The rapid deployment of renewable energy technologies and their larger deployment in the near future, raise challenges and opportunities regarding their integration into energy supply systems. Energy systems aim at meeting the demands for a broad range of services (such as household and industry needs, transportation and storage). Energy systems include an energy supply sector and the end-use technology to provide the aforementioned energy services. In the EU and other industrialised countries, the existing energy supply system is mainly composed of large power units, mostly fossil fuelled and centrally controlled, with average capacities of hundreds of MW. Renewable energy sources are geographically widely distributed and if embedded in distribution networks are often closer to the customers. Locating renewable and distributed generators downstream in the distribution network is known as distributed generation.
Distributed generation involves the use of small, modular energy conversion units close to the point of consumption by a wide variety of producers. In the power sector, utilities have limited experience of interconnecting numerous small-scale generation units to their distribution networks and the possible level of renewables penetration depends mostly on the existing electrical infrastructure considered. Bringing on land the power produced from a large offshore wind farm is (economically) only possible when a strong electric grid exists and sufficient electricity grid capacity is available. Other cases exist where a completely new energy infrastructure with the specific purpose of allowing very high penetration levels, up to 100% electricity from renewables, has been established.
This decentralised energy generation, close to the end customer, differs fundamentally from the traditional model of energy system of large power stations generating centrally-controlled power. This approach is new, re placing the concept of economy of scale for large units by economy of numbers (production of small units in large quantities).3 Far from being a threat, distributed generation based on renewable energy offers opportunities. It can:
• Reduce the transmission and distribution losses as well as transmission and distribution costs;4
• Provide customers with continuity and reliability of supply;5
• Stimulate competition within renewable technologies to improve their competitiveness; and
• Be implemented in a short time due to the modular nature of renewable energy technologies.
Distributed generation is based, to a large extent, on the development and integration of renewable energy. This concept also involves energy efficiency and demand-side management measures at the customers' end. Renewable energy development and increase of energy efficiency are strongly interdependent. The European Union has always stressed the pressing need to renew commitment both at the community and member state levels to promote energy efficiency more actively. In the light of the Kyoto agreement to reduce CO2 emissions, only improved energy efficiency with increased use of renewables will play a key role in meeting the EU Kyoto target economically. In addition to a significant positive environmental impact, improved energy efficiency will lead to a more sustainable energy policy and enhanced security of supply, as well as to many other benefits.
The experience in some successful states in terms of RES electricity deployment shows that some minimum requirements are needed, such as:
• An attractive long-term, stable and effective financial framework;
• A coherent market support mechanism adapted to each renewable energy technology;
• Removal of administrative barriers through the implementation of uniform planning procedures and licensing systems;
• Guarantee of a fair grid access and non-discriminatory tariffs; and
• Least-cost network planning.
3 Weinberg 1995; Ianucci et al. 1999; World Energy Council 2001.
4 The IEA alternative scenario (WEO 2002; WEIO 2003) predicts savings of about 40% for the transmission grid and 36% for the distribution due in particular to the increased use of distributed generation energy.
5 This argument is a major driver when you take into account the recent blackouts in the United States and Italy.
The European Union has to follow up the implementation of existing supportive legislative or non-legislative measures that are already adopted on the European level. They have to be transformed into national policy as foreseen by the EU. If necessary, additional measures on the EU level have to be taken.
For the heating sector the situation is different. The administrations should take framework initiatives — if necessary, legislative proposals — to accelerate the fulfillment of the potential of three key technologies: modern biomass heating, solar heating and geothermal heat. These initiatives could include targets for specific technologies, or requirements for suppliers of heating oil and gas to supply wood pellets and biogas as well as non-discriminatory market access for heat and cold from renewable energy sources and a financial compensation for the macro-economic benefits of renewable energies. The installation of suitable financial support schemes in Europe, which creates a high level of security of investment, thus enables a broad supply of heat and cold from renewable energies and stimulates the regional creation of value.
For the EU, the adoption of future financial perspectives for 2007-2013 is the opportunity for the enlarged EU to express its political determination to change course and direct its efforts towards sustainable energy. This is the moment at which the EU can allocate the resources needed to achieve its goals in this field.
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