Green electricity growth stalling in Europe

Growth of renewable electricity in Europe in the next five years could be almost 30 percent higher if market and policy conditions improve, the International Energy Agency (IEA) said Friday (2 October) in a report.

The IEA expects power generation from renewable sources - like wind, solar, and bioenergy - to increase by almost 25 percent between 2014 and 2020, it said in its annual Medium-Term Renewable Energy Market Report.

But the agency added that “policy uncertainty” in countries like Poland and the UK over the future of incentives for onshore wind there have stalled growth.

The report looked at those European countries that are members of the Organisation for Economic Co-operation and Development (OECD) - the Paris-based International Energy Agency was established in 1974 in the framework of that organisation.

The OECD Europe countries added 21 gigawatt (GW) of renewable capacity in 2014, down from over 24 GW in 2013 and the lowest since 2009.

“Weak electricity demand growth and decreasing economic incentive levels characterise the slower renewables forecast for OECD Europe”, the report said.

“Capacity additions in OECD Europe are expected to dip in 2016, largely due to near-term changes in incentives in the United Kingdom, then to increase modestly thereafter with increased offshore wind installations picking up as cost reductions are seen stronger after 2017”, it added.

On an EU level, the report noted that increasing the level of interconnection “is probably the most significant step that could improve the value of renewable generation and facilitate development of a more effective pan-European renewable system”.

China

When looking at the global picture, the IEA expects the world's total share of renewable power to rise from 22 percent in 2013 to 26 percent in 2020.

China accounted for 40 percent of all new renewable capacity last year, adding three times the total power capacity of the UK.

“China’s generation needs, pollution concerns and a favourable policy environment with ambitious targets drive the forecast”, the IEA said. In absolute terms China is the largest market, followed by the EU.

Dropping costs

Part of the reason for the growth is that costs are continuing to decrease.

Over the past five years, onshore wind generation costs have fallen by an average of 30 percent. The price for solar power photo-voltaics (PV) dropped by two-thirds.

“High levels of incentives are no longer necessary for solar PV and onshore wind, but their economic attractiveness still strongly depends on the regulatory framework and market design. Meanwhile, some technologies (offshore wind, solar thermal electricity and some bioenergy) require continued policy support to bring them down the learning curve.”

OECD Europe countries are: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway, Poland, Portugal, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Turkey and the United Kingdom.

In 2014, renewable power generation in OECD Europe increased by around 2 percent, to reach 1,120 terawatt-hour (Twh). The growth figure for the European Union was over 3 percent, reaching 916 TWh.