EPIA warns Europe to carefully consider methods of financing solar PV before acting

Back in January, the European Commission (EC) released a communication entitled “Renewable Energy: Progressing to 2020”, in which it suggests ways to ensure a more cost-effective financing of renewables. After analysing the paper, the European Photovoltaic Industry Association (EPIA) has stated that the solutions the EC proposes may be “non-optimum”.
EPIA warns Europe to carefully consider methods of financing solar PV before acting

In its communication, the EC analyses a wide range of tools used to support renewable energy technologies in the European Union with the aim of ensuring that money is spent cost-effectively. While EPIA welcomes the Commission’s efforts in this field, in a recent statement it expressed concerns about some propositions “that could prove to be counter-productive” and underlines the importance of maintaining and fine-tuning existing successful national support schemes and addressing bureaucratic barriers.

EPIA fully supports the Commission’s general objective, in particular the importance of adapting instruments in order to avoid excessive returns on capital. However, the trade association recommends that PV investment profitability should be assessed on a regular basis and support schemes adapted accordingly in a predictable manner. “Well-designed and evolutionary support schemes are the key market drivers for a sustainable PV deployment;” it emphasises.

“As correctly pointed out in the EC communication, the bulk of the support for renewable energy is delivered today by the Member States. It is therefore important to act where adaptations can really make the difference, i.e. at the national level,” says EPIA. Referring to the EC’s assessment that the evolution to feed-in premiums should be reinforced, it is still to be demonstrated that such a shift would be more efficient for the development of renewables and photovoltaics in particular, the association continues.

While recognising the need to adjust supporting tools on a country specific basis, EPIA considers that some of the evolutions proposed in the communication at the European level could prove to be counter-productive.

Referring to the EC’s call to achieve a greater convergence of national support schemes to facilitate trade; EPIA believes such an approach could deprive Member States from a real control on their binding national target and could eventually cost more to the European citizens. EPIA considers that the Renewable Directive is already providing the appropriate framework, in order to develop renewables at the best cost-effective way while taking into account the maturity of the different technologies.

Bringing down administrative barriers

Finally, when it comes to financing, “huge savings can also be achieved by tackling bureaucratic barriers,” says EPIA. The European PV Legal project (www.pvlegal.eu) has shown that in certain countries, compliance with administrative and grid connection procedures can represent up to half of the development cost of a project.

PV Legal partners concluded recently that it is time to act and remove administrative barriers and to ease grid connection processes in Europe. Over the last six monthly, the national partners of the project organised a road show in seven European Union countries, including national conferences in Italy, Germany, Spain, Greece, Slovenia, France and Poland. The conclusions from each event are unanimous: “long and inefficient administrative processes are an unnecessary cost born by the society and constitute a severe barrier to the development of the photovoltaic (PV) market” says Thomas Chrometzka, Head of International Affairs at BSW-Solar, the German Solar Industry Association, coordinator of the PV Legal project.

The first PV Legal status report presented at each of these events reflects how burdensome administrative processes can unnecessarily slow down the development of a PV project not to mention increasing its cost. In the case of large systems (Segment C) complying with legal-administrative barriers can represent up to 50% of the overall development cost in Spain for example, while this is limited to 8% in Germany and less than 20% in Bulgaria.

The PV legal project partners are developing detailed recommendations in order to improve these processes, which come at the right time as the EC is analysing the National Renewable Energy Action Plans provided by each of the 27 EU member States as we speak.

“We hope both national decision makers when transposing the RES Directive and the European Commission will consider these advises [sic] which are being developed based on unique expertise on administrative and grid connection processes for PV system development at EU level” concludes Marie Latour, National Policy Advisor at EPIA.

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