Wind and solar power generation in the EU rose by 400% and 8,000% respectively between 2005 and 2017.
The Commission should urge Member States to support further deployment – by organising auctions to allocate additional renewables capacity, promoting citizen participation and improving conditions for deployment. At the same time, the auditors warn that half of the Member States will face a significant challenge in trying to meet their 2020 renewables targets.
The EU aims to generate a fifth of its energy from renewables for electricity, heating and cooling and transport use by the end of 2020. Indeed, between 2005 and 2017, the generation of electricity from renewables in the EU doubled from around 15 percent to almost 31 percent. The wind and solar photovoltaic power sectors currently make up the largest share of renewable electricity, and falling costs make them an increasingly competitive alternative to burning fossil fuels.
The auditors assessed the progress made by the EU and Member States towards the renewables targets. They went to Germany, Greece, Spain and Poland to examine whether financial support for electricity generation from wind and solar power had been effective.
The auditors found that initial support schemes had been over-subsidised in a number of cases, resulting in higher electricity prices or increased state deficits. After 2014, when Member States eventually reduced support to lighten the burden on consumers and national budgets, investor confidence was dampened and the market slowed down.
"Member States incentivised investment in wind and solar power, but the way they reduced support deterred potential investors and slowed deployment," said George Pufan, the Member of the European Court of Auditors responsible for the report. "The slowdown in shifting towards renewable electricity implies that we might not meet the EU 2020 target."
Organising auctions to allocate additional renewables capacity, to determine the bidding price and promote citizens' participation in the green economy, is crucial for increasing investment, say the auditors. Also, additional improvements are required to improve conditions for participation in the renewables market, including overcoming restrictive spatial planning rules, lengthy administrative procedures and grid insufficiencies.
The auditors also found that half of the Member States were already closing in on their national 2020 renewables targets by 2017, but warn that the remaining half will require much further effort if 2020 targets are to be met. The auditors express concerns as to whether the efforts of the high-achievers in renewables will be enough to compensate for the renewables' under-achievers in order to meet the overall EU target.
The current rules do not ensure timely reporting on progress on renewables, and the Commission does not have a mandate to address slower deployment by the Member States, say the auditors. They point to the EU's 2030 renewables target of at least 32 percent and say that, in the absence of binding national targets, this may be hard to achieve. They also warn that meeting this target will require a significant amount of public and private national funding in addition to the EU funding the report focuses on.
The ECA makes the following recommendations:
- focus on closing gaps to meet the 2020 targets;
- simplify procedures and improve timeliness of statistics;
- plan sufficient auctions and promote investment in grid infrastructure;
- ensure better monitoring.
Between 2007 and 2020, the EU provided around €8.8 billion to renewable energy projects through the European Regional Development Fund and the Cohesion Fund, including around €972 million for wind and €2.9 billion for solar investments. Support schemes generally offered guaranteed selling prices, top-up premiums or additional income through tradable certificates. For 2021-2027, the Commission proposes around €71.8 billion for operations supporting climate objectives, including the promotion of renewable electricity.