1. European Climate Change Programme Renewable Energy, Progress and way forward by Oliver Schäfer, European Renewable Energy Council - EREC Brussels, Monday, 24 th October 2005

4. Renewables Are the Key Solution to Climate Change

5. Why energy efficiency in combination with renewables development has to be the number 1 priority -Climate change -Oil price/dependency -Air pollution -Nuclear risk -Electricity/gas prices -Competitiveness of EU businesses -Job creation potential

6. 100 Millions of citizens from China, India, Brazil, Mexico,… are imitating those in the US, EU, Japan on consumption patterns we have little time, because

7. Source: Malte Meinshausen, Swiss Technical University Implications of delays in reductions of CO2

8. …and Harry Potter can not help 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055

9. The Reality Today Market Development in Wind and PV

10. Cumulative Wind Energy Installed Capacity Source: EWEA Growth rates 1994-1999 : 31.2% 1999-2004 : 28.3%

11. The Top-10 Markets in the World Source: EWEA

12. The Top 10 Suppliers in the World Source: BTM Consult

13. Cumulative Photovoltaic Installed Capacity (MWp) Source: Eurec Agency, EPIA, Observ‘ER Growth rates 1994-1999 : 18.0% 1999-2004 : 30.5%

14. The Top PV Markets in the World Source: EPIA, Observ‘ER, IEA-PVPS

15. Top PV producing countries in the world Source: EPIA, Observ‘ER, IEA-PVPS

16. The Top PV Manufactures in the World Source: EPIA, Observ‘ER, IEA-PVPS

17. Policy Works!

18. RES target for Europe RES target for Europe 20 % by 2020

19. The European Parliament key recommendations - a 20% binding target for renewable energies in total energy consumption by 2020 (equivalent to 33% electricity in 2020, up from a level of 12.9% in 2002 4); - tax cuts to encourage renewables; - fair market conditions for electricity produced from renewable energies; - end to distortions in the energy market (ownership unbundling, market concentration, environmental harmful subsidies to fossil fuels and nuclear energy); -a clear increase of R&D budget for renewables in the upcoming FP7 to compensate the historical bias in EU energy research programmes;

20. 20 % by 2020 A contribution of RES to total inland consumption of 20 % by 2020 is possible The contribution of RES to electricity production will be more than 33 % in 2020 The contribution of RES to heat production will be 25 % in 2020.

21. AGR needed to meet the White Paper Targets

22. Benefits of 20 % target  Total RES investment of 443 billion € in the period 2001-2020  126,7 – 323,9 billion € of cumulated avoided external costs between 2001 and 2020  115,8 billion € of cumulative avoided fuel cost reduction in EU 15 (2001-2020)  Creation of more than 2 million full time jobs until 2020  728 million tons/year of CO 2 emission reduction in 2020, representing a decrease of 17,3 % compared to 1990

23. Annual CO 2 Emission Reductions due to RES Penetration due to RES Penetration (2001 – 2020) 2010 Mt/year 2020 Mt/year Wind99236 PV2.224 Biomass176326 Hydro2335 Geothermal5.815 Solar thermal1492 TOTAL RES320728 % of total EU15 CO2 emissions in 20009.6%21.9%

24. Conclusion RE has the technological potential to replace fossil fuels as mainstream energy source. RE is integral part of the energy supply in many countries today. RE has tangible economic, ecological and social benefit. BUT: RE market development depends on a coherent, predictable, supportive political & legal framework.

25. Think the `Unthinkable` The EREC `Advanced Policies Scenario` (APS)

26. Why Scenarios? images of alternative futures neither predictions nor forecasts image of how the future could unfold useful tools for investigating alternative future developments and their implications Scenarios can create a vision for the future and guide decision makers

27. `Scenarios help us understand the limitations of our ‘mental maps’ of the world – to think the unthinkable, anticipate the unknowable and utilise both to make better strategic decisions.` The IEA AS is a welcomed move, but it has too many limitations – it does not think the `unthinkable`: A Substantial Policy Shift

28. Assumptions Based On: Ambitious growth rates Additional support measures Regions already active in the promotion of renewables will increase their efforts Higher prices for conventional energy supply Growing support for electrification of the poor regions by renewables. Implementation of the Kyoto protocol and additional measures International cooperation Total energy consumption are based on a scenario from the IIASA

29. The Contribution of Renewable Energy Sources to the World Energy Supply in 2040 – Projections in Mtoe – APS

30. Electricity Scenario

31. Exemplary detailed scenario for electricity – APS

32. Comparison between IEA-AP and EREC Scenarios (2030) IEA-ASEREC-DCPEREC-AP RES Total (Mtoe)234534164289 RES- E (TWh)68361177017109 WIND (TWh)~100045906307 PV (TWh)~10012802570

33. diesel: 21 -23% hydrogen from gas reforming: 30% Hydrogen from electrolyses: 12 -15% Hybrid: 30 - 35% Efficiency of different engine solutions What is not the Solution - Hydrogen

34. Overall efficiency of nuclear hydrogen 12% –33% of efficiency to produce electricity from NP –5 kWh to produce 1m3 H2 (electroloyses) –1m3 H2 produces 1.8 kWh el To fuel 40% of world transport demand in 2060 would require at least 4000 NPP of 1000 MW ! nuclear hydrogen for cars/lorries

35. A Streamlined Internal Electricity Market

36. Competition in the internal electricity market ? “Much work still has to be done to deal with the dominant and even monopolistic positions of the incumbent operators and investments will be needed to guarantee the interoperability of grids and networks, interconnection and an adequate level of capabilities and infrastructure” Loyola de Palacio, 13 October 2004 “The current level of competition is not encouraging. (…) In most national markets, customer switching rates are modest, substantial barriers remain for new entrants, market structures are highly concentrated and, last but not least a single European energy market has not been achieved.” Mario Monti, 21 September 2004

37. Distortions in the internal electricity market 4 Commission benchmarking reports: Endless distortions National and regional monopolies / oligopolies No real consumer choice Lack of interconnectors Little separation of production and transmission Power companies acting on both demand and supply side in the wholesale market 75% of electricity subsidies goes to conventional power Euratom shields nuclear (33% of total EU production) from internal market rules (since 1958!) Complete absence of any meaningful internalisation of environmental costs

38. Liberalised Markets? 95% of the EU power market is still affected by huge market distortions Electricity prices do not reflect full costs as long as polluter pays principle is missing Subsidies -direct and indirect- to conventional power production is still massive National and regional monopolies / oligopolies Competition not effective

39. Ownership-Market Concentration

40. For more information www.erec-renewables.org EREC - European Renewable Energy Council Renewable Energy House 26, rue du Trône - B-1000 Brussels T: +32 2 546 1933 - F: +32 2 546 1934 erec@erec-renewables.org