1st Plenary Meeting, 17th-18th November 2021, Online
Session 2: Governance - integrated planning and reporting and the mechanisms for EU RES target achievement
The session took stock of the status quo of the RES target achievement mechanisms of the Governance
Regulation including the different instruments. The participants discussed the extent to which the existing set
of rules is adequate for the increased ambition levels and which elements may deserve further attention.
The European Commission presented the obligations contained in the Governance regulation (EU)
2018/1999 for Member States to develop integrated planning and progress reporting and also defines
the mechanisms by which various Energy Union targets will be achieved, including the RES target as
part of the decarbonization dimension.
Key element of these mechanisms are the National Energy and Climate Plans (NECPs), where MS set
out their objectives along the five dimensions of the Energy Union, including planned contributions to
the EU RES target of (currently) at least 32% by 2030 as well as the measures to achieve these
With a view to a possible review of the Governance regulation, the Commission highlighted the
following areas that might require an update:
- RES-Target: moving from at least 32% to at least 40% in 2030,
- Amendments of Article 2 and 4 (changes via Article 2 of the Commission proposal for amendment of RED II, COM/2021/557),
- Reporting obligations,
- New obligations/ extension of existing obligations introduced in many acts of the EGD legislative package,
- Links to Article 9 (7a) of the Commission proposal for amendment of RED II: Joint projects between MS, cooperation to define the amount of offshore RES 2030/2040/2050 to be notified with the NECP update,
- The gap-filling mechanism in particular with a view of measures to fill the delivery gap.
The review is currently foreseen in 2024 but might be advanced in light of the European Green Deal package. The Commission further clarified that it may issue guidance on the upcoming updates of the NECPs due in 2023 and 2024 in line with the legislative proposals made. Such guidance would be welcomed by Members States.
In the discussions, as a key challenge for the EU 2030 RES target achievement approach the potential time lag was identified, which occurs between the initial planning and the final point in time of closing potential gaps, given the time lag of approximately 2 years until official data becomes available, in addition to the combined lead times to design and implement RES policies and to develop and realise RES projects.
Furthermore, Luxemburg presented on its national approach to ensure 2020 RES target achievement including by means of cooperation projects with other EU Member States involving statistical transfers, and also explained the structure and overall strategy of its current NECP with a particular focus on renewable energy.
Session 8: Regional Cooperation
Policy instruments as tools for keeping the 2020 targets as baseline and achieving the trajectory to 2030 (e.g. new Union Renewable Development Platform and the RES Financing Mechanism) and Offshore RES cooperation (esp. regional 2050-targets, EC guidance)
The session focused on the importance of regional cooperation for achieving the increasing 2030 targets and the EU instruments available for this purpose. It showed that a lot is currently happening between Member States, but also on the Commission side.
This session provided an overview of existing EU policy instruments through a presentation by the European Commission and included an expert presentation by Guidehouse on the different types of cooperation offered by the Renewable Energy Directive (RED) to see how they fit with EU policy instruments. Furthermore, Estonia and Denmark provided broad insights into their practical experiences with cross-border cooperation.
The European Commission explained the different EU policy instruments (in particular the Union Renewables Development Platform (URDP), the EU Renewable Energy Financing Mechanism (REFM) and the Connecting Europe Facility- Cross-border Renewable Energy Projects (CEF-RES). The URP facilitates the conclusion of statistical transfers between Member States. The platform provides information on available volumes of statistics, has a matchmaking mechanism and offers guidance. However, this is only available to MS-designated users. The REFM is a tool to implement competitive EU-wide tenders in support of new renewable energy projects. The CEF-RES – an instrument to support RE projects that are launched through a cooperation agreement and have a net socio-economic benefit – includes grants for preparatory studies, for technical studies, and for works. The discussion revealed that these grants can be combined. Therefore, several grants can be awarded for the same project.
The European Commission also presented what is to come in 2022, this includes esp.:
- CEF-RES: The deadline for the call for proposals for preparatory studies has been extended. The new deadline is 1.02.2022; The call for applications to the list of cross-border projects will come in Q1 2022, and the call for proposals for technical studies and works in Q4 2022.
- REFM: Yearly call on Member States to express interest in Q4 2021; expression of interest by Member States to participate in a call, either as host or contributing country (Q1 2022); and based on the MS interest, EC designs the main elements of the call, CINEA will implement the call for proposals (Q3 2022)
Guidehouse gave a presentation on “Renewables cooperation in practice: How to implement a cross-border project until 2025?”. The expert presented the main approaches to cross-border cooperation. He showed that the goal of cooperation can be related to the basic types of cooperation. For example, while statistical transfers aim at short-term solutions to increase the share of renewable energy, large-scale projects aim more at infrastructure cooperation, energy security, innovation and better use of RES potential. The same applies to the most important aspects that need to be defined for setting up a cooperation project. As the complexity of the cooperation increases, so does the number of aspects that need to be considered. However, in terms of existing EU instruments, the presentation showed that each type of cooperation is suitable for different EU instruments.
Member States are increasingly recognizing the opportunities in cross-border approaches for renewable energy development, which is why the number of cross-border cooperation has increased recently. Denmark and Estonia already have extensive experience with different types of cooperation. Already in 2016, Denmark has conducted an open tender for PV plants together with Germany. In the meantime, Denmark has also conducted a statistical transfer with Ireland and the Netherlands, and numerous discussions are currently taking place in the area of offshore cooperation. Estonia has also already conducted a statistical transfer with Luxembourg and Ireland. In addition, there is a Memorandum of Understanding with Latvia for a joint offshore project. The experience in Luxembourg has shown that due to the time gap in the delivery of correct figures by Eurostat, one of the main challenges is to identify the surplus for the calculations. This will be one of the problems to be solved in the future. In addition, the discussion showed that, among other things, the price, the purpose, the large number of departments involved, and the agreement are important issues that need to be addressed when setting up a cross-border project.
Session 12: Joint Session CT1/CT2: CEEAG: Reconciling competition and target achievement in times of higher ambition
This session discussed experiences of Member States with supporting renewable energy development through tenders and the challenges for existing systems in light of increasing target ambitions. The session included a presentation of DG COMP on the CEEAG, the Spanish auctions on RES electricity conducted in 2017 and a presentation on auction volumes for target achievement.
State Aid is considered an essential tool in reaching Green Deal goals, although other instruments are also used by the Member States. The main objective of competition rules, however, is to preserve competition and the integrity of the internal market. A proposal for Climate, Energy and Environmental Aid Guidelines (CEEAG) has been made by the Commission and it is planned that the CEEAG enters in force in 2022. The two main buildings blocks of the revision are: a) An enlargement of the scope of the guidelines to cover new areas and technologies that can deliver the Green Deal (b) a flexibilisation of the compatibility rules including the provision of higher aid amounts (100% of funding gap) and new aid instruments (e.g. CCfD). The scope of the proposed Guidelines is extended to all technologies that reduce greenhouse gases, including renewable energy sources, and improve energy efficiency. However, specific renewable schemes continue to be possible. The new guidelines will be more flexible regarding renewable-specific support schemes and technology-specific support schemes and auctions. Also, more generally, the experience gained with tenders in the renewable electricity sector is being brought into new areas.
The General Block Exemption Regulation (GBER), a key tool, is also being revised to facilitate wider and newer exempted possibilities to support renewables and other decarbonisation measures, including renewable hydrogen and storage and recognise the importance of renewable energy communities.
The Spanish experience with RES-e auctions in 2017 was also presented. In these auctions, support was granted by assigning a quota (e.g. 50 MW), not to specific facilities, which allowed project developers to choose the best locations and reduced the price. In addition, no pre-qualification requirements were imposed on the projects. The lack of prequalification requirements was effective, reducing the administrative burdens and accelerating the auction call. Generally, there was a very good response from project developers to the call for tenders. The auctions were oversubscribed and subsidies were reduced to a minimum (zero). The penalty system in place helped ensuring a high overall execution rate (over 70%).
The presentation on auction volumes and target achievement showed that the goal should be to set the auction volume high enough to reach the RES targets but still ensure competitiveness of RES auctions. In addition, other supporting measures are necessary to increase RES supply and ensure competition such as setting reliable long-term targets and auction schedules to give RES project developers sufficient certainty and time to build up a project pipeline and supply chains. Spatial planning that allows for the designation of areas for renewables is also a key element. Moreover, simplifying and speeding up permitting procedures is helpful.
Thereafter, Member States expressed their views on a variety of questions related to exceptions from the tendering requirement (e.g. for small installations and pilot projects), the use of technology-specific or technology-neutral options to support decarbonisation and monitoring RES support.
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CA-RES4_PM1_Highlights CT1-2 Joint Session
2nd Plenary Meeting, 18th-19th May 2022, Online
Session 1: Regional Cooperation: Implementation Issues
The session dealt with Member States' experience with cooperation, implementation issues and the question how these might be overcome. It also discussed the current status of the main instruments that have been introduced to facilitate cross-border cooperation and have since come into force.
While the number of realised cooperation projects is still rather low (<10) and cooperation has mostly taken the form of one-off statistical transfers, increasing activity has been observed recently and concrete plans for joint projects and support programs between Member States are gaining momentum. This is also reflected in the growing number of cooperation agreements, memoranda of understanding and letters of intent that are being discussed or have been signed as well as the intensifying discussions on cooperation matters in regional fora, including the North Seas Energy Cooperation (NSEC), the Baltic Energy Market Interconnection Plan (BEMIP), the Central and South Eastern Europe Energy Connectivity (CESEC) or the Pentalateral Forum.
The session started with a presentation by Research from Fraunhofer Isi addressing the implementation barriers to cross-border cooperation in the field of renewable energy and ways to overcome them. The experts highlighted the key motivations for Member States for RES cooperations and pointed out the wide range of key enabling factors. They identified key barriers in numerous areas, including political, technical, legal, regulatory, administrative and socio-economic as well as environmental. hey detailed the following four selected barriers and identified potential solutions to overcome them:
- Identifying appropriate cooperation partners,
- Quantification and analysis of costs and benefits,
- Sharing of costs and benefits and
- Dealing with the complexity of cooperation and multiple stakeholders‘ perspectives.
This was followed by a best practice presentation from Portugal on implementation issues. This focused on additional cooperation tools that can complement the legal instruments of RED (regional forums). They underlined the importance and benefits of regional cooperation. In addition, some insights were provided on how to overcome the main obstacles.
The European Commission gave an Update on the development on two EU policy instruments, the EU Renewable Energy Financing Mechanism (REFM) and the Connecting Europe Facility- Cross-border Renewable Energy Projects (CEF-RES). The REFM is a tool to implement competitive EU-wide tenders in support of new renewable energy projects. The CEF-RES – an instrument to support RE projects that are launched through a cooperation agreement and have a net socio-economic benefit – includes grants for preparatory studies, for technical studies, and for works.
The European Commission also presented what is to come in 2022, this includes esp.:
- CEF-RES: CINEA will implement the call for proposals (Q3 – Q4 of 2022).
- REFM: Yearly call on Member States to express interest is over, a few Member States expressed interest; The European Commission is aligning the preferences of contributing and host countries based on the MS interest (and the compromise)
Information will follow on the dedicated webpage: https://energy.ec.europa.eu/topics/renewable-energy/financing/eu-renewable-energy-financing-mechanism_en
Session 2: Two instruments to speed up development of RE - Acceleration of planning and permitting procedures and PPAs
The second Session of CT 1 focussed on acceleration of planning and permitting procedures and PPAs as instruments to speed up the development of RES. It was divided into two parts: The first part dealt with accelerating permitting and planning processes, while the second part was about power purchase agreements (PPA). Both parts very closed linked to the Session of CT 2.
First part: Planning and permitting procedures
The Session showed, that overly complex and lengthy planning and permitting procedures remain a major barrier for the deployment of renewables and the related grid infrastructure. It is crucial to remove regulatory barriers in the administrative procedures.
In this context, the European Commission has presented the following two measures to remove the main barriers in the permitting procedures. Two measures were taken:
- permitting package with recommendations, best practices from a KOM guidance and a legislative proposal. The goal is to speed up procedures and reduce complexity
- Technical Support Instrument (TSI): It covers a range of reform areas and provides tailored technical expertise to Member States (MS) for design and implementation of reforms. Support is provided upon request and does not require co-financing (for the period 2021-2027, the TSI has a budget of EUR 864 million).
This was followed by an input presentation from Italy on their experience with barriers in planning and permitting procedures. It was shown that already the identification of suitable areas for RE projects can be a crucial point. It can also be important that the responsible levels take responsibility for the work to be done here.
This part is a good complement to the CT 2 session where examples of good practice are discussed in depth as a next step.
Second Part: Strengthening of PPAs
In the session, we discussed the barriers that still exist for green PPAs and way how MS and the European Commission can remove these obstacles. With the increasing deployment of renewable energies and, at the same time, higher targets in the context of the Green Deal, the question of additional private investments in RES deployment pro-jects is also coming more into focus. PPAs are one such market-based instrument that is currently evolving in this context. The Session showed that PPA can play an important role in the future.
The European Commission is trying to help overcome existing barriers with guidelines as part of the RePower EU licensing package: The European Commission addressed regulatory issues against this background. There is an expanding market for PPAs, and the COM explained ways to promote cross-border PPAs.
The European Investment Bank (EIB) then presented the results of a recent PPA market study it conducted. This examines the market for cPPA, its potential up to 2030, the barriers and an assessment for potential financial instruments complementing PPAs.
The Session shows, that financial risk, (most importantly counterparty risk and market risk) and regulatory barriers are the most important factors that we need to overcome.
This part was very closely linked to CT 2's session on PPA, which focuses more on seller and buyer perspectives in a second step. The contents are coordinated and interlock with each other.
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3rd Plenary Meeting, 09th-10th November 2022, Athens
Session 2: Governance: Upcoming progress reports according to Article 17 of the Governance Regulation
Focus of this session was on the Member States’ first progress reports (NECPR) on the achievement of their planned contributions, as set out in their first NECPs. The first progress reports are due by 15 March 2023. A core question of this session was whether the current developments (FF55 package, REPowerEU, energy crisis) should already be reflected in the NECPR or only in the update of the NECP, which is due on 30 June 2023.
The session started with a presentation by Guidehouse introducing the topic and the core question. This was followed by a presentation of the European Commission (DG ENER), short inputs by some Member States, break out discussions in groups and reporting back to the plenary.
As presented by Guidehouse, major changes have occurred in the energy landscape, creating a need for higher ambitions towards 2030, as is currently discussed and negotiated between Member States, the Commission and the European Parliament (FF55 package, REPowerEU). An updating of the governance system for the achievement of the 2030 EU-level targets for renewable expansion is, however, not on the agenda. A question that arises from recent developments is whether/how the changes in energy targets, policies and measures should already be reflected in the MS’ upcoming NECPR. A Draft Implementing Act on the preparation of the NECPR encourages Member States to take due account of the Union’s increasing climate ambition […] and the increasing binding renewable energy and energy efficiency targets at Union level for 2030. Also, it states that Member States shall report progress towards objectives, including progress towards Unions` cli-mate-neutrality objective.
In its presentation, the European Commission gave an update on the status quo of the Implementing Act on the preparation of the NECPR and accompanying reporting guidelines (including how the most recent energy crisis is reflected by the act and the guidelines). An updated draft of the Implementing Act, which was discussed in the Energy Union Committee, received positive response by the Member States. It was announced that the final Implementing Act will be made available within a week with only minor changed to the draft. The accompanying reporting guidelines, which will be made available in December 2022 or January 2023 will give more explanation on what is expected in the reporting tables, also showing examples of data inputs. Furthermore, the Commission an-announced that the E-platform will be available by the end of the year.
The European Commission invited Member States to already reflect on newly agreed goals in the NECPR. However, the Commission emphasized that its assessment of Member States’ progress will only be made towards the ambition levels set out in the first NECPs.
In their short interventions, Member State representatives reported on their current state of preparation of the NECPR and emphasized the view that the first NECPR and the updating of the NECP should not be mixed but regarded as separate processes.
In subsequent break-out sessions, participants discussed on the extent to which the current energy crisis impacts the envisaged progress reporting and the extent to which Member States consider upcoming policy changes in their progress reporting (e.g. increased RES target, hydrogen use in industry, etc.).
Member State participants unisono stated clear preference for including upcoming changes in tar-gets and policies in light of the current crisis in the NECP update rather than in the NECP progress reports. In addition, participants emphasized the urgency of guidance by the Commission and the provision of the e-platform, considering the timeline for the progress reports.
Session 14: Regional Cooperation: NECP updates according to Article 14 of the Governance Regulation
Focus of this session was on the update of the NECP that is due on 30 June 2023 and how current policy changes (FF55 package, REPowerEU, etc.) should be incorporated in the update.
The session started with a presentation by Guidehouse introducing the topic and the challenges at hand, given the ongoing negotiations on significant increases in overall ambitions and the limited time to achieve updated targets until 2030. This was followed by a presentation of the European Commission (DG ENER), short inputs by some Member States, break out discussions in groups and reporting back to the plenary.
As presented by Guidehouse, major changes have occurred in the energy landscape, creating a need for higher ambitions towards 2030, as is currently discussed and negotiated between Member States, the Commission and the European Parliament (FF55 package, REPowerEU). The timeline up to 2030 is very tight. Upcoming cornerstones of the reporting cycle are the updating of NECPs until 30 June 2024 and reporting on progress towards the second reference point in (reaching 43% of the total RE increase by 2025) in the second progress report until March 2025. It is likely that national contributions for the year 2025 are collectively too low to achieve the reference point to-wards the EU-level target. The question therefore arises how to deal with a potential collective underachievement of the 2025 reference point and how to maintain a strong and robust governance system.
In its presentation, the European Commission announced that guidance on the updates of the NECP will be published soon and will be discussed with Member States in the WG 2 of the Energy Union Committee. In addition to the guidance, technical assistance will be available to support Member States also in their modelling efforts. Despite the deep changes to the 2030 energy framework which are currently discussed as well as a list of new strategies at EU level (Offshore Strategy, Hydrogen Strategy, EU Solar Energy Strategy, etc.) the basic structure of the NECP will remain unchanged. Also, a review of the governance system itself is not on the table at the moment.
In their short interventions, Member State representatives reported on their current state of preparation of the draft update NECP and emphasized the view that there is no need to make the current governance system more dynamic. Also, Member State representatives stated difficulties in anticipating the impact of FF55 & RePowerEU in the draft update NECP since negotiations are still ongoing. Furthermore, Member State representatives called for a stronger focus on regional cooperation in light of the challenges ahead. This entails for example a stronger focus on regional consultation of updated NECPs but also making the new EU Renewable Energy Financing Mechanism more at-tractive for hosting Member States.
In subsequent break-out sessions, participants discussed the impacts of the ongoing energy crisis and of the EU-level initiatives in response to the crisis (REPowerEU, etc.). Some participants emphasized that high electricity prices and the high volatility of prices have a negative impact on electrification solutions and support schemes. As a result, investment decisions may be held back at the moment. Also, the long lead times from implementation of policies to realization of projects are a challenge for the achievement of updated targets.
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