CLEAN
ENERGY PACKAGE

EUROPE’S NEW FRAMEWORK FOR SOLAR

In November 2016, the European Commission presented the Clean Energy Package, a set of legislative proposals, with the goal of providing a framework for the EU energy sector to accelerate the clean energy transition in Europe.  The Clean Energy Package is intended to maximise EU leadership in the energy transition, by placing the consumers at the heart of EU’s energy strategy.

The Clean Energy Package is a key piece of legislation for the solar sector, with huge ramifications for our technology’s growth in the coming few years.

1. Renewable Energy Directive

The Renewable Energy Directive is an essential piece of the Clean Energy Package, to deliver the EU’s ambition of being the leader in renewable energy globally.

The Renewable Energy Directive addresses key issues for solar businesses in Europe, such as setting the level of ambition of the European Union in developing renewables up to 2030; the regulatory framework related to support and tendering schemes for solar installations, the treatment of solar prosumers and communities; and the removal of administrative barriers to unlock the development of all solar projects across Europe. The final adoption of the Renewable Energy Directive by the Parliament and Council is planned for November 2018.

What we have achieved and what it will do for solar by 2030:

  • An ambitious target for renewables in Europe: at least a 32% of Europe’s gross final energy consumption in 2030 should be covered by RES, including an upward revision clause by 2023
  • New era for renewable self-consumers by allowing new business models to thrive such as collective self-consumption, aggregation or third party ownership
  • Exemption from charges/fees for self-consumed electricity up to 30kW with cost-reflective charges and market value remuneration for electricity fed into the grid
  • Simpler administrative procedures to enable the growth of small-scale RES plants with the introduction of a one stop shop
  • Shorter permitting deadlines up to one-year for installations below 150kW and simple notification for small solar projects equal or less than 10.8kW (Member States to allow it up to 50 kW)
  • Obligation for Member States to report progress on Corporate Sourcing and to remove administrative barriers
  • Mandatory issuance of GOs, strengthening the role of Guarantees of Origin (GOs) in tracking renewable electricity
  • Technology specific tenders and FiT for small scale, with the possibility of exempting small scale installations and demonstration projects from tendering procedures
  • No retro-active changes for support schemes except under very limited provisions, provided that the economic viability of the projects isn’t undermined
  • Ambitious National energy and climate plans that include long-term planning for support to Solar

2. Electricity Market Design

The Electricity Market Design Regulation and Directive is the “hardware” of the European energy transition. It is the cornerstone to develop forward-looking European electricity markets, adapting to the increasing contribution of renewables, and integrating new sources of flexibility (renewables, storage, demand-response) closer to the real-time.

At the same time, future electricity markets should ensure that all renewable capacities will be able to compete on a level playing-field with conventional energy sources, recognising the specificity and benefits of small scale, clean, and locally owned installations.

The Electricity Market Design legislation is a powerful tool to bring the energy transition to the next level, by restricting the use of public subsidies to polluting and inflexible generation capacities.

Our position:

  • Develop more open, transparent, and liquid electricity markets, fit for solar
  • Ensure a step-wise integration of solar installations into the market, by maintaining priority dispatch and balancing responsibilities exemptions for small-scale solar
  • Restrict the use of capacity mechanisms in Europe: their implementation should be a last resort and thoroughly justified by a European Adequacy assessment. The most emitting power plants should not be eligible to benefit from public subsidies through these mechanisms.
  • Promote a smarter use of our electricity networks, optimising the integration of solar solutions into the system: the curtailment of renewable energy should be a last-resort measure, and fully compensated
  • Put in place the right market conditions for the uptake of active customers and solar and storage services

3. Governance

The 2030 European Climate and Energy Framework introduced European binding targets for 2030, a new feature that will replace the national renewable binding targets developed under the previous 2020 Energy and Climate Framework.

How can we create a European binding framework, without developing national binding targets? This is the challenge of the Governance Regulation, which will define the main outlines of the 2030 National Energy and Climate Plans, to be submitted by EU Member States by the end of 2018.

Our position:

  • A minimum EU binding renewable energy target of 35% by 2030
  • Reliable and transparent National Energy and Climate plans, providing visibility for the energy sector
  • Strong milestones to measure Member State’s progress towards the achievement of their 2030 renewables target
  • The establishment of a robust Gap Filler mechanism to trigger additional action in case a gap arises compared to the EU trajectory towards the renewable energy target by 2030.
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4. Energy Performance in Buildings

The revision of the Energy Performance in Buildings Directive represents a huge opportunity to transform the future building stock into a cleaner and more active component of the energy system. This is even more relevant considering that buildings are, today, one of the biggest CO2 emitting sectors in Europe.

On-site solar installations and building integrated solar are an opportunity for increasing energy performance in buildings. Solar enhanceconsumer empowerment while fostering a cost-efficient transition towards a more decentralised, digitalised, and cleaner building stock. The Energy Performance of Building Directive is a key to improve the smartness of our future buildings stock and their ability to interact with other sectors generating added value for European society at large (smarter and cleaner transport, demand-response, collective self-consumption).

The new Energy Performance of building Directive has been formally adopted by the European Council on the 14th of May 2018.

What we have achieved and what it will do for solar by 2030:

  • An ambitious EU strategy for the renovation and full decarbonation of EU’s building stock by 2050
  • Member States will elaborate a detailed strategy for the renovation of their building stock (residential, non-residential, private, public) by 2050, integrating the contribution of solar for the decarbonation of the building stock
  • A forward-looking strategy for the uptake of smart buildings in Europe, acknowledging the positive contribution of on-site solar and BIPV:
  • The European Commission will develop by the end of 2019 a “Smart Readiness Indicator” for buildings which will support the EU’s monitoring for the uptake of smart buildings in Europe
  • On-site generation is integrated in the key functionalities of the Smart Readiness Indicator
  • The use of this indicator will first be optional for Member States
  • Forward looking energy efficiency provisions facilitating the buildings’ integration into a wider energy ‘eco-system’ (i.e. on-site renewable generation, smart metering, demand-side flexibility and electro-mobility, storage)
  • The methodology for the calculation of the energy performance of buildings will integrate the contribution of innovative technologies such as BIPV
  • The positive influence of active solar systems will be factored in the overall energy performance of buildings calculation carried out by Member States

However other important provisions for solar in buildings are still under negotiation:

The proposal for a revised energy efficiency directive includes the ability for countries to incentivise the development of self-consumption in buildings in the calculation of their annual energy savings obligations achievements.

The proposal for a revised renewable energy directive could extend the obligation for Member States to require the use of minimum levels of energy from renewable sources in new and renovated buildings. It will also set crucial requirements to foster the uptake of renewable self-consumption in Europe.

Finally, the proposal on the Governance of the Energy Union sets reporting obligations for Member States on the share of renewables in buildings energy consumption progresses.

5. Energy Efficiency

Energy efficiency policy is a key lever for the renovation and modernisation of the European building stock, which is responsible for 36% of CO2 emissions in Europe. The reduction of energy demand in key sectors of the economy is a priority and should be implemented consistently with the need to decarbonise the European building sector.

The implementation of energy efficiency actions in buildings is therefore a major opportunity for a cost-optimal deployment of on-site renewable generation in buildings.

The main challenge to achieve this is to build consistent energy-efficiency policies, breaking the silos between the reduction of energy demand – through performance improvements of the EU’s building stock – and the development of on-site solar and Building Integrated PV generation.

Our position:

  • We must promote forward looking energy efficiency policies, to grasp the benefits of on-site generation combined with the flexibility of smarter buildings
  • In determining annual energy savings as provided in article 7 and annexV, Member States should be incentivised to undertake ambitious policies dedicated to on-site generation and use of renewables in buildings
  • The EU should promote the uptake of green electricity and decarbonise key sectors of the economy by setting a 2.0 Primary Energy Factor for electricity (Annex IV)

"Households can wake up in the morning with the knowledge that they will have a new right - the right to selfgenerate, consume and store the energy they produce. This is a major achievement."

James Watson, CEO of SolarPower Europe

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