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European Commission approves 3 support measures for renewable energy in Denmark

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The European Commission has approved under EU State aid rules three schemes to support electricity production from wind and solar in Denmark in 2018 and 2019.

Denmark has a goal of supplying 50% of its energy consumption from renewable energy sources by 2030 and to become independent from fossil fuels by 2050. In line with this goal, the Danish authorities will implement three measures supporting renewable energy:

  • A multi-technology tender scheme for onshore and offshore wind turbines and solar installations, with a budget of DKK 842 million (€112 million). The beneficiaries of the aid will be selected through two tenders organised in 2018 and 2019, with the different technologies competing with each other. The selected installations will offer their electricity on the market and receive support in the form of a premium on top of the market price (top-up payment).
  • An aid scheme for onshore wind for test and demonstration projects outside the two national test centres for large wind turbines, with an expected budget of DKK 200 million (€27 million), and a transitional aid scheme for onshore wind, with a budget of DKK 40 million (€5 million).

The aid for the three schemes will be granted for a period of 20 years from the time of the connection to the grid. The renewable support schemes are financed from the State budget.

The Commission assessed all three schemes under EU State aid rules, in particular the Commission’s 2014 Guidelines on State Aid for Environmental Protection and Energy. It found that the three Danish schemes will encourage the development of offshore and onshore wind and solar technologies, in line with the requirements of the Guidelines.

On this basis, the Commission concluded that the measures will help Denmark boost the share of electricity produced from renewable energy sources, in line with the environmental objectives of the EU, while any distortion of competition caused by the state support is minimised.

Background

The Commission’s 2014 Guidelines on State Aid for Environmental Protection and Energy allow Member States to support the production of electricity from renewable energy sources, subject to certain conditions. These rules are aimed at meeting the EU’s ambitious energy and climate targets at the least possible cost for taxpayers and without undue distortions of competition in the Single Market.

The Renewable Energy Directive established targets for all Member States’ shares of renewable energy sources in gross final energy consumption by 2020. For Denmark, that target is 30% by 2020. Furthermore, Denmark has a goal of supplying 50% of its energy consumption from renewable energy sources by 2030 and to become independent from fossil fuels by 2050. All three schemes aim to contribute to reaching those targets.

More information on today’s decision will be available, once potential confidentiality issues have been resolved, in the State aid register on the Commission’s competition website under the case numbers SA.49918, SA.50715 and SA.50717. The State Aid Weekly e-News lists new publications of State aid decisions on the internet and in the EU Official Journal.

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IRENA and UN agree to jointly combat desertification through renewables

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photo: IRENA

The International Renewable Energy Agency (IRENA) and the Secretariat of the United Nations Convention to Combat Desertification (UNCCD) are joining forces to support climate adaptation and resilience and to implement UN Sustainable Development Goals through renewables.

In a Memorandum of Understanding signed today by IRENA’s Director-General Francesco La Camera and UNCCD’s Executive Secretary Ibrahim Thiaw, the two organisations have agreed to  increase renewable energy capacity building and investment on the ground, get a better understanding of the land and renewable energy nexus and undertake joint outreach activities. The agreement was signed on the sidelines of the Conference of Parties to the United Nations Convention to Combat Desertification (COP14) which currently takes place in New Delhi, India.

“Today, renewable energy is the most effective climate action tool available. But renewables can play an important role in combating desertification and land degradation too”, said IRENA’s Director-General Francesco La Camera. “By signing today’s MoU, we intend to strengthen collaboration with the UN on country and regional support activities that accelerate renewables deployment as a component of a broader strategy to expand access to energy, foster sustainable development, biodiversity and climate resilience.”

Renewable energy is one of the solutions to restore land, as it can help conserve food or develop irrigation systems. There are a lot of areas for cooperation,” UNCCD’s Executive Secretary Ibrahim Thiaw said, adding that he expects renewable energy to be among the issues that could come up as a request from our Parties, in their efforts to halt and reverse land degradation.

Sustainable energy can stimulate land restoration and conservation efforts and improve the economic sustainability of projects undertaken. For example, renewables can electrify rural health centers, provide solutions in the agri-food sector and alleviate poverty through integrated rural community development projects. In regions like Africa and particularly the Sahel, additional bioenergy production through land restoration activities can generate further benefits by lightening the burden of energy in security while generating employment and income, thereby reducing poverty.

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ADB-Supported Solar Project in Cambodia Achieves Lowest-Ever Tariff in ASEAN

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The auction for 60 megawatts (MW) of solar photovoltaic (PV) capacity conducted by Electricite du Cambodge (EDC), Cambodia’s national electricity utility, has led to the lowest bid of 3.877 cents (US dollar) per kilowatt hour by Prime Road Alternative Company Limited. The project, supported by the Asian Development Bank (ADB), drew 26 bidders, including several global companies, and has achieved the lowest power purchase tariff for a solar project so far recorded in Southeast Asia.

The 60 MW project is part of a 100 MW National Solar Park and is structured as a public–private partnership. EDC is providing the land and transmission access, while the private sector  will provide power generation capacity based on a long-term power purchase agreement with EDC. ADB served as the transaction advisor for the project, through the Office of Public–Private Partnerships, while also providing a sovereign loan blended with climate finance funds to finance the transmission line and substation for the solar park. The project preparation work was carried out by ADB with the support of the governments of Canada and Singapore.

“The record low prices show the power of competition. This is a new era for renewable energy development in Cambodia and the region, and particularly for solar power generation. This is good news for EDC and the people of Cambodia,” said the Director of ADB’s Office of Public–Private Partnerships Mr. Siddharta Shah. “We believe more governments in the region will adopt auction as a strategy to procure renewable energy generation capacity, and this structure and tariff will serve as a benchmark for future projects.”

“Expanding solar generation is aligned with the country’s goal of increasing access to affordable and reliable sources of electricity,” said ADB Principal Climate Change Specialist Mr. Pradeep Tharakan. “ADB, as a trusted development partner of the government, is working toward the long-term development of the energy sector in the country.”

ADB’s other ongoing support to the country’s energy sector includes financing for the expansion and strengthening of the national grid; the development of a comprehensive power development plan through 2040; and the piloting of innovative technologies, including energy storage systems.

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IEA and ASEAN: “Key strategic partners” in pursuit of Southeast Asia’s energy goals

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The 37th ASEAN Ministers of Energy Meeting in Bangkok, 4 September 2019 (Photograph: IEA)

Dr Fatih Birol, the IEA’s Executive Director, took part in the 37th ASEAN Ministers of Energy Meeting (AMEM) in Bangkok on 4 September.

Dr Birol gave the opening presentation of the AMEM, discussing with Ministers the energy challenges facing ASEAN, as set out in the IEA’s forthcoming 2019 Southeast Asia Energy Outlook, and presenting the results of the IEA’s extensive work with ASEAN. As part of this, he highlighted the results of the IEA’s work in response to the ministerial mandates it received at the 2018 AMEM in Singapore, related to how the region can boost regional power trade, boost energy efficiency and speed up renewables integration.

ASEAN ministers released a Joint Ministerial Statement at the completion of the AMEM that expressed their “appreciation to the IEA Executive Director for contributing to stronger ASEAN-IEA institutional ties and advancing ASEAN energy priorities.” They confirmed that “the IEA is a key strategic partner to ASEAN in helping the region tackle its energy challenges across all fuels and all technologies”. Ministers also called for further “strengthening of the ASEAN-IEA partnership in 2019-2020, specifically through joint projects to increase regional power trade and renewables integration, enhance buildings energy efficiency, boost energy security and enhance energy data quality.”

On the margins of AMEM, Dr Birol met with ministers from various Southeast Asian countries, including three IEA Association countries (Indonesia, Thailand and Singapore) and the next AMEM chair, Viet Nam, to discuss the IEA’s engagement with the region and with the countries bilaterally.

While in Bangkok, Dr Birol also gave a special address at the ASEAN Energy Business Forum. His remarks focused on key global trends in energy markets and their implications for Southeast Asia.

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