A brighter tomorrow for renewable energy in EU

The European Parliament’s Committee on Industry, Research and Energy (ITRE) has defined its view on how the Renewable Energy Directive (RED II) should be revised to promote renewable energy after 2020.

– A clear feature is to truly promote renewables and defend market based and technology neutral solutions, says Anna Holmberg, Energy Policy Director at the Swedish Forest Industries Federation.

After the vote on November 28, Swedish media has mainly reported that ITRE decided on an increased ambition of 35 percent renewable energy within the EU by 2030, instead of the EU Commission’s proposal of at least 27%. Furthermore, media has reported that ITRE opened up for continued use of tall oil as feedstock for advanced biofuels. This is good news for the Swedish forest industry; however, the ITRE outcome also contains several other important and positive parts.

Concerning support schemes for renewable electricity, the committee decided  that Member States are free to choose how to design such schemes as long as they are market based, technology neutral, transparent, competitive, non-discriminatory and cost effective.

– We think it is positive that there is flexibility for Sweden to choose the model of support going forward, instead of being forced into a pre-defined format that could have made our existing green electricity certificate system obsolete. To us, the emphasis on support schemes being market based, technology neutral and cost effective is also very important, as these concepts are fundamental cornerstones for our industry, Anna Holmberg continues.

ITRE also defined that self-generated renewable electricity shall be exempted from any charge, fee or tax. Anna Holmberg believes that the committee is trying to facilitate for private individuals who want to install solar panels, but this will also be applicable to the Swedish forest industry, as it is a large producer of renewable energy on-site at its industrial premises.

– This could mean that the forest industry no longer would be required to pay energy tax for the renewable electricity produced and consumed at its mill sites. Since that production is as large as almost six terawatt hours each year, it takes pressure off and helps balancing the overall Swedish electricity supply system. We therefore think that a tax benefit is reasonable, says Anna Holmberg.

The committee supports increased use of renewable energy and waste heat in the heating sector, but also recognizes that the present situation varies a lot within the EU. Therefore, the committee is also on this item suggesting flexibility. Member States that are forerunners, such as Sweden, have the opportunity to define the future increase rate themselves, while Member States that are lagging behind are facing mandatory increase rates of one or two percent per year.

– The Swedish forest industry is big when it comes to renewable heat. We produce what we need ourselves, we sell biomass to others producing heat and we also sell waste heat. Since Sweden already today has a high share, a binding requirement to increase with at a certain percentage rate would have been unreasonable. Despite our strong position as an industry, we believe it is good that Sweden can choose its pace of increase since that will secure cost-effective solutions, says Anna Holmberg.

ITRE also decided on how to define advanced biofuels. This is a shared competence with the Parliaments Environment Committee (ENVI), which means both bodies have decision making power. ENVI declared already in October that it wants to radically restrict the number of feedstocks approved for production of sustainable, advanced biofuels.

– The Industry Committee definition is a positive and most welcome step forward. The definition respects the current list of approved feedstocks and also opens up for new innovations going forward, says Anna Holmberg.

The next step in the process for the RED II process will be the Plenary vote in Parliament. The date for this is not yet set, but it is expected to take place in January or February of 2018.