Renewables could lose European power grid priority
Wind farms and solar power could soon lose the privilege of getting priority over other energy sources on European electricity grids, leaked documents show.
Paring back the ‘priority dispatch’ system could increase carbon emissions by up to 10 percent, according to a confidential EU impact assessment seen by the Guardian. But the document goes on to model four scenarios for doing just that, in a bid to make Europe’s energy generators more flexible and cost-competitive, nzherald.co.nz wrote.
Some industry sources have told the Guardian they are alarmed and think it highly likely that priority dispatch for clean energy will be scrapped from the EU’s renewable energy directive, which is currently being redrafted for the post-2020 period.
Oliver Joy, a spokesman for the WindEurope trade association, said: “Removing priority dispatch for renewable energies would be detrimental to the wind sector, which would face more curtailment across the continent. It also seems to be at odds with Europe’s plans to decarbonizes and increase renewables penetration over the next decade.”
“Investors took priority dispatch into account when projecting revenues in the original investment decisions, and it could have a bearing on existing projects if they are not protected from the change.”
The issue of retroactive changes to funding rules for renewables in Europe has been a cause for disputes and cutbacks in the wind and solar sectors of several countries, notably Spain.
Senior industry sources say they will push for financial compensation and access to balancing markets to help prevent a significant industry contraction, if priority dispatch is ended.
“We have had enough instability and retroactivity in Europe and going forward, the difference between existing and future assets should be well distinguished,” said one industry source.
“I would be extremely worried if they just removed priority of dispatch and did not touch other key issues around market design. It would mean that the commission was taking measures against the same renewable industries that they defend in public.”
Fossil fuel power providers argue that renewables have the lowest operating costs and so would anyway receive priority access to the grid network.
They also say that taking the clean energy sector out of priority dispatch would prevent ‘negative prices’ — where more energy is produced than can be sold – and eliminate anti-competitive subsidies.
The EU’s assessment views the abolishing of priority dispatch as a step towards the creation of a ‘level playing field’ for energy generators.