European Commission adopts new renewable energy funding guidelines

By Staff | June 05, 2014

The European Commission has adopted new rules on public support for environmental protection and energy projects. According to the commission, the guidelines promote a gradual move to market-based support for renewable energy.

The guidelines also call for a gradual introduction of a competitive bidding process for allocating public support to renewable energy projects. Feed-in tariffs would also be gradually replaced with feed-in premiums, which are expected to expose renewable technologies to market signals. Certain exemptions would be available for small systems and in circumstances where member states demonstrate the bidding process would lead to an unsatisfactory outcome.

Nina Skorupska, chief executive of the U.K.-based Renewable Energy Association, called the commission’s guidelines a “huge leap into the unknown.” He added, “These new guidelines are based on economic modelling, which suggests that competitive mechanisms will deliver equally good results at lower cost to the consumer. We support measures to reduce policy costs as renewables continue their journey towards price parity with fossil fuels. But putting so much faith in untested theory is a big risk, especially when the U.K. is in such desperate need of new capacity.”