THE STATE OF RENEWABLE ENERGIES IN EUROPE EDITION 2016 16th EurObserv’ER Report This barometer was prepared by the EurObserv’ER consortium, which groups together Observ’ER (FR), ECN (NL), RENAC (DE), Frankfurt School of Finance and Management (DE), Fraunhofer ISI (DE) and Statistics Netherlands (NL). This project is funded by the European Union under contract no ENER/C2/2016-487/SI2.742173 The information and views set out in this publication are those of the author(s) and do not necessarily reflect the official opinion of the Commission. The Commission does not guarantee the accuracy of the data included in this study. Neither the Commission nor any person acting on the Commission’s behalf may be held responsible for the use which may be made of the information contained therein. THE STATE OF RENEWABLE ENERGIES IN EUROPE EDITION 2016 16th EurObserv’ER Report 2 3 EDITORIAL by Vincent Jacques le Seigneur 4 Investment in Renewable Energy Technology 176 Venture capital – private equity 178 Energy indicators 7 Performance of RES technology firms and RES assets 182 Wind power 8 On the whole 188 Photovoltaic 14 Solar thermal 20 Renewable energy costs, Small hydropower 26 prices and cost competitiveness 191 Geothermal energy 30 Heat pumps 36 Biogas 42 Avoided fossil fuel Biofuels 50 use and resulting avoided costs 197 Renewable urban waste 56 Solid biomass 62 Concentrated solar power 70 Indicators on innovation Ocean energy 76 and competitiveness 205 Integration of RES in the building stock and urban infrastructure 80 Conclusion 84 Public R&D Investments 206 Wind power 208 Socio-economic indicators 95 Solar Energy 209 Hydropower 210 Geothermal energy 211 Wind power 98 Biofuels 212 Photovoltaic 102 Ocean energy 213 Solar thermal 106 All RES 214 Small hydropower 110 Geothermal energy 114 Patent Fillings 216 Heat pumps 116 Wind power 218 Biogas 120 Solar Energy 220 Biofuels 124 Hydropower 222 Renewable urban waste 128 Geothermal energy 224 Solid biomass 130 Biofuels 226 Employment and turnover for 2015 134 Ocean energy 228 Conclusions 230 Investment Indicators 141 International Trade 233 All RES 234 Investment in Renewable Wind power 236 Energy Capacity 143 Photovoltaic 238 Wind power 144 Hydropower 240 Photovoltaic 150 Conclusions 242 Biogas 154 Renewable urban waste 158 Indicators on the flexibility Solid biomass 160 of the electricity system 245 Other RES sectors 164 International comparison Results and Interpretation 247 of investment costs 168 Public finance programmes for RES investments 172 Sources 252 EUROBSERV’ER – THE STATE OF RENEWABLE ENERGIES IN EUROPE – 2016 EDITION EUROBSERV’ER – THE STATE OF RENEWABLE ENERGIES IN EUROPE – 2016 EDITION 4 5 EDITORIAL EDITORIAL SETTING THE RECORD STRAIGHT Vincent Jacques le Seigneur, President of Observ’ER Once the European renewable energy data has been – wind energy and photovoltaic – both for the British The 2016 edition of this report has additional sections digested, it is clear that a number of preconceived who have introduced ceilings to hem in PV power’s broaden understanding of how renewable energies notions are effectively riddled with holes and that the annual growth rate and for the rest of Europe because are developing in the European energy, economic data sets the record straight on wishful thinking about of industrial manufacturing overcapacity and the and environmental context. The state of renewable the economics of the various sectors. So looking at the replacement of the Feed-in Tariff system by tendering. energies report has been expanded to include the European renewable energy sales figures for 2015, Renewables are not only electric, far from it. The following new subjects in addition to the traditional which topped 150 billion euros, wind energy accounted figures for 2015 presented in this barometer report sections devoted to energy indicators, socioecono- for more than 30% of these figures compared to only a troubling situation for solar thermal that is on a mic aspects and investments made in the European 10% produced by photovoltaic. This ranking is almost relentless downward spiral abetted by the lack of Union’s renewable sectors: mirrored by the sectors’ job figures, for more than a public authority ambition and the low price of fossil • an appraisal of the penetration rates of renewable million people work in renewable energies in Europe. energies. The same applies to biogas, which remains energy equipment for heating and cooling and urban In these times of mass unemployment, that is no mean a niche market, and to deep geothermal energy that infrastructures; feat. However half of these workers live in Germany, produces heat and electricity in large installations • an overview of the main renewable sector costs and France and the United Kingdom, namely only three of but cannot compete with crude oil at such low prices. their levels of competitiveness in comparison with the twenty-eight Member States that currently form The contrast could not be more flagrant with the air the fossil fuel sectors; the European Union. source and ground source heat pump markets, which • an assessment of the impact of the development of increased by 20% for sales worth 21.4 billion euros and renewables on reducing fossil energy consumption Another home truth worth recalling even if it is not generated just as many jobs as photovoltaic. within the European Union and the expenses thereby exactly hot off the press is that the renewable energy averted; upswing is more the outcome of bold public policies Lastly we should mention biomass, whose importance • a full section on innovation and competitiveness than fickle weather. If proof of this were needed, we is too often overlooked. With sales of 36 billion euros indicators arising from R&D efforts in renewable can take a look at the UK which is hardly a sunshine in 2015, the sector employs almost as many individuals technologies. This covers public-sector R&D invest- destination. Nevertheless it consolidated its leader- as the renewable sector with the highest profile, wind ments, the result in terms of filed patents and a com- ship of the annual PV capacity installation stakes energy. Far too often it is forgotten that biomass is parison of the significance of the renewable sectors in 2015. The opposite applies to small hydropower, not only a source of heat. In 2015 biomass electricity by country for international trade; where the weather has to take the blame for its dismal output exceeded 90 TWh, meaning that it can stand its • indicators on how flexible European electricity sys- results. European output, whose potential is capped ground with photovoltaic, which generated more than tems are to integrating renewable capacities. by the total take-up of possible hydropower sites, 100 TWh for the first time. What is more, biomass pro- Henceforth EurObserv’ER will cover all these new dropped by 10% in 2015 because of the lack of rainfall. vides a useful complement as its output is not prone aspects in the forthcoming editions of its State of The future may be not so rosy for the two main sectors to any kind of variability. Renewable Energies in Europe report. EUROBSERV’ER – THE STATE OF RENEWABLE ENERGIES IN EUROPE – 2016 EDITION EUROBSERV’ER – THE STATE OF RENEWABLE ENERGIES IN EUROPE – 2016 EDITION Energy indicators 6 7 ENERGY INDICATORS EurObserv’ER has been gathering data on were published – small hydropower, biogas, the European Union’s renewable energy geothermal energy, concentrated solar sources for seventeen years for its theme- power, household refuse incineration and based barometer reports on the state of the renewable marine energy sources. sectors and their momentum. The first part Hence this publication offers a comprehen- of this work is a summary of the barometers sive energy dimension review of the twelve published in 2016 for the wind energy, solar renewable sectors that are now developed photovoltaic, solar thermal, heat pump, in the European Union on an industrial biofuel and solid biomass sectors. The data scale. drawn from these barometers has been It also gives for the first time a view of the updated and supplemented by data on the share of RES heating and cooling in the buil- sectors for which no individual barometers ding stock. Methodological note The tables reproduce the most recent figures avai- heat used by the undertaking for its own processes lable for each sector. In publishing this edition, the is not included. EurObserv’ER data and Eurostat data published early Final energy consumption is the total energy consu- in February 2016 have been fully reconciled. This med by end users, such as households, industry and reconciliation covers most of the energy indicators agriculture. It is the energy which reaches the final presented (electrical capacity, output, consumption, consumer’s door and excludes that which is used by etc.). However, the indicators used are solely those of the energy sector itself including for deliveries, and EurObserv’ER whenever there are no parallel indica- transformation. It also excludes fuel transformed in tors published by Eurostat, such as market data for the electrical power stations of industrial auto-pro- the various categories of heat pump or solar thermal ducers and coke transformed into blast-furnace gas collectors. where this is not part of overall industrial consump- As for the “heat” data, a distinction is made between tion but of the transformation sector. Final energy “derived heat” from the processing sector and final consumption in “households, services, etc.” covers energy consumption in line with Eurostat definitions. quantities consumed by private households, com- Derived heat covers the total production of heat in merce, public administration, services, agriculture heating plants and cogeneration plants (combined and fisheries. heat and power plants). It includes heat used by the A distinction is also made with regard to electricity auxiliaries of the installation which use hot fluid and derived heat production data between output (space heating, liquid fuel heating, etc.) and losses in from plants solely producing either electricity or the installation/network heat exchanges.