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Infrastructure for Renewable Energies: a Factor of Local and Regional Development

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Infrastructure for Renewable Energies: a Factor of Local and Regional Development DIRECTORATE GENERAL FOR INTERNAL POLICIES POLICY DEPARTMENT B: STRUCTURAL AND COHESION POLICIES REGIONAL DEVELOPMENT INFRASTRUCTURE FOR RENEWABLE ENERGIES: A FACTOR OF LOCAL AND REGIONAL DEVELOPMENT STUDY This document was requested by the European Parliament's Committee on Regional Development. AUTHORS Austrian Institute for Spatial Planning (ÖIR): Bernd Schuh, Erich Dallhammer SWECO International AB: Niclas Damsgaard Erin Nicole Stewart RESPONSIBLE ADMINISTRATOR Esther Kramer Policy Department B: Structural and Cohesion Policies European Parliament B-1047 Brussels E-mail: [email protected] EDITORIAL ASSISTANCE Lea Poljančić LINGUISTIC VERSIONS Original: EN Translation: DE, FR. Executive summary: BG, CS, DA, DE, EL, EN, ES, ET, FI, FR, HU, IT, LT, LV, MT, NL, PL, PT, RO, SK, SL, SV. ABOUT THE PUBLISHER To contact the Policy Department or to subscribe to its monthly newsletter please write to: [email protected] Manuscript completed in May 2012. Brussels, © European Union, 2012. This document is available on the Internet at: http://www.europarl.europa.eu/studies DISCLAIMER The opinions expressed in this document are the sole responsibility of the author and do not necessarily represent the official position of the European Parliament. Reproduction and translation for non-commercial purposes are authorized, provided the source is acknowledged and the publisher is given prior notice and sent a copy. DIRECTORATE GENERAL FOR INTERNAL POLICIES POLICY DEPARTMENT B: STRUCTURAL AND COHESION POLICIES REGIONAL DEVELOPMENT INFRASTRUCTURE FOR RENEWABLE ENERGIES: A FACTOR OF LOCAL AND REGIONAL DEVELOPMENT STUDY Abstract This study draws a picture of the infrastructure development in the main renewable energy sectors (wind, solar, biomass, hydroelectric, geothermal) in European regions. It explains how projects developing regional infrastructure for renewable energy are financed in the current programming period of Structural Funding and it analyses the quality of these provisions. Finally, the study explores the existing and future measures for renewable energy infrastructure as well as electricity network plannings in Cohesion programmes and in the National renewable energy plans. IP/B/REGI/FWC/2010-002/Lot4/C1/SC2 May 2012 PE 474.556 EN Infrastructure for renewable energies: a factor of local and regional development CONTENTS EXECUTIVE SUMMARY 13 1. INTRODUCTION 21 2. THE CONTEXT OF EU ENERGY MARKETS 25 2.1. Current EU energy policy 26 2.2. EU Energy market structures – the inconvenient heritage 28 2.3. Proposed remedies by EU policy in general 29 2.4. Remedies in the area of energy infrastructure 30 3. ERDF/COHESION FUND EXPENDITURES 33 3.1. Structural Funds and renewable energy infrastructure 33 3.2. Other support of renewable energy infrastructure through EU co-funding (2007 – 2013 programming period) 36 3.2.1. Intelligent Energy Europe Programme 36 3.2.2. European Agricultural Funds for Rural Development 37 3.2.3. Other EU funding sources for renewable energy infrastructure: 37 4. CASE STUDIES 39 4.1. Selection of the case studies 39 4.2. Methodological approach and limitations 40 4.3. Austria 41 4.3.1. Introduction 42 4.3.2. Güssing – socio-economic impact of renewable energy investments 42 4.3.3. Vöckla-Ager – aiming at supporting local economy and energy efficiency 46 4.3.4. Conclusions 50 4.4. Portugal 50 4.4.1. Introduction 51 4.4.2. Madeira – facing the challenge of limited capacity of energy storage 51 4.4.3. Azores – an experimental ground for appropriate technologies 54 4.4.4. Conclusions 58 4.5. Romania 59 4.5.1. Introduction 59 4.5.2. Romania – following a centralized approach 59 4.5.3. Conclusions 65 3 Policy Department B: Structural and Cohesion Policies 4.6. Sweden 66 4.6.1. Introduction 66 4.6.2. Upper-North Sweden - example for unused potential 66 4.6.3. Upper-North Sweden - also an example for good practise 69 4.6.4. Conclusions 72 4.7. United Kingdom 73 4.7.1. Introduction 73 4.7.2. Scotland – funds supports offshore grid expansion 75 4.7.3. Wales – stunted by limited grid connectivity 80 4.7.4. Conclusions 83 5. CONCLUSIONS AND RECOMMENDATIONS 89 5.1. Research Questions 90 5.2. Smart Grids as answers to renewable energy supply? 94 5.3. Identifications of regions suitable to boost renewable energy infrastructure 94 5.4. The problem of energy (electricity) grid support 97 5.5. Recommendations 98 REFERENCES 101 4 Infrastructure for renewable energies: a factor of local and regional development LIST OF ABBREVIATIONS ADENE Portuguese Energy Agency AIR Annual Implementation Report AREAM Regional Agency for Energy and Environment of Madeira BEMIP Baltic Energy Market Interconnection Plan CAP Common Agricultural Policy CBC Cross Border Countries CCS Carbon Capture and Storage CHP Combined Heat and Power CO2 Carbon dioxide COP Corporate Operational Plan DG Regio Directorate General for Regional Policy EACI Executive Agency for Competitiveness and Innovation EAFRD European Agricultural Fund for Rural Development EBRD European Bank for Reconstruction and Development EC European Commission ECCC Edinburgh Climate Change Centre EEM Electricidade da Madeira EERP European Economic Recovery Plan EIB European Investment Bank ELENA European Local ENergy Assistance ENNEREG Regions paving the way for a Sustainable Energy Europe ENPI Kolarctic programme EOWDC Aberdeen Offshore Wind Farm and European Offshore Deployment Centre ERDF European Regional Development Fund ESEP East of Scotland European Partnership ESF European Social Fund ETG Electricity Transmission Grid EU European Union EU ETS Emissions Trading Programme EUR Euro GBP Pound Sterling 5 Policy Department B: Structural and Cohesion Policies GDP Gross Domestic Product GWh Gigawatt hour HIPP Highlands and Islands Partnership Programme IB/MA Intermediate Bodies/Management Authorities ICT Information and Communication Technologies IEE Intelligent Energy Europe IFI International Financial Institutions INTERREG Community initiative aiming at stimulating interregional cooperation ISLES Irish-Scottish Links on Energy Study JASPERS Joint Assistance to Support Projects in European Regions JEREMIE Joint European Resources for Micro to Medium Enterprises JESSICA Joint European Support for Sustainable Investment in City Areas KAI Key Area of Intervention km2 Square kilometer kW Kilowatt LCRI Low Carbon Research Institute Energy Programme LEADER Liaison Entre Actions de Développement de l'Économie Rurale LRF Farmers Federation LUPS Lowlands and Uplands Scotland MAC Transnational Cooperation Programme Madeira-Açores-Canarias MW Megawatt MWh Megawatt hours NGO Non-Governmental Organisation NREAP National Renewables Action Plan NSRF National Strategic Reference Framework NUTS Nomenclature of Units for Territorial Statistics OP Operational Programme OR Outermost Region ÖROK Austrian Conference on Spatial Planning PA Priority Axes PPEC Consumption Efficiency Promotion Plan PPERAMM Madeira’s Regional Energy Policy Plan 6 Infrastructure for renewable energies: a factor of local and regional development PPP Purchasing Power Parity PRAI Programme of Innovation Actions PRODESA Operational Programme of the Autonomous Region of Azores R&D Research and Development RDI Research, development and innovation RES Renewable Energy Source REVA Regionalverband RSFF The Risk Sharing Finance Facility SEACAMS Sustainable Expansion of the Applied Coastal and Marine Sectors SEGEC Scottish European Green Energy Centre SME Small and Medium-sized Enterprises SO2 Sulfur dioxide SOP Sectoral Operational Programme SOP-IEC Sectoral Operational Programme – Increase of Economic Competitiveness SPD Single Programming Document SRAM Regional Secretariat of the Environment and Sea SSA Strategic Search Area STRAT.AT Nationaler Strategischer Rahmenplan Österreichs SWOT Strengths, Weaknesses, Opportunities, Threats TAN Technical Advice Note TEN-E Trans-European Energy Network TSO Technical Standards Organisations TWh Terawatt hour TYNDP Ten-Year Network Development Plan UK United Kingdom USD US Dollar WAG Welsh Assembly Government WATERS Wave and Tidal Energy: Research, Development and Demonstration Support Fund WEFO Wales European Funding Office 7 Policy Department B: Structural and Cohesion Policies 8 Infrastructure for renewable energies: a factor of local and regional development LIST OF TABLES Table 1 EU regional policy contribution to renewable energy infrastructure in the ongoing period 34 Table 2 EU funds allocated to energy in the Member States of the case studies 40 Table 3 List of Beneficiaries of the operational Programme Burgenland 2007-2013 (Objective Convergence/ERDF) 45 Table 4 List of Beneficiaries of the operational Programme Oberösterreich 2007-2013 (Objective Regional Competitiveness and Employment/ERDF) 49 Table 5 Expected RES investments in the Azores, 2007-2013 57 Table 6 Contracted renewable energy projects under SOP IEC PA4 64 Table 7 Renewable energy projects and energy infrastructure funded under the Highlands and Islands partnership in 2011 78 Table 8 Renewable energy projects and energy infrastructure funded under the ESEP from the LUPS in 2011 79 Table 9 ERDF spending on renewable energy for East and West Wales 83 Table 10 Summative Findings of the case studies 85 9 Policy Department B: Structural and Cohesion Policies 10 Infrastructure for renewable energies: a factor of local and regional development LIST OF MAPS Map 1 Budgeted Renewable Energy Funding 2007-2013 35 Map 2 Overview over the case study regions 39 Map 3 Transmission network in Madeira 52 Map 4 Proposed
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