Policies for the development of RES in the European Union

Abstract

In recent years, the renewable energy sources (RES) have grown in importance in the energy system of the EU and in the world; it is expected they will grow more and more in importance in the near future. Since the costs of RES technologies are still higher than the technologies derived from fossil fuels, RES are in need of regulatory intervention. There is still uncertainty on the part of political authorities in relation to the type of policy to better manage the evolution of technologies in the RES market. The support mechanism for RES can be divided into price oriented and market oriented. The focus of this chapter is to analyze the RES support mechanisms among the new EU guidelines on state aid for environmental protection and energy 2014–2020 and in particular the transition from some tools (i.e., feed-in tariffs) to others (i.e., feed-in premium) in order to spur the development of RES. We evaluate the “success” of such instruments in relation to adaptation to the times: while feed-in tariffs can fulfill a variety of policy goals, feed-in premium can reach other objectives. We evaluate the effect of RES support mechanisms in relation to the market structure.