Comparative Study on the Main Renewable Energy Support Mechanisms in European Jurisdictions - 2010

Date: 05/03/2010

Robert Lane CBE

The EU Directive 2001/77/EC has proven to be a milestone in the promotion of renewable energy in Europe. It has triggered the development of renewable energy to varying degrees in the EU Member States. In some countries whole new industries have emerged within the last few years.

A new milestone has been reached with the new EU Directive 2009/28/EC on the promotion of the use of energy from renewable sources. This Directive amends and replaces Directive 2001/77/EC by expanding its scope of application. It is envisaged that by the year 2020, 20% of Europe's energy will be gained from renewable sources. In order to reach this target, every Member State will have to fulfil an individual threshold.

In addition, the new Directive obliges every Member State to enhance its energy-efficiency by 20% and sets a target of 10% for energy from renewable sources in the field of public and private transport.

This Comparative Study highlights the national strategies in place or envisaged to fulfil these obligations, thereby highlighting the different ways in which renewable energy sources can be fostered.

Renewable technologies require subsidies in order to compete with the existing technologies and one can differentiate between three types of schemes which incentivise the development and use of renewable energy sources; a system of feed-in-tariffs, a system of “greenbonuses” and a system of green certificates. Every Member State has implemented its strategy in different ways; for instance, some have made distinctions regarding the duration of guaranteed payments (up to 20 years) or by the amount of subsidies.

It is interesting to observe, in respect of the financial promotion of single technologies, that guaranteed payments have become more or less harmonised in the different jurisdictions without regulative interference from the EU. This leads to the conclusion that a fair subsidy, miminishing over time, exists.

This Study also includes the mechanisms pursued by some non-EU Member States in order to highlight their increasing efforts to promote renewable energy

Our expertise

More information to our practise area you will find here.