EGEC 2020 Winter Statement on Energy Policy

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  • PUBLISHED: January 26, 2021

A briefing on recent (the last 6 months) and upcoming energy policy in the EU and in some European countries.

Last autumn the political agenda in Brussels has been fed with a series of new policy initiatives focusing on energy and climate: the European Commission’s communications on the buildings renovation wave, the offshore strategy, the 2030 Climate Target Plan, and the legislation on TEN-E. The European Commission has also launched the revision of the Renewable Energy Directive and the Energy Efficiency Directive.

The highlight has been the new ambition adopted in the framework of the European Green Deal with now a 55% target  to reduce greenhouse gas emissions by 2030.

So why some of us think that the European Green Deal is at risk ? Mainly because the EU debate is still dominated by silver bullet solutions such as hydrogen, green gas and electrification (not always with renewable energy) amid a simplification of the debate on decarbonisation and the protection of fossil subsidies.

We deeply regret not to see a recognition of the huge potential for geothermal electricity, even though geothermal energy reduces the overall systems costs for the society, not only for the consumers. But the debate on external costs is coming, as one can see in the EU Parliament’s debates.

With heating being the single largest energy use in the world, its decarbonisation has now to be the policy priority. Geothermal energy is the most competitive energy source, so it can become mainstream thanks to its countless applications: heat pumps, district heating, combined heat and power in building, services, agri-food, industrial heat… The geothermal decade will be faster than expected!

And now a tour d’Europe…

 

Italy:

In Italy the recovery after the summer break has been catalysed by actions to stem the effects of the economic crisis generated by the COVID-19.

The authorisation procedures for geothermal projects incentivised by the decrees of the past few years have been blocked at various levels (national, regional, appeals by committees, etc.) and to date none of these projects has started construction.

The long-awaited RES2 decree, an instrument identified to implement new geothermal projects and other renewable sources, has been announced several times but there are no indications of timing or contingencies. On the contrary, the RES1 decree, which has regulated the most mature sources (PV, wind, hydro) in the past years, has been implemented through auctions.

There are no clear steps forward in reducing authorisation procedures for existing and new RES projects.

Among the novelties, the legislative measure allowing the development of energy communities and self-consumption was approved.

The projects to be included in the Recovery Plan to be presented in Brussels in 2021 are currently being discussed. There is no evidence of the weight assigned to geothermal energy.

By Marco Baresi, EGEC Vice-President & Sara Montomoli, EGEC Board member

 

France:

Despite of the pandemic, France recorded extraordinary geothermal developments in the Paris Basin with the completion of three geothermal doublets for district heating and a fourth ongoing drilling/completion. These doublets for district heating will be commissioned in 2021. Deep geothermal projects continue to be supported by the Heat Fund and the SAF-E Short term and Long-Term Guarantee Fund. A working group was created to draw the guidelines to upgrade the SAF-E Risk Guarantee Fund, aiming at the development of 5.3TWh geothermal supply all over the country by 2030.

The good news is that as from June 2021 in France no new private building can be heated by gas or fossil fuels. Therefore renewable energy, among which geothermal is one of the best placed is a priority for the energy supply in buildings.

We are looking forward to a stimulating 2021 with many new projects in the pipeline both in the traditionally developed Paris Basin and in other French cities.

By Miklos Antics, EGEC President

 

Germany:

Germany is one of the leading markets for shallow geothermal energy in Europe. The sales figures for geothermal heat pumps increased by around 10-15% in 2020. This is mainly due to government funding programs.

Geothermal energy has experienced a particular upswing in the development of quarters (apartments and businesses) and the establishment of cold local heating networks (residential buildings in rural areas). When building single-family houses, geothermal energy is often already the standard.

Politics and business agree that heat pumps will have to play a central role in the energy transformation of the coming years. Barriers can currently be seen in the high electricity price, which is burdened by 65% levies, and an overregulation of the approval process.

The legal framework for the deep geothermal energy sector is improved by stabilizing the feed-in tariff for electricity and the possibility of feed-in tariffs for heat. In the future, the conversion of district heating outside of Munich will be important also in the Ruhr area and northern Germany.

By Rudiger Grimm, EGEC Board member

 

 Spain:

Regarding Shallow Geothermal:

The situation of the Spanish market is always difficult to characterize due to the lack of a solid historical series and statistical figures. IDAE, the responsible Office for the Ministry, started this year an internal project to obtain more solid numbers but it hopelessly entered into the same difficulties of previous attempts: 11 different administrations with different rules regarding the register of installations and lack of an overall framework for Spain. Anyway they arrived at two conclusions: the total installed capacity is well above 350 MWth and the market is growing. Regions like Galicia, Catalonia, Madrid and Basque country are in the forefront of the Shallow Geothermal market.

There is also a generalized feeling that geothermal is more and more in the focus due to the new policy framework in regard to building refurbishment and obligations. Plans are ambitious and administrations are more and more aware of the potential. I have met with officials of our Regional Administration that wanted to talk with us about a “plan for geothermal energy in the Valencian Area”. Never too late if it’s for good!

Furthermore there is a new generation of architects in the market for which geothermal is not anymore something exotic and for research.

On the backside: the construction sector has been stopped by COVID-19 and this has strong impact, as still most projects are new built commercial size buildings.

 

Regarding Deep Geothermal:

There are two major situations to report. On one hand a big 8 MWth project for geobased greenhouses in the South of Spain has been started. This is absolutely new and could really be a driver, since agriculture is very big here.

The second is the renewed interest from the Ministry and the Canary Island Administration to revive the idea of a geothermal electricity production plant in the Islands. I talked personally with high officials of the Ministry and they see this as a “flagship” for Spain. The big interest for geothermal in other parts of Europe, notably Germany and Netherlands, was mentioned by them as a triggering factor.

By Javier Urchueguia, EGEC Vice-President

 

Hungary:

According to a ministerial Decree , the Hungarian Energy and Public Utility Regulatory Authority will launch some calls for tenders to support renewable electricity producers. The second tender was announced in July 2020, application started in September and finished in October 2020. The involved capacity is significantly increased.

The Mining and Geological Survey of Hungary created the Hungarian Geothermal System, an interactive online digital map. It is under testing now. The System is going to issued early 2021.

Finally, the Ministry of Innovation and Technology is preparing the launch of the first Hungarian Geothermal Risk Mitigation System.

By Attila Kujbus, EGEC Treasurer

 

Romania:

The Romanian Environment Fund Administration has launched the « Green House Plus » Programme, focused on both private and public buildings. The programme aims to increase the energy efficiency of new or existing buildings. The available funding reaches around € 9,000 for private buildings and around € 100,000 for public buildings. The funding is awarded on the basis of a complex dossier, containing – among others – the energy performance certificate of the building stating its « A » energetic class, which requires the use of renewable energy sources.

The National Monitoring Committee of the Great Infrastructures Programme has organised a national debate on the use of European funds available for the next development period 2021-2027. The use of geothermal energy for heating and cooling is strongly considered among the funding directions.

By Robert Gavriliuc, EGEC Board Member

 

Have a good reading and recharge your batteries for the first semester2021 to faster decarbonise our economy.

See you for the Summer Statement in July 2021.

 

Philippe Dumas, EGEC Secretary general

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