Potential for Renewable Energy Sources (RES) in
Grenoble, Delft & Växjö
JONAS TURESSON
Potential for Renewable Energy Sources
(RES) in Grenoble, Delft & Växjö
Jonas Turesson
Master of Science Thesis INDEK 2011:45
KTH Industrial Engineering and Management
Master of Science Thesis INDEK 2011:45
Potential for Renewable Energy Sources (RES) in Grenoble, Delft & Växjö
Jonas Turesson Approved 2011-06-08 Examiner Thomas Sandberg Supervisor Thomas Sandberg Commissioner Concerto-SESAC Contact person Thomas Sandberg
Abstract
Sustainable cities is an area that has grown in size over the last couple of years. The SESAC (Sustainable Energy Systems in Advanced Cities) is a EU-project looking at the potential to increase the share of Renewable Energy Sources (RES) and promote energy efficiency measures in different EU cities. This master thesis is a part of that project.
Specifically, the thesis examines the cities of Grenoble, Delft and Växjö and looks at what measures regarding RES and energy efficiency have been taken historically, both under the SESAC project and otherwise, and assesses the possibility of further measures in the cities. The main RES evaluated are wind power (large scale and urban), solar (PV and thermal) and waste treatment (waste incineration and biogas production). The feasibility of these renewable technologies is evaluated both physically, technically and economically for each city.
Further, the historical and current hinders and promoters in the form of different support schemes and other economic and institutional schemes are summarized for each country and city and the effects of which included in the feasibility calculations. Also, current CO2 emissions of Grenoble, Delft and Växjö are stated and the impact of implementing the measures examined is calculated. A comparison between the three cities is also made and suggestions are made to what they can learn from each other and what synergies there are.
RES potential [GWh] Grenoble Delft Växjö
Wind 458 1,2 (Urban only) 297-‐2000
Solar PV 375 150 0,06-‐0,3
Waste treatment 41 11 10
Table 1. Technical potential of RES in Grenoble, Delft and Växjö
Acknowledgements
I would like to address big thanks to Thomas Sandberg for his assistance in supervising and administrating this master thesis. He has been a big help during the whole process and contributed with priceless knowledge in helping finishing this report.
Also best regards to Jérome Buffiere, Joris De Jonge and Zeno Winkels for contributing with crucial information about Grenoble and Delft, without which it would have been impossible to write the thesis.
Thankfulness goes out to Charlotte Anners, Sofia de Maré and Emine Erdogan for letting me access their master theses on the solar, wind and waste treatment potential for Växjö. Their work has simplified my work greatly and a lot of ideas and inspiration has come from their reports.
Also thanks to the SESAC project for letting me write this thesis under its organization. Hopefully this report will help them further increase the share of RES in Grenoble, Delft and Växjö as well as
Table of Contents
1. Introduction ... 1
1.1 Sustainable cities ... 1
1.2 Information about the overlying project (SESAC) ... 1
1.3 Purpose and project description ... 2
1.4 Questions ... 2
1.5 Limitations ... 3
1.6 Method ... 3
1.7 Content overview ... 4
2. Theoretical Framework ... 5
2.1 Energy Balances ... 52.2 Renewable Energy Sources ... 7
2.2.1 Wind ... 7
Large scale wind power ... 7
Urban Wind Turbines ... 8
2.2.2 Solar ... 10
Solar PV ... 10
Solar Thermal ... 10
2.2.3 Waste treatment ... 11
Biological treatment ... 11
Waste incineration ... 11
Landfill ... 12
Potential Energy production ... 12
2.3 Energy Efficiency ... 12
2.4 Economic theory ... 13
3. Country Level ... 14
3.1 The EU-‐wide ETS ... 14
3.2 France ... 15
3.2.1 Renewable Potential ... 15
3.2.2 Support schemes ... 18
Cost of Solar PV and Wind systems ... 19
Wind power development ... 20
3.3 The Netherlands ... 21
3.3.1 Renewable Potential ... 21
3.3.2 Support Schemes ... 24
Support Scheme Development ... 24
Current Support Schemes ... 25
3.4 Sweden ... 26
3.4.1 Renewable Potential ... 26
3.4.2 Support Schemes ... 29
4. Grenoble ... 32
4.1 City introduction ... 32
4.2 Climate and Energy Goals ... 32
4.3 Energy Balance ... 33
4.4 Local actors ... 36
4.5 SESAC Projects ... 37
4.5.1 De Bonne ... 37
Eco-‐buildings ... 37
Mini CHP ... 38
Energy efficient school ... 38
Positive Energy Office Building ... 38
4.5.2 Refurbishment and retrofitting of buildings ... 39
4.5.3 Biomass District Heating in La Viscose (Echirolles) ... 39
4.5.4 Solar PV on La Metro Stadium ... 40
4.6 Potential for RES in 2020 ... 40
4.6.1 Wind ... 41
Technical Potential ... 43
Economic Potential ... 44
Urban wind turbines ... 45
4.6.2 Solar PV and Thermal ... 45
Solar PV ... 47
Individual houses ... 47
Collective houses ... 47
Industrial buildings ... 48
Summary ... 49
Solar Thermal ... 50
4.5.3 Hydro ... 52
4.5.4 Waste treatment ... 52
Current situation ... 52
Future potential ... 54
4.6 Results and discussion ... 55
5. Delft ... 56
5.1 City introduction ... 56
5.2 Climate and Energy goals ... 56
5.3 Energy Balance ... 56
5.4 Climate Plan/SESAC Projects ... 59
5.4.1 Wind turbines ... 59
5.4.2 Student dwellings and the Buitenhof Sports Centre ... 59
5.4.3 Händellaan Healthcare Centre ... 60
5.4.4 Eco-‐buildings in Poptahof ... 60
5.4.5 Harnaschpolder ... 60
5.4.6 Energy Advice in Student Housing ... 60
5.5 Potential for RES in 2020 ... 61
5.5.1 Areas of potential ... 61
5.5.2 District Heating Network ... 62
Individual houses ... 64
Collective houses ... 64
Industrial buildings ... 65
Summary ... 66
5.5.4 Urban wind turbines ... 67
5.4.4 Waste Treatment ... 69
Current situation ... 69
Future potential ... 70
5.5 Results and discussion ... 71
6. Växjö ... 72
6.1 City Introduction ... 72
6.2 Climate and Energy Goals ... 72
6.3 Energy Balance ... 72
6.4 SESAC Projects ... 76
6.4.1 Energy efficient buildings ... 76
Biskopshagen ... 76
Limnologen ... 76
Portvakten Norr ... 76
Portvakten Söder ... 76
6.4.2 Renewable Energy Production ... 77
Renewable Energy as a way of learning ... 77
District cooling ... 77
Biogas ... 77
6.5 Potential for RES in 2020 ... 77
6.5.1 Solar PV ... 77
6.4.2 Wind ... 79
6.4.3 Waste & Biogas ... 81
6.5 Results and Discussion ... 82
7. City comparisons and conclusions ... 84
7.1 City comparisons ... 84
7.2 Conclusions ... 85
7.2 Future research ... 85
References ... 86
Official publications ... 86Sesac reports ... 86
Literature ... 87
Mail correspondence ... 88
Software ... 89
Internet ... 89
Appendix ... 90
Appendix 1 – Wind Potential in Grenoble ... 90
Appendix 2 – Implementation map of Solar PV and Thermal in Grenoble ... 93
Appendix 3 – Housing situation in Grenoble ... 94
Individual Houses ... 95
Collective houses ... 96
Industrial buildings ... 97
Appendix 5 – Solar PV in Delft ... 99
Individual Houses ... 100
Collective Houses ... 101
Industrial Buildings ... 102
1. Introduction
This chapter introduces the subject of this thesis, presents the overlying project, gives the project description, presents the questions aimed to answer and gives an overview of the content of the thesis.
1.1 Sustainable cities
The concept of environmentally sustainable economic development was initially created as an action plan to fight environmental degradation caused by pollution and depletion of natural resources. Sustainable development is based on the simple idea of utilizing the eco-systems in such a way to achieve their renewal and evolution (Allen, 1980). Including economics in the picture, van den Bergh and Nijkamp (1991) define sustainability as those dynamics of economic activities, human perceptions and the population that ensure acceptable levels of welfare for every human by safeguarding the availability of natural resources and ecosystems.
The urban system, or city, is fueled by energy input, material input and biological elements. Then, the citizens of the city can choose how they treat those inputs, thus creating both desirable and non-desirable outcomes. Less non-desirable outcomes include pollution, creation of waste, traffic congestions, criminality etc. The eco-system of the urban system is seen in Figure 1.1.
Figure 1.1 Eco-system of the urban system (Kostas & Christofakis, 2006)
In order for the city to be sustainable, it must maintain a healthy biological functioning. This means ensuring the well being of crucial biological functions such as reproduction and evolution. The social and economic sustainability is much dependent on high accumulation of human factors as well as means of production, means of transport etc. The material composition plays a dominant role here. However, it is often this very material that leads to environmental unsustainability, therefore making it difficult for cities to simultaneously be environmentally and economically sustainable. (Kostas & Christofakis, 2006).
1.2 Information about the overlying project (SESAC)
energy studies. The project is EU funded with 10.4 million Euros, with a total budget of 25 million. (Concerto-Sesac.Eu, 2010).
The overall objective is to show how sustainable energy systems can be achieved by a combination of good governance, innovative co-operation and concrete measures.
In particular, the following measures will be demonstrated within the SESAC project (Concerto-Sesac.Eu, 2010):
§ a district heating system with low temperature waste heat,
§ design, construction and operation of (energy optimized) eco- buildings (35-40% lower energy use than national standards),
§ demand-side management, such as individual metering (and consumer initiated load control), § absorption cooling using RES district heating system (or thermal solar energy),
§ photovoltaic energy integrated in buildings.
1.3 Purpose and project description
The purpose of this essay is to look at the current energy balances of the three cities involved in the SESAC demonstration project (Grenoble, Delft and Växjö) and assess the physical, technical and economic potential of having an increased share of RES (Renewable Energy Sources) in the cities. The technologies evaluated are mainly solar (PV and thermal), wind (large scale and urban) and waste treatment (incineration and biogas production).
Furthermore, the thesis assesses which energy efficiency measures can be taken to further reduce energy consumption, and thus GHG (Green House Gas) emissions, in Grenoble, Delft and Växjö. The areas researched are predominantly housing, businesses and energy production and supply facilities. The industry sector is only evaluated briefly, and transportation is not included in the analysis.
Also, the different hinders and promoters affecting the future potential of higher share of RES are evaluated. This entails the different trading schemes (i.e. EU ETS, Feed-in Tariffs etc.) affecting implementation of RES, but also other institutional factors and incentives impacting the actors involved in making investments in energy efficiency and RES.
1.4 Questions
1. What are the current energy balances of Grenoble, Delft and Växjö and what are the future potentials for the energy balances regarding implementing an increased share of RES?
2. What historical efficiency measures have been taken in the three cities and what future efficiency measures and potential for reducing consumption are there?
3. What are the current GHG emissions of Grenoble, Delft and Växjö and what potential reductions of emissions are there?
4. What historic technical, economic, organizational and institutional hinders and promoters have there been in increasing the share of RES and what future hinders and promoters are there?
1.5 Limitations
Because of time and resource constraints some parts of the problems in the question formulations above are only evaluated briefly. For example, regarding the efficiency measures and consumption reduction no own analysis or calculations are made. Instead, information about historical and future projects is gathered from SESAC and other sources and the overall yield of those projects is written about.
Also, regarding future hinders and promoters very little own analysis and forecasts are made. Instead, available information is summarized and because of the fact that many of the support schemes etc. currently in action are so for a rather long time frame (often 2015-2030), the schemes already in place give a good estimate.
1.6 Method
Information and data regarding the SESAC project are collected through Internet searches on the official SESAC and Concerto websites as well as other media publishing information about the project and the cities involved. Furthermore, contacts are made with the energy agencies in the three cities to extract more detailed information on specific projects, both within the SESAC framework and other ongoing and future projects in the cities. There are also some internal WPs (Work Programs) to look at and extract information from.
Looking at the potential of the three cities, this will be done by using some of the information from the SESAC publications. As some projects within the SESAC framework are delayed and will not be finished in time, these measures will be seen as future potential. Contacts with the energy agencies in the cities have given information about land use, population, climate etc. in order to assess the future potential for RES.
Furthermore, when there is little or no information available about the city potential, information about the national potential is extracted and derived down to the city potential. Also, information about the general potential for each technology found in journal articles and other scientific publications will be assessed down to the city potential.
1.7 Content overview
Figure 1.2 shows how the content of this thesis is organized.
Figure 1.2 Content overview
First comes the introduction (this chapter). Then, the technical and economic theory behind this thesis is presented along with a macro description of the renewable potential and the support schemes of the countries in which the cities are located. Chapters 4-6 contain the description of the cities and their RES potential. Lastly, overall results and conclusions are presented along with comparisons of the cities in chapter 7.
1. Introduction
4. Grenoble
5. Delft
6. Växjö
7. City
comparisons
and conclusions
2. Theoretical
2. Theoretical Framework
Here, the underlying theories behind the thesis are presented in order to have a theoretical framework to base the rest of the report on, including basic theory about Energy Balances, Wind Power, Solar, Waste Treatment, Energy Efficiency as well as Economic Theory.
2.1 Energy Balances
The basic theoretical framework for this thesis is the energy balance of the three cities. More specifically, a Sankey diagram model is used for each city. An example of a Sankey diagram is shown in Figure 2.1.
Figure 2.1 Example of a Sankey diagram
In Figure 2.1, the Sankey diagram shows which Energy Sources are used to produce the energy needed to match the consumption of the Energy Users. In between them are the Energy Carriers used to transport the energy from the energy sources to the end users (typically through power lines (electricity) and district heating systems). In some cases the energy source is the same as the carrier, as with natural gas for example, where the natural gas is not used or converted until it reaches the end user. Not all energy users in the figure above are covered by this thesis; assessments and calculations will only be made on the residential and business sector.
As the focus of this thesis is to increase the share of RES in each city, not all parts of the energy balances will be closely examined. Mainly the supply side (Energy Sources) is covered by the calculations and evaluations made. How to decrease energy consumption and increase energy
efficiency (i.e. improve the Energy User side) is mentioned throughout the thesis. However, no own evaluations or calculations are made on this. Also, not all parts of the supply side are covered. Only the three RES of focus in the thesis: solar (PV and thermal), wind (large scale and urban) and waste treatment (incineration and biogas) are examined and the feasibility of increasing their share of the supply side is evaluated.
The reasoning for choosing those three RES is that they are among the technologies that have the largest future potential to increase RES in the cities energy systems. Other renewable sources such as biomass (Växjö and Grenoble) and hydro (Grenoble) have to a large extent already been exploited at a large scale in the cities, as they have existed for such a long time. For Delft, which does not have either wood or hydro resources at large scale, solar, wind (urban) and waste treatment technologies are essentially the main possible solutions to get locally produced renewable energy to the city. Also, especially solar and wind are rather new technologies that are yet to be exploited to their full potential, meaning that there is still much potential to build more solar and wind and it is likely that the prices of the technologies will decrease over time. Also, the technical progress within waste treatment with flue gas condensation to increase the energy production yield and ability to separate organic waste (renewable) from non-organic waste (non-renewable), as well as recycle a larger share, gives possibility to a more sustainable waste treatment.
Throughout the thesis, a table is used for each city to show the current state of the three RES evaluated and the resulting future potential. An example of this table is seen in Table 2.1.
Energy production Grenoble (2008) MWh % Electricity 1 054 646 Non-renewable 604 405 57% Renewable 450 241 43% - Solar PV 504 0% - Wind 0 0% - Waste treatment 24 044 5% Heat 6 957 219 Non-renewable 6 522 190 94% Renewable 435 029 6% - Solar Thermal 2 461 1% - Waste treatment 146 934 34%
Table 2.1 Current situation for Grenoble of the RES technologies evaluated in this thesis
Table 2.1 shows the current situation of the RES evaluated in this thesis. First, it shows the electricity
2.2 Renewable Energy Sources
2.2.1 Wind
Large scale wind power
The trend in the wind industry is towards larger wind turbines. A normal size of the turbines is today around 2-3 MW with a rotor diameter of 80-100 meters, which was considered huge just a couple of years ago (Hansson et al., 2007).
The production from wind turbines is, naturally, very dependent on good wind resources. Turbines normally produce electricity in the 3-25 m/s range. This is also true for the wind turbine used for calculations in this report, the Vestas V90-3.0 MW, as seen in Figure 2.2. Further, Table 2.2 shows the main specifications of the Vestas V90-3.0 MW.
Figure 2.2 Power curve of the Vestas V90-3.0 MW (Vestas, 2011)
Vestas V90-‐3.0 MW Value Unit Source
Rated power 3 MW (Vestas, 2011)
Hub Height 105 m (Vestas, 2011)
Cut-‐in wind speed 4 m/s (Vestas, 2011) Nominal wind speed 15 m/s (Vestas, 2011) Cut-‐out wind speed 25 m/s (Vestas, 2011)
Table 2.2 Specifications for the Vestas V90-3.0 MW wind turbine.
Urban Wind Turbines
Urban wind turbines (UWTs) (or small wind turbines) are defined by Cace et al. (2007) as turbines that are especially designed for the built environment and can be located on buildings or next to them. The capacity of these turbines is generally between 1 and 20 kW.
Because of where the urban wind turbines are placed, in urban areas with a lot of buildings and other obstacles interfering with the wind, they are exposed to lower Annual Mean Wind Speeds (AMWS) and more turbulent flow compared to turbines placed in rural areas. Low AMWS especially have made investors hesitant to invest in UWTs, as the economics of wind power naturally are very dependent on the available wind resource. Turbulent wind flows also present challenges due to the rapidly changing wind conditions, which put extra stress on the turbine blades and limits energy production (due to the fact that the turbines usually cannot react quickly enough to utilize the changes). Most promising placement areas with respect to turbulence and AMWS include building tops (good AMWS) and school playing fields (little turbulence). (Wineur, 2005).
There are two main types of urban wind turbines, the Horizontal Axis Wind Turbine (HAWT) and the Vertical Axis Wind Turbine (VAWT). On the HAWTs the propeller-rotor is mounted on a horizontal axis, and on the VAWT it is mounted vertically. For examples of HAWTs and VAWTs, see Figure
2.3.
Figure 2.3 Example of a HAWT (on the left) and a VAWT (on the right) (Cace et al., 2007).
HAWTs are sensitive to changes in wind direction and turbulence, which have a negative effect on performance due to the required repositioning of the turbine into the wind flow (Cace et al., 2007). However, they are also more efficient and economic than VAWTs (Wineur, 2005). Best locations for HAWTs are open areas with smooth airflow and few obstacles.
VAWTs are typically developed only for the urban environment. They do not need to be repositioned according to the wind direction. Overall efficiency is, however, lower than for HAWTs. There are two types of VAWTs, the Savonius and the Darrieus. In the Savonius design, the wind pushes the blades, implying that the rotation speed is always lower than the wind speed. The Darrieus design, however, makes it possible for the rotor to spin faster than the wind speed. (Cace et al., 2007).
Table 2.3 Rated wind speed of European UWTs (Wineur, 2005).
Rated wind speed is the speed at which the turbine reaches it rated power output. Reaching the rated power at a lower wind speed is of course beneficial as the turbine then can produce at its rated output a larger fraction of the time.
Table 2.4 Cut-in wind speed of UWTs (Wineur, 2005).
Cut-in wind speed is the wind speed at which the turbine starts operating and producing power. As with rated wind speed, the lower speed at which it starts producing, the better.
Table 2.5 Cut-out wind speed of UWTs (Wineur, 2005).
Cut-out wind speed is the wind speed at which the turbine shuts down and stops producing to protect the rotor blades and other components from failure. As seen in Table 2.5 most UWTs analyzed by Wineur cut out at a very high wind speed (over 20 m/s) or not at all.
Table 2.6 Noise levels of UWTs researched in the Wineur (2005) report.
Life expectancy of the UWTs is generally stated at 20-25 years and around 120 000 hours of operation. Maintenance needs are fairly low for the turbines. 40 % of the manufacturers in the Wineur report stated that no maintenance was needed, although the bearings need lubrication once or twice a year.
2.2.2 Solar
Solar PV
Solar PV cells are constructed from a semi-conductor material and works by absorbing sunlight. As the sun hits the front of the photovoltaic cells they get negatively charged at the same time as the back gets positively charged. The resulting voltage drives the electrons in a destined directions and direct current (DC) is created (Larsson & Ståhl, 2009).
Solar cells have evolved quite a bit in the last couple of years. The first generation of solar cells was the crystalline cells. Now the second generation, the thin film cells, has started emerging more and more, with the manufacturing quadrupling between 2007-2009 and today making up around 13 % of the total market (Larsson & Ståhl, 2009). The emerging popularity of the thin film cells is much due to its lower costs, lighter weight and ease of integration. However, the largest difference between the crystalline and the thin film cells is the efficiency, where the first generation is more efficient at between 11-15 % (Carlstedt et al., 2006), whereas the thin film cells generally has en efficiency of 7-11 % (Solarit, 2009). For the purpose of this thesis, an efficiency of between 7-11-13 % is assumed. The costs of solar cells are partially dependent on the size of the installation. This thesis assumes a cost of 4,5 €/W for installations up to 10 kW and 6,5 €/W thereafter (Campoccia et al., 2009). As all solar PV installations in this thesis are assumed to be BIPV (Building Integrated PV), incomes from the solar electricity production are generated in the form of diverted costs of electricity. As the price of electricity differs depending on country the income per kWh produced also differs depending on city (i.e. Grenoble, Delft & Växjö). The other source of income, the FIT, is also country dependent. Solar Thermal
Solar thermal can be used for a number of purposes, such as producing domestic heating, hot water or electricity (often combined with a stirling engine). The usages evaluated in this thesis are heating and hot water.
When using solar thermal for domestic heating a space heater collects the suns energy by a solar collector and directs the energy into a “thermal mass” for storage later when the space is the coldest. The thermal mass can consist of a masonry wall, floor or any other type of storage drum. The space heating system can be combined with a hot water heating system. (Musunuri et al., 2007).
exchanger transfers the heat to the water. The passive solar system is better suited for hotter climates, as it relies on the sun naturally transferring the heated water. (Musunuri et al., 2007).
Solar thermal is only evaluated for Grenoble in this report, as it is the only city of the three that has a hot enough climate for it to be a large-scale, viable heating solution. Further, it is mostly evaluated in the sense of what payback time and economic feasibility it has when replacing different sorts of existing heating solutions.
2.2.3 Waste treatment
There are many ways to treat waste. First priority is to reuse the waste, leading to recycling. There are several ways to recycle. Either the material itself can be recycled, as with for example plastic and glass, so that new products of the same material can be manufactured. This is done by what is called material recycling. The other alternative is to recycle the energy within the material. This is made possible using biological treatment methods such as composting or digestion and waste incineration. Last resort is landfill, where gases from the waste can be used for energy extraction.
Biological treatment
The organic fraction of the waste is usually between 40-50% of the total waste. The alternatives for the organic fraction include digestion and composting. Both methods place demands on the material going in, meaning that the collection system must be adapted to the end-treatment method. Composting demands water content of 40-60 %, whereas digestion needs 65-80% to work. Organic household waste can contain up to 80% water, which means that “open systems” where some evaporation can occur is better suited for composting while “closed systems” without evaporation suits digestion better. (Erdogan, 2007).
The digestion method can be used for both organic waste and sludge. In this method bacteria and other microorganisms break down the organic material, so that energy is released in the form of biogas (Erdogan, 2007).
Composting is nature’s own way of breaking down organic waste, using oxygen and microorganisms, mostly bacteria and sponges. Heat is developed in the processes of composting, at around 60-70 degrees at most (Erdogan, 2007).
Negative effects of biological treatment are NOx and methane emissions. Ammonia is also emitted, contributing to eutrophication and acidification. Another result, mainly from composting, is leachate which, if emitted can create eutrophication and odor. The leftovers from composting and digestion can be used as manure, soil products etc. Biogas extracted can be upgraded to transportation fuel or be used in energy production. (Erdogan, 2007).
Waste incineration
possible by condensing the water vapor of the flue gas. Efficiency can go up by as much as 30 % without increasing the fuel consumption. (Erdogan, 2007).
Landfill
When there is no other way of treating the waste, it is put on landfills. More stringent demands in some countries (e.g. Sweden) has led to that the amount of waste put on landfills has decreased drastically during the last ten years. However, in some countries this share is still sizeable (at 25-40 % for the Netherlands and France). Landfill gases produced from the landfill can be used for heat and electricity production. Often the gas is torched. (Erdogan, 2007).
Biggest downside with landfills is the leachate produced. Ideally it should be transferred to municipal sewage treatment plants or be treated on site (Erdogan, 2007).
Potential Energy production
The biggest potential in extracting energy from waste treatment is through incineration and digestion. As there are many different methods of doing so, and the incineration plants can have a variety of incineration techniques (flue gas condensation or regular incineration) Table 2.7 presents the energy potential from the different techniques (Erdogan, 2007).
Type of waste Treatment MWh/ton
Unsorted household waste Incineration with flue gas condensation 3.35 Unsorted household waste Incineration without flue gas condensation 2.25 Non-‐organic waste Incineration without flue gas condensation 3.75 Organic waste Digestion (Biogas production) 0.972
Table 2.7 Energy production capacity depending on waste treatment method (Erdogan, 2007).
2.3 Energy Efficiency
Energy efficiency plays a crucial part in cities decreasing their energy consumption and lowering their CO2 emissions. Both on the supply and demand side there is a lot to be done. The supply side can be improved by increasing the efficiency of the energy production facilities, as for example with waste treatment in implementing flue gas condensation and turning heat production plants into CHP (Combined Heat and Power) plants using turbines.
On the demand side, more specifically the commercial and residential buildings as well as industry (which are the only demand side sectors covered in this thesis), energy efficiency is mostly about decreasing consumption as well as making the buildings and the energy consumers within them (lamps, utilities etc.) more energy efficient. This can, for example, be done by increasing the insulation, using energy efficient lamps and appliances and implementing individual metering so that the residents become aware of their consumption.
2.4 Economic theory
The method used to measure the economic feasibility of investing in RES in this report is the NPV (Net Present Value) method. It is defined as the sum of the present values of all project cash flows (Berk & DeMarzo, 2010) , as seen in equation (1)
!"# = !"(!"" !"#$%&' !"#ℎ !"#$%) (1) The present value of each cash flow is calculated using equation (2) (Berk & DeMarzo, 2010)
!" = !
(!!!)! (2)
Where ! is the cash flow, ! is the competitive market interest rate and ! is the period in which the cash flow appears. The fraction (1 + !)! represents the discount rate, i.e. the rate each cash flow is discounted by.
The specific equation used for calculating cash flows for wind and solar investments in this report is seen in equation (3) (Campoccia, 2009)
!! = !!∙ !!+ !!"!,! ∙ !!− ! ∙ !! (3)
Where !! is the cash flow in the !th year, !! the FIT (Feed In Tariff) in the !th year, !! the electricity production the !th year, !!"!,! the electricity price the !th year, ! an O&M (Operation and Maintenance) coefficient and !! the initial investment cost.
After the cash flows for each year have been calculated and discounted, the sum of these (i.e. the NPV) and the initial investment can be used to calculate the IRR (Internal Rate of Return) of the investment, using equation (4)
3. Country Level
In this chapter, each of the overlying countries of France, The Netherlands and Sweden are presented in terms of their current energy usage and emissions as well as their future potential for RES. This is needed because information about the national potential tells a lot about what potential for RES each city can have. Also, the support schemes for each country are implemented on a national level, therefore also affecting the feasibility of RES investments at the city level. At the end of the chapter comparisons between the countries in terms of their RES potential and support schemes are presented.
3.1 The EU-wide ETS
The EU ETS (European Emissions Trading Scheme) was launched in 2005 and includes 11 500 installations, or about 45% of EU’s total CO2 emissions. Installations include incineration plants, oil refineries, iron and steel mills and factories with large emissions. All 27 member states of the EU are included in the scheme. (Egenhofer, 2007; Energimyndigheten, 2009).
The idea of the EU ETS is that emission heavy actors must monitor and report their CO2 emissions at a yearly basis. The emission rights that are traded are called EUAs (EU Emission Allowances), where one EUA corresponds to the right of emitting one ton of CO2. At the end of the year the companies that are included in the EU ETS must return EUAs corresponding to the amount of CO2 they have emitted. If they fail to do so, i.e. have emitted more CO2 than they have allowances for, they have to fine a sum of (at present) 100 €/ton CO2. In order to account for yearly irregularities that might occur EUAs are however supplied for a trading period of a number of years. (Kierkegaard, 2007).
In the first phase that lasted between 2005-2007 the EUAs were more or less allocated freely, without charge. As much as 95 % of the EUAs were allocated in this way (Egenhofer, 2007). A large reason for choosing this strategy was to receive the acceptance of the industry. However, the allocation encountered a number of issues at the first allocation period. Main concern was over-allocation, i.e. members were given more EUAs then they emitted. In fact, 5% of the EUAs that were allocated didn’t have any emissions to match. This led to that price of EUAs went down considerably towards the end of phase 1, from 30 €/ton to 1€/ton in May 2006 and approaching the end of 2007 the price was close to zero (Egenhofer, 2007; Zhang & Wei, 2010). However, over-allocation was not the only reason the price of the EUAs went down. Rights to emit in phase 1 weren’t transferable so that these could be used to match emissions occurring in the next phase (Parsons et al., 2009). Therefore, the price decrease in the end of phase 1 was natural.
In phase 2, lasting between 2008-2012, the basis for the allocation is the actual measured emissions in 2005 instead of approximations, giving a more accurate allocation rate. Allocations are down 9% compared to phase 1 (Egenhofer, 2007; Energimyndigheten, 2009). In the first half of 2008, the price of an EUA was slightly above 30€. However, partly due to the financial crisis, in Q1 2009 the price was under 10€, but in second and third quarter the price was stabilized at around 15€ (Energimyndigheten, 2009).
3.2 France
3.2.1 Renewable Potential
According to the E.U targets, France must reach a 23% share of renewable energy in its energy consumption by 2020. As a part of reaching this target a “renewable energy sources” operating committee started a think tank called “Grenelle”. The committee found that there were a number of holdbacks needed to be tackled in order to reach the targets and issued a number of recommendations as how to overcome these obstacles. (REPAP, 2010a).
The total energy usage in France was 160 million tons of oil equivalent (Mtoe) in 2008, the division of which is seen in Figure 3.1 (REPAP, 2010a). Please note the conversion rate 1 Mtoe = 11,63 TWh to get the figures in Figure 3.1, 3.2, 3.3 and Table 3.2 into TWh.
Figure 3.1 Division of energy consumption in France in 2008, totaling 160 Mtoe (REPAP, 2010a).
The supply to cover that consumption came from the sources in Figure 3.2.
Figure 3.2 Energy supply division in France in 2008, totaling 160 Mtoe (REPAP, 2010a).
Figure 3.3 Renewable energy sources in France in 2008, totaling 16 Mtoe (REPAP, 2010a).
As Figure 3.3 shows, the main contributors of renewable energy in France are wood (46 %), hydro (29%), biofuels (11%) and renewable waste (6%). Wind and solar PV only make up small fractions at 3% and 1 % respectively.
Future targets for wind and solar, however, are very ambitious and a high growth rate is expected, as seen in Table 3.1.
RES potential 2008 2020 objectives
Wind 3404 MW 25 000 MW Solar PV 157 MW 5400 MW Solar Thermal 1 600 000 m2 18 000 000 m2
Table 3.1 Solar and wind production capacity in France in 2008 and 2020 objectives (REPAP,
2010a).
Table 3.2 Renewable energy objectives for France in 2020 divided by RES (REPAP, 2010a). Note: 1
Mtoe = 11,63 TWh.
It is evident looking at Table 3.2 that most of the renewable heating will come from biomass and waste in 2020 (83 %), and only a small proportion from solar thermal and geothermal. Regarding electricity, hydro is still forecasted being the largest contributor of renewable electricity, but with very little growth from the situation today. Almost all the growth in renewable electricity stems from wind power (and partially biomass), with 6000 additional turbines and an almost 5 Mtoe increase in electricity production compared to 2006. Solar PV also increases from a virtually miniscule level, but the electricity production forecasted at 0,4 Mtoe in 2020 is small compared to the wind power.
Furthermore, there is a project called the “Project of Energy Orientation Law” aiming at reducing the dependence of French economy on oil, reducing GHG emissions by 75 % by 2050 (on average 3%/year) and guaranteeing a competitive price of energy. This is made possible by (Champvillard et al., 2005):
§ Boosting nuclear energy (although not renewable)
§ Reducing energy consumption by an annual rate of 2% till 2015, and then 2.5 % annually till 2030. Tools for doing so include a cap and trade system, intensification of technical norms in buildings, and increased use of biofuels.
Technology
Cost (EUR ct/kWh) Wind onshore >7m/s 5.91 Municipal solid waste 6.38 Power station -‐ solid wastes agricultural 6.91 Wind onshore 6-‐7m/s 7.22
Sewage sludge 7.33
Small Hydro (<10 MW) low investments 7.44 Wind onshore 5-‐6 m/s 9.83 Power station -‐ solid wastes industrial 10.10 Municipal solid waste decentr. 10.10 Sewage sludge decentr. 11.19 Small Hydro (<10 MW) medium investments 12.01 Wind onshore 4-‐5 m/s 13.37 Large Hydro (>10 MW) medium investments 14.53 Geothermal electricity low investments 14.57 Photovoltaics high radiation 20.13 Photovoltaics medium radiation 24.42 Photovoltaics low radiation 29.10
Table 3.3 Cost of different RES in France (REBUS, 2001).
In line with the highest RES growth forecasted in France, wind power is also one of the cheaper technologies. Waste is also a relatively low cost alternative, whereas hydro, geothermal and solar PV are among the more expensive alternatives.
3.2.2 Support schemes
The support mechanism adopted for PV and Wind systems in France is the Feed-In Tariff (FIT) mechanism. The FITs for wind differ depending on if it is on-shore or off-shore and also dependent on the rated power. FITs for PV are composed by a basic tariff, for not integrated PV systems (NIPV) and a bonus in the case of building integrated PV systems (BIPV). Other incentives also exist for PV, such as a tax credit for individuals (50 % of material costs), a reduced VAT of 5.5 % (if the equipped building is more than two years old) and accelerated investment depreciation for companies (Campoccia et al., 2009). The FIT for 2007 can be seen in Table 3.4.
Kind of installation FIT (€/kWh)
PV Systems
NIPV system (in-land departments) 0.300 NIPV system (overseas departments) 0.400 Bonus for BIPV (in-land departments) 0.250 Bonus for BIPV (overseas departments) 0.150
Wind Systems
On-shore - first 10 years 0.082
On-shore - following 5 years 0.028 or 0.082
Off-shore - first 5 years 0.13
Table 3.4 FIT for Wind and PV systems in France in 2007 (Campoccia et al., 2009).
As seen in Table 3.4 a FIT of 0.082 €/kWh is given the first 10 years for wind onshore. After that the FIT is 0.028 or 0.082. This means that the FIT is differentiated depending on the full load operating hours of the wind farm. If it is operational at full load for 3600 hours/year or more, a support of 0.028 €/kWh is given. If that figure is 2400 hours/year or less, however, a FIT of 0.082 €/kWh is given. (Rathman et al., 2009).
Cost of Solar PV and Wind systems
In a study made by Campoccia et al. they compare the cost of installing a number of PV (3kWp BIPV, 20 kWp BIPV and 500 kWp NIPV) and wind systems (20 kW micro-wind turbine, 20 MW on-shore wind farm, 50 MW off-shore wind farm) in France, Germany, Italy and Spain. The following data were used for France (installation costs excl. VAT):
French PV data
Installation cost (≤10kWp) 6.5 €/W Installation cost (>10kWp) 4.5 €/W Electricity produced yearly 1100 kWh/kWp Cost of Electricity 0.119 €/kWh
Inflation rate 2.2 %
WACC 3 %
Table 3.5 French PV data (Campoccia et al., 2009).
The data Campoccia et al. used for the Wind systems can be seen in Table 3.6.
French Wind data
Cost 20 kW Micro-Wind turbine 2200 €/kW Cost 20 MW On-shore wind farm 1000 €/kW Cost 50 MW Off-shore wind farm 2000 €/kW Equivalent hours produced (on-shore) 1400 hours/year Equivalent hours produced (off-shore) 3000 hours/year
Table 3.6 French Wind data (Campoccia et al., 2009).
Using the data presented in Tables 3.5 and 3.6, the following results are presented by Campoccia et al.
Rated power PBP (years)
IRR (%) NPV (k€) PV Systems 3 (BIPV) 14.5 2.62 5 20 (BIPV) 9 8.68 86 500 (NIPV) - - - Wind systems 20 - - - 20,000 (on-shore) 15 2.15 4,574 50,000 (off-shore) 6.5 14.88 202,422
Table 3.7 Resulting PBP, IRR and NPV of PV and Wind system investments (Campoccia et al.,
The cells in which there are no numbers represent results where the PBP is more than 25 years, i.e. not feasible. Campoccia et al. conclude that the FIT in France regarding big, NIPV solar is only really advantageous when the rated power is below 100 kWp. The support for smaller-sized BIPV and NIPV systems are, however, better. Results in Table 3.7 also show that the support in France for off-shore wind farms is better than on-shore. This is due to lower feed-in tariffs for on-shore than off-shore as well as lower equivalent hours produced for the on-shore case.
Wind power development
France has had one of the highest feed-in tariffs for the last seven years, but yet the installed capacity of wind power is very low (1.8 GW) compared to other European countries that have had the same type of tariffs. One of the reasons for this is institutional lock-in into nuclear energy. Another reason is the administrative landscape protection has been diffuse, affecting the construction of wind farms. About 20 % of wind power applications were denied construction permits in 2005, varying from 0-50% depending on the region. Civil society has strongly opposed wind power, especially in tourist and secondary residence areas or in places where landscape is particularly valued. Rhone Alpes, the area in which Grenoble is situated, is one of these areas. (Nadai & Labussiere, 2009).
One of the things also affecting wind power development is landscape culture, i.e. the way in which landscape is traditionally accounted for by lay persons, landscape protection organizations and local/national administration. The large visual impact wind turbines have is rarely compatible with the look of the current landscape. According to Nadai & Labussiere (2009) there are three routes planners and policy makers can take. Route 1 is accepting a limited development of wind power. The second is to approach the administrative hierarchy and try to impose quantitative targets on local and regional authorities. The third route is to approach wind power issues as an occasion to reconsider the rules governing landscape variation. This means allowing to create “wind power landscapes”. For wind power to make a significant contribution as an alternative energy source, it is advisable not to fit turbines in existing landscapes, but to set up processes where new landscape representations can arise with wind power development and make them sustainable.
In France, at a national level, it seems like route 1 has been taken in implicitly accommodating itself to the slow pace of wind power development. At a local level, however, decision makers did their best to regulate developments of wind power. This was done by hierarchy imposing conformity with existing landscape protection regulations (route 2) and open processes looking for ways defining new compatibilities between landscapes and wind power (route 3). Only recently a national framework has been implemented at a national level with Wind Power Development Zones (WPDZ). The WPDZ might foster bottom-up planning and decentralization. They were implemented in 2007, providing local actors with an opportunity to enter the planning process and innovate the approach to wind power landscapes. Success depends on the collaboration between local state representatives and other local actors in designing the WPDZs, according to Nadai & Labussiere.
Impact studies of how the wind power affect the landscape are processed by the French Ministry for the Environment in France (DIREN). The impact is simulated through sketches, cross-sections and photomontages presenting views before and after turbine construction. An increased decentralization of wind power development and an increasing number of permits for processing has forced the DIREN to rely on material provided by developers. (Nadai & Labussiere, 2009).
economic motive to co-ordinate and plan wind power at a relevant scale. Also, town councilors are becoming key actors in wind power planning in France, as they are both the recipients of wind power benefits (through the wind power tax) and the steering agency for WPDZ development. (Nadai & Labussiere, 2009).
3.3 The Netherlands
3.3.1 Renewable Potential
The Dutch policy goal (formulated in 1996) is to achieve a share of 17% renewable electricity (RE) in the domestic demand by 2020, corresponding to 18-24 TWh. Table 3.8 shows historical primary energy consumption from renewables and future goals derived from the policy.
Renewable Realization and Goals for the
Netherlands
Actual realization [TWh] 1996 Policy Goals [TWh]
1995 2000 2000 2020 Wind Onshore 1 2 4 13 Solar-‐PV 0,003 0,02 0,28 3 Solar-‐Thermal 0,06 0,11 1 3 Geothermal -‐ -‐ -‐ 1 Heat storage 0,02 0,14 1 4 Heat pumps 0,06 0,17 2 18
Domestic hydro power 0,19 0,33 0,28 1
Energy from waste incineration (organic
fraction only) 2 3 6 13
Biomass 4 5 9 21
Hydro power import -‐ -‐ -‐ 5
Total 6,27 10,41 23 80
Table 3.8 Historical energy consumption from renewables and future potential according to the 1996
policy. (Agterbosch et al., 2004).
A number of studies have been made on the possibilities of individual RE options in the Netherlands. Agterbosch et al. compare the DEN, RACE, DENL and REBUS studies:
§ The DEN study is an analysis of the possible developments for the Dutch energy system until 2020. Two scenarios are distinguished.
§ The RACE study analyses the costs and the potential of different renewable options for 2020 and beyond. It also focuses on two different scenarios, “only renewable” and “general environmentally sustainable”.
§ The DENL study looks at the development of renewable energy until 2020 given the policies of 1999, presenting three scenarios (low estimate, best guess and high estimate).
§ The REBUS report demonstrates the effects of different European tradable green certificate systems for the year 2010 on the renewable electricity market in Europe (including the Netherlands). It also includes long-term energy potentials per country.
reflects an environment with strong governmental support for renewables, whereas the higher ones represent a highly competitive liberalized environment.
All studies assume that the cost of RE is going to decline until 2020, the DEN, REBUS and RACE studies assuming a fixed reduction of costs, e.g. 20% lower investment costs in 2020 compared to current costs. The DENL study, however, uses a different approach. It uses the experience curve concept, in which the cost reduction depends on the cumulative production of a technology. With every doubling of the capacity, the costs are reduced with a fixed amount. DENL is also the only study identifying possible bottlenecks for offshore wind and PV development. For wind it could be the number of days, on which turbines can be installed and for PV the growth in global production capacity and the maximum Dutch market share may be a limiting factor. (Agterbosch et al, 2004). Most of the studies conclude that in prosperous circumstances, the policy goal of 17-24 TWh may be reached. In the “best guess” or “trend” scenarios, however, this target is not accomplished. Figure 3.4 shows the results of the different studies on possible realization. Economic viability plays a vital role for the projected diffusion of RE technologies in all studies but RACE. Despite this, none of the studies evaluate the effects of different IRR on the outcome.
Figure 3.4 Realization possibility of RE according to the DEN, DENL, REBUS and RACE study
(Agterbosch et al, 2004).
After having reviewed the four studies, Agterbosch et al. set up three images of their own of the potential for RE in the Netherlands in 2020. At first, three factors being economic viability, maximum implementation speed and ecological sustainability are used as basic settings for making the three images. Governmental financial support and technological progress are two other factors influencing the economic viability and the maximum technical implementation rate in all images. Social and institutional settings are not taken into account in the images of Agterbosch et al.
In image 2 all possible RE options are fully exploited, mainly limited by the maximum technical implementation speed. The technology with the highest efficiency and largest CO2 emissions reduction is selected, largely disregarding costs and other environmental/social criteria. Driving forces in doing so can be the diversification of domestic fuel supply, e.g. to reduce the dependency on oil and natural gas. Maximum technical implementation rates are assumed, determined by using numbers from literature and extrapolating current growth trends. A required IRR of 8% is assumed. (Agterbosch et al, 2004).
Image 3 suggests that although global warming is still a major problem, other environmental problems such as land-use, airborne-emissions, biodiversity etc. also become essential policy priorities. Governmental policies could include high investment subsidies, feed-in tariffs for selected technologies and tax deductions for green investments. This is all incorporated in the IRR of 5%. (Agterbosch et al, 2004).
Regarding wind onshore, the technical potential could easily be reached until 2020, according to Agterbosch et al. The economic viability is also rather good as the production costs are expected to end up between 4 and 7 ct/kWh at inland locations and at top coast locations 3-3.5 ct/kWh. This makes wind a relatively attractive economic option in all three images. (Agterbosch et al, 2004).
Technical PV potential includes 115-430 km2 of suitable roof surface and 220 km2 of degraded
agricultural land. In images 2 and 3, the major constraint is the maximum rate with which PV systems can be produced and installed. According to Agterbosch et al. calculations, the technically available capacity will be at least ten times smaller than the environmental potential in 2020. In image 1 the cost of PV is the biggest bottleneck, which varies from 20-30 ct/kWh in 2020, therefore not realizing it at all in that image.
Agterbosch et al. do not regard biomass feasible due to relatively high costs in image 1. In images 2 and 3 an annual production of about 1 million ton cultivated biomass dry matter was assumed based on 100,000 ha and an average yield of 10 tons (dry)/ha.
Technical potential for hydropower in the Netherlands is small, about 100 MW. Agterbosch et al. estimate the economic potential at 53 MW, 15 MW more than the capacity currently installed.
Figure 3.5 Renewable Electricity potential in the three images derived by Agterbosch et al. (2004).
exploited. Near-shore wind parks are permitted. Hydropower is exploited up to its economic potential. PV gets no subsidies and has negligible diffusion. In total, image 1 results in 25 TWh potential before the 9 ct/kWh boundary is reached.
Image 2 exploits on-shore, off-shore and near-shore wind fully, made possible by favorable legislation for RE projects. Waste separation and conversion of biomass waste streams with co-firing in existing NG-plants is used on a large scale. PV is strongly stimulated, with the maximum penetration rate being the limiting factor. Resulting maximum production is 43.6 TWh.
Image 3 has more limited deployment of on-shore wind, as the public perception is that wind should be realized far from shore where societal and environmental impact is limited. Biomass use is limited to clean streams, such as cultivated crops in the Netherlands and clean biomass residues. PV is strongly stimulated for both large scale and small-scale projects, with maximum penetration rate being the limiting factor.
Agterbosch et al. conclude that wind offshore is a robust option, as it has a significant share in all three images. The largest uncertainties are the successful technological development and the maximum installation rate until 2020. Regarding on-shore wind, environmental criteria and available space are the limiting parameters. However, it is still an important and relatively robust option in all three images.
When it comes to biomass, two different technologies are evident: different forms of co-firing as the economic option and large scale gasification plants as the most efficient technology. Large scale co-firing contributes substantially to the renewable electricity production. Successful development of the technologies and quantity and sustainable character of various biomass streams may be bottlenecks for exploiting the full potential. (Agterbosch et al., 2004).
Regarding PV, costs and maximum implementation rate are bottlenecks. It therefore does not contribute a large share in images 1 and 2. In image 3, it can contribute up to 7 % of total supply. Hydropower is limited by technical potential and contributes at most 0.3 % in image 3.
In all three images, the policy’s upper goal of 24 TWh is reached, meaning that economic demands alone are not enough as a boundary of reaching the 17 % goal of RE. When calculating restrictively, in each of the chosen images off-shore wind supplies at least 10.3 TWh, on-shore wind 4.8 TWh and large-scale biomass 6.5 TWh, adding up to a robust potential of 21.6 TWh. However, the locations of the wind turbines differ as well as the technologies used for biomass in the three images. Taking this into account, only calculating with the locations being the same in all three images, only 9 TWh of minimum production remains. (Agterbosch et al., 2004).
3.3.2 Support Schemes
Support Scheme Development
Looking at a national (Dutch) level, many support systems for renewable electricity (RE) have existed. Several different definitions of what is to include as RE and the fact that a high number of policies were adopted and implemented contemporaneously has also increased the complexity. (Agnolucci, 2007).
capacity costs was fixed by the legislation. A distinguishment was made between intermittent (e.g. wind power and PV) and non-intermittent generators (e.g. biomass) was made. Intermittent generators received about 70 % of the cost paid to non-intermittent generators. (Agnolucci, 2007).
In 1995, a green funding program was introduced. In the program 60 % of the interest from the investments were tax free, which made it possible for banks to lend at a discounted rate (ca 1 point lower than the market one) to developers building green projects. Electricity from wood, wind, PV and hydropower was supported. Public funding was about 11 million Euros. (Agnolucci, 2007).
An environmental action plan was made in 1997 called MAP 2000 with a budget of 50 million Euros from 1997-2000. This included a program for wind launched in 1997 decreasing both investment and R&D incentives. A PV program was also launched focusing on investment and production incentives. Biomass and waste was also included, with a budget of 5.4 million in 1997-2000.
A tax on energy consumption called the regulating energy tax, REB, was introduced in 1996. All electricity was subject to the levy except RE generated or imported into the Netherlands, which received a “Production Subsidy”. Technologies eligible for the incentives were wind, solar, small hydropower, biomass and biogas. Hydro was excluded in 2002. In 1998 a Zero Rate was introduced for RE on the condition that it was passed on to the consumers with a “green electricity” contract. It meant that RE generated and imported to Netherlands could receive both the production subsidy and the REB zero rate. (Agnolucci, 2007).
In 2001, the green certificates system (GCS) was introduced by law. Green certificates were given to generators for the net amount of electricity delivered to the grid. By the time of the introduction, only electricity produced in the Netherlands from small hydropower (<15 MW), wind turbines, PV and biomass were eligible. Imported electricity was included in the scheme in January 2002 on the condition that it had not received any prior public support. (Agnolucci, 2007).
The policy changed in 2002, introducing a new feed-in tariff and reducing the REB zero rate and abolishing the production subsidy. At introduction, the law fixed a minimum level of total support for a period of ten years. Only electricity produced in the Netherlands was eligible for the tariff. Later on, starting 2005, the REB zero rate was abolished and RE was taxed at the same rate as fossil fuels. (Agnolucci, 2007).
The introduction of the feed-in tariff with a fixed minimum amount of revenues for the next ten years decreased the regulatory risk for the Dutch generators. They were, however, still faced with a high market risk, as imports were still eligible for the REB zero rate. The share of incentive paid to generators was determined by the price of the green certificates that in turn were decided by the demand for, and supply of RE. Because of the import of green electricity, the price of the green certificates was as low as 0.6 Euro cent/kWh. Furthermore, given the rates at the introduction of the feed-in tariff, it seems that the government was more concerned about domestic capacity rather than green electricity demand. The abolition of the REB zero rate has additionally removed the fiscal privileges previously enjoyed by green electricity. (Agnolucci, 2007).
Agnolucci states that many analysts claim that the Dutch support system for RE has been hard to understand, confusing and lacking long-term security due to the frequent changes and numerous instruments.
Current Support Schemes
