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The European Commission has unveiled an action plan to boost the competitiveness of its wind energy industry through measures such as faster permitting and funding access.
“It is estimated that European manufacturing can cover most of the current demand for wind turbines in the EU. But in order to maintain their competitiveness in a growing market driven by EU’s onshore and offshore wind ambitions, European wind manufacturers would need to rapidly scale up their capacities”, the Commission said in a communication to the European Parliament, Council, Economic and Social Committee and Committee of the Regions. “If this does not happen, supply bottlenecks could soon materialize leading either to slower deployment or to an increase in imports to fill the gap”.
The Wind Power Action Plan aims to help achieve the EU target of raising the share of renewables in its energy mix to 42.5 percent by 2030 and installed capacity to over 500 gigawatts (GW) by 2030 from 204 GW in 2022.
“Globally, annual wind capacity additions should reach at least 329 GW per year until 2030 to achieve net-zero emissions by 2050, more than quadrupling today’s deployment levels (75 GW)”, the Commission said. “Yet, the European wind industry has recently faced difficulties in operating its business.
“All largest wind turbine manufacturers reported significant operating losses in 2022. And with 16 GW of new wind projects installed in 2022, we are nowhere near the 37 GW/year needed as cost-effective contribution to achieving the EU 2030 targets”.
The proposed action plan seeks to fasttrack the permitting process for wind electricity projects, improve EU member states’ auction design for such projects, expand finance access, support skills development and strengthen engagement with the industry.
“The Commission will prioritize the acceleration of permitting by putting a strong emphasis on digitalization of national permitting processes across the EU as well [as] supporting the roll-out of training for national permitting authorities”, said the communication, whose text is available on the Commission’s website.
To provide market predictability, “[t]he Commission calls on the Member States to commit to specific, concrete pledges on wind energy deployment volumes for at least the period 2024-2026, providing a clear and credible overview of wind energy deployment in the next years, to be formalized by the end of 2023”, the communication stated. “These pledges should complement the ambitious commitments on offshore energy that amount to 111 GW across all EU sea basins by 2030”.
Under a sub-action plan for power grids targeted to be launched next month, the Commission aims for “key cross-border electricity infrastructure projects to be included in the first list of projects of common interest and projects of mutual interest following the adoption of the revised regulation on the Trans-European Energy Networks”.
“The [grid] action plan will include measures to address bottlenecks hampering grid reinforcement and expansion, including cross-border cost sharing, and manufacturing, which are crucial to help to unblock a larger number of onshore and offshore wind projects, trigger investment in wind projects in coastal Member States and transport infrastructure towards landlocked regions in Europe and in this way create additional demand for wind equipment”, it said. “The grids action plan will also facilitate anticipatory investments to ensure the necessary grid development”.
For renewable energy leasing auctions, the Commission wants member states to consider avoiding uncapped negative bidding, “which may lead to very high bids for wind projects and increase the risk for full and timely delivery of such projects”, the communication said.
The Wind Power Action Plan also aims to address bid ceiling-induced undersubscription in auctions.
For funding, the plan proposes doubling the budget for clean technology manufacturing under the Innovation Fund to EUR 1.4 billion ($1.48 billion), including projects for the production of wind turbines and their components, in a call for proposals on November 23.
“To support project developers and ensure that a solid pipeline of innovative projects is being built, wind energy projects should also get priority for the EUR 90 million [$95.02 million] of Innovation Fund project development assistance that will be provided in cooperation with the European Investment Bank over the next 3 years”, the communication added.
“By end of this year, the Commission will also strengthen wind-related activities under the revised Strategic Energy Technology Plan (STEP), along with increased support for research and innovation in the wind manufacturing sector, so that relevant European technologies keep their competitive edge, in particular on issues linked to circularity and sustainability, improving industrial processes and digitalization”, it said. “The STEP will also open new opportunities for supporting investment that aims to scale up the EU’s manufacturing of clean technologies, including wind power, which could particularly benefit transition and less-developed regions as well as developed regions in Member States with a GDP/capita [gross domestic product per capita] below the EU average”.
Furthermore the Commission and the European Investment Bank (EIB) are jointly working to launch in the coming three to six months a facility “to counter-guarantee commercial banks’ credit exposures to key wind industry suppliers, increasing access to advance payment and performance guarantee lines”.
“The Commission has also proposed as part of STEP to increase the EU guarantee by EUR 7.5 billion [$7.92 billion] through a dedicated window of InvestEU, which would increase the capacity of the EIB Group and other implementing partners to support investment in development and manufacturing of the clean and other technologies, including for the wind sector”, the communication added.
To promote access for EU companies to the global wind energy market, the plan aims to secure counter-subsidies for “foreign distorting subsidies” that “allow wind manufacturers receiving them to be successful in public procurement procedures or in concentrations involving EU target companies”.
The Wind Power Action Plan also aims to promote the adoption of EU and international standards for the sector.
To contact the author, email jov.onsat@rigzone.com
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