News Article
Cost-effective Financing Of Photovoltaics
European Commission proposes non-optimum solutions
The European Commission has released a communication titled “Renewable Energy: Progressing to 2020”, in which it suggests ways to ensure a more cost-effective financing of renewables. The European Photovoltaic Industry Association (EPIA) welcomes the efforts of the European Commission in this field but is concerned about some propositions that could prove to be counter-productive and underlines the importance of maintaining and fine-tuning existing successful national support schemes and addressing bureaucratic barriers.
In its communication, the European Commission is analyzing a wide range of tools used to support renewable energy technologies in the EU with the aim of ensuring that money is spent cost-effectively.
EPIA fully supports this general objective, in particular the importance to adapt instruments in order to avoid excessive returns on capital. “PV investment profitability should be assessed on a regular basis and support schemes adapted accordingly in a predictable manner” said Eleni Despotou, Ad-Interim Secretary General of EPIA. “Well-designed and evolutionary support schemes are the key market drivers for a sustainable photovoltaic (PV) deployment. We think that Feed-in-Tariffs should evolve within a predefined “corridor” that could help avoiding stop-and-go policies or retroactive measures” she added.
As correctly pointed out in the EC communication, the bulk of the support for renewable energy is delivered today by the Member States. “It is therefore important to act where adaptations can really make the difference, i.e. at the national level” Mrs. Despotou said. Referring to the Commission's assessment that the evolution to feed in premiums should be reinforced, she however added that “it is still to be demonstrated that such a shift would be more efficient for the development of renewables and photovoltaics in particular”.
While recognizing the need to adjust supporting tools on a country specific basis, EPIA considers that some of the evolutions proposed in the communication at the European level could prove to be counter-productive.
Referring to the European Commission's call to achieve a greater convergence of national support schemes to facilitate trade, Mrs. Despotou affirmed that such an approach “could deprive Member States from a real control on their binding national target and could eventually cost more to the European citizens.” EPIA considers that the Renewable Directive is already providing the appropriate framework, in order to develop renewables at the best cost-effective way while taking into account the maturity of the different technologies.
Finally, “when it comes to financing, we should not forget that huge savings can also be achieved by tackling bureaucratic barriers” reminded Mrs. Despotou. European PV Legal project has shown that in certain countries, compliance with administrative and grid connection procedures can represent up to half of the development cost of a project.