas reductions by 2020
ETS
Renewable Energy
Target
non-ETS

7. How are the EU targets interacting?
20% Greenhouse gas reductions by 2020
Target
for
energy savings
ETS
Vedvarende
energi
målsætning
non-ETS

8. How are the EU targets interacting?
20% Greenhouse gas reductions by 2020
Target
for biofuels
Target
for
energy savings
ETS
Renewable Energy Target
non-ETS

9. Greenhouse gases and Renewables in EU
European Emission Trading System (ETS)
Covers the power industry and energy intensive industries
Free allocation – Grandfathering
Auctioning after 2012 – same price all over EU
Reduction in allowances of 21% by 2020 compared to 2005
Non-ETS sectors
10% reduction within EU by 2020 compared to 2005
National targets ranging from -20% to +20%
Renewables
National targets – Denmark of 30% by 2020

10. National targets for renewables

11. A Patchwork of Support Systems for Renewables in EU
“Old” EU countries
“New” EU countries

12. Support for Biomass in different Member States

13. Harmonization of national support schemes for renewables
Current Policy Issues
Harmonization of national support schemes for renewables
The most economic efficient system, including cross border trade
Strong national interests in developing the renewable industry
Optimized national support schemes can achieve 70% of all economic benefits
National policies are needed for implementing targets

14. Denmark vs. EU in the Future

15. Conditions within the Future EU Policy Framework
The Emission Trading System will continue as the core of EU Energy Policy
Air and Sea transport will be included
New Targets for emissions and renewables will be set after 2020
The power market in EU will gradually be liberalized
One European market by 2020 coordinated by EU TSO
Increased competitiveness for renewables will gradually decrease the need for support
No need by 2030 assuming a CO2-price of 50 €/t and a crude oil price of 150 $/bbl

16. Wind power in Western Denmark

17. Wind power in Western Denmark
Wind Power covered approx. 44% of Power consumption in January in Western Denmark

18. Wind power in Western Denmark
Wind Power covered approx. 44% of Power consumption in January in Western Denmark
… and 36% on average in Denmark

19. Impact on Spot Price