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Energy Systems and Technologies for the Coming Century ...

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8especially in <strong>the</strong> area of wind energy. However, <strong>the</strong> support level in <strong>the</strong>se countries is notparticularly high compared with o<strong>the</strong>r countries analysed here.6 ConclusionsThe major success stories of this growth in RES-E in EU member states in recent yearshas been triggered by FIT which are implemented in a technology-specific manner <strong>and</strong>involve ra<strong>the</strong>r modest costs <strong>for</strong> European citizens. The main reason <strong>for</strong> this observationis <strong>the</strong> long term price security of <strong>the</strong> system combined with technology diversification ofsupport. Compared to short term trading in renewable certificate markets <strong>the</strong> intrinsicstability of feed-in systems appears to be a key element <strong>for</strong> success.Currently a well-designed (dynamic) FIT system provides a certain deployment of RES-E in <strong>the</strong> shortest time <strong>and</strong> at ra<strong>the</strong>r low costs <strong>for</strong> society. The experiences made with FITsystems have shown several advantages compared to trading schemes at least <strong>for</strong> threereasons: (a) a FIT system is easy to implement <strong>and</strong> can be revised to account <strong>for</strong> newcapacities in a very short time; (b) administration costs are usually lower than <strong>for</strong>implementing a national trading scheme. This fact is especially important <strong>for</strong> smallcountries where a competitive national trading scheme is difficult to implement; (c) Theadvantage of a technology-specific FIT, which helps to diminish <strong>the</strong> producer surplus, is<strong>the</strong> higher <strong>the</strong> steeper <strong>the</strong> cost curve is.In recent years, quota-based TGC systems have shown a lower effectiveness (but withimproving tendencies where support is applied technology-specific via b<strong>and</strong>ing)although comparatively high profit margins are possible. Firstly, a major problem are <strong>the</strong>high producer profits <strong>for</strong> <strong>the</strong> cheapest options in <strong>the</strong> market given a steep cost curve asdepicted in Fig. 4. This leads to high additional costs <strong>for</strong> customers. Secondly, marketmechanisms seem to fail in TGC-systems In addition, it is hard to imagine that aEuropean-wide TGC market disconnected from <strong>the</strong> large incumbent generators willwork. The large incumbent utilities tend to favour TGC, since this scheme gives <strong>the</strong>m <strong>the</strong>chance to earn higher profits.Summing up a major result of <strong>the</strong>se analyses is that <strong>the</strong> investigated FIT systems areeffective at a relatively low producer profit. A well-designed (dynamic) FIT systemprovides a certain deployment of RES-E in <strong>the</strong> shortest time <strong>and</strong> at reasonable costs <strong>for</strong>society.7 References[1] European Parliament <strong>and</strong> Council, Directive of <strong>the</strong> European Parliament <strong>and</strong> of <strong>the</strong>Council on <strong>the</strong> promotion of electricity produced from renewable energy sourcesin <strong>the</strong> internal electricity market, Directive 2001/77/EC - 27 September 2001,Brussels, 2001.[2] European Commission, Directive on <strong>the</strong> promotion of <strong>the</strong> use of energy fromrenewable sources, Brussels, 2009.[3] Resch G, Faber T, Ragwitz M, Held A, Panzer C, Haas R. 20% RES by 2020 – abalanced scenario to meet Europe’s renewable energy target. Report compiled byTU Wien / EEG in cooperation with Fraunhofer ISI within <strong>the</strong> Intelligent <strong>Energy</strong><strong>for</strong> Europe - project futures-e (Contract no. EIE/06/143/SI2.444285), Vienna,Austria, 2008.[4] Johnston A, Neuhoff K, Fouquet D, Ragwitz M, Resch G,.The proposed new EUrenewables directive: interpretation, problems <strong>and</strong> prospects. European <strong>Energy</strong> <strong>and</strong>Environmental Law Review, 2008, 17(3),126–145.Risø International <strong>Energy</strong> Conference 2011 Proceedings Page 74

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