2023-11-21 10:30:02
Faced with a “unique set of challenges” facing the wind energy sector in Europe, the Commission presented, on October 24, an action plan aimed at “ensuring that the transition to clean energy goes hand in hand with competitiveness industrial”. Associate researcher at the French Institute of International Relations (Ifri), Cédric Philibert gives us his point of view on the prospects opened up by this plan, and gives us an overview of the main factors which, according to him, are slowing down the development of wind power. European.
Crossing the threshold of 500 GW of installed wind capacity by 2030 is what would be necessary to achieve, by the same deadline, the objective set by the European Union an energy mix composed of a share of renewables of at least 42.5%. However, the bar seems set particularly high: in 2022, installed wind capacity across the EU did not exceed 204 GW, increasing by 16 gigawatts compared to the previous year. A “record increase of 47% compared to 2021”as noted by the European Commission in a press release dated October 24which nonetheless remains largely insufficient. “This is significantly less than what the EU should install to be able to achieve its objectives”underlines in fact the one which describes itself as the voice of the European wind industry, the association WindEurope. At this rate, the threshold of 500 GW of installed capacity would only be crossed… in 2041.
To achieve this as hoped in 2030, no less than 37 GW of additional wind capacity would have to be installed each year by the Member States of the Union. A perspective that is uncertain to say the least, especially as the sector faces a series of problems that are hampering its development: « a unique set of challenges »as described by the President of the European Commission Ursula von der Leyen, starting with that of inflation.
Rising costs…and interest rates
Cédric Philibert is an independent consultant and senior analyst on energy and climate issues. He is also an associate researcher at the French Institute of International Relations (Ifri). © Ifri / DR
“Since the post-Covid recovery in mid-2021, then the Russian attempt to invade Ukraine, general inflation has put a certain number of companies in difficulty, particularly among manufacturers. [d’éoliennes]and among some developers as well »notes the researcher associated with the French Institute of International Relations (Ifri) Cédric Philibert, moreover auteurindependent consultant and analyst, specialist in energy and climate issues. “A certain number of projects had in fact been implemented at prices lower than the current cost price. Inflation has certainly affected materials, but also and above all interest rates, which are proving decisive for this sector which is undoubtedly the most capital-intensive of all”enlightens the man who was also advisor to the Director General of the Environment and Energy Management Agency (ADEME) from 1992 to 98.
Projects approved but therefore not yet carried out, for various reasons, such as disruptions in the supply of raw materials linked to the health crisis, or even connection problems. “The queue can be very long,” notes Mr. Philibert. One, two… even up to five years sometimes. If economic conditions change in the meantime, this could pose a problem.”.
The expert emphasizes, however, that France is not, in this regard, the worst-off country, largely thanks to the indexation mechanism that it has put in place. A system in fact supposed to protect producers against changes in their operating costs once their investments have been made, as explained by the Energy Regulatory Commission (CRE), and which therefore does not exist everywhere. “Certain European players, including French developers, find themselves exposed in these markets where there is no indexation, such as the United States”underlines Cédric Philibert.
And the expert points out a category of players – that of manufacturers – even more exposed to the storms blowing through the sector. Manufacturers find themselves affected by an even broader set of factors: cancellation of projects, reduction in margins, technical issues, but also strong Chinese competition. An aspect also pointed out by the European Commission, which speaks soberly of “increased pressure from international competitors”.
Sometimes unfavorable public policies
Finally, in addition to the problem of availability of qualified labor, a final factor explaining the rather delicate situation in which the European wind sector finds itself today is that of the slowness – and complexity – of procedures. authorization across EU member states, starting with France. “Authorizations go faster in other countries,” observes Mr. Philibert. Some seek more citizen participation, which often limits the number of appeals. This is the case of Germany and Denmark in particular. » European “champions” of wind power who, in addition to this aspect, owe their position as leaders to factors such as the power and solidity of their industry, their privileged geographical position, but also and above all a clear political will to promote deployment of this renewable energy. “There are lots of reasons for the differences within the EU, but a lot of it is politics, confirms Cédric Philibert. Germany, for example, has launched into wind power with much more vigor, just like Spain, Portugal, the Netherlands and Ireland. » Others, including France, remain held back by unsuitable policies, according to the expert.
The action plan presented on October 24, for example, provides for the creation of “European skills academies for the net zero industry”, including one for wind power. © Image by Markus Distelrath from Pixabay
An action plan to boost European wind power
THE “challenges” are therefore not lacking for the sector. A problematic situation facing which the EU has thus considered that a ” immediate action “ was necessary. On October 24, the Commission presented the EU wind energy action planas President von der Leyen announced the previous month in her State of the Union Address. Objective : “Ensuring that the transition to clean energy goes hand in hand with industrial competitiveness and that wind energy continues to be a European success story”notes the Commission in its press release of October 24. « Ce plan d’action will help maintain a healthy and competitive wind energy supply chain, with a clear and secure pipeline of projects, to attract the necessary financing and compete on a global level playing field »also specifies the document.
The action plan unveiled at the end of October thus defines a series of measures that Member States, industry, but also the Commission must take jointly and immediately. Measures focused around six main aspects: acceleration of authorization procedures, improvement of the design of auctions, facilitated access to financing, fight against unfair commercial practices on an international scale, support for the increase in skills by facilitating in particular the creation “European skills academies for net zero industry”including one for wind power and, finally, development of a wind power charter by the Commission, the Member States and the industry, with the aim “to improve the conditions conducive to maintaining the competitiveness of the European wind industry”.
“This European plan is quite useful”, judge Cédric Philibert, who sees in particular progress in terms of the authorization and auction regime, but who deplores the absence of a price modulation system. According to him, this would in fact prevent all wind projects from being concentrated in the north of Europe, and would therefore ultimately speed things up. “We must facilitate the installation of wind turbines where there is already solar power, and vice versa. The two production methods complement each other very well and can generally be satisfied with a single network for their connection. All this, however, requires a little modulation of prices”believes the analyst, who also judges that the action plan’s industry support measures are hampered by insufficient funding: “The IRA[1] American, just as the opaque Chinese systems support their industries in a way significantly greater than what Europe does with the Net-Zero Industry Act”.
Also strengthen offshore wind power to support on-shore installations tomorrow
The Commission presented the EU wind energy action plan on October 24, as President von der Leyen announced the previous month in her State of the Union speech. © European Union 2023 – NA
Alongside the presentation of this action plan, the Commission also affirmed “redouble your efforts” to support offshore wind power, through additional measures aimed in particular at strengthening network infrastructure, accelerating the granting of authorizations, or even supporting research and innovation as well as developing supply chains. supply and skills. “Offshore wind energy is expected to make a significant contribution to the EU’s climate and energy goals in the years to come”indeed hopes the Commission.
For Cédric Philibert, however, the priority remains the development of onshore wind power, the only way according to him to respond to the urgency of the current situation, which brings together the necessary decarbonization of production and the growth in electricity needs. “The potential for offshore wind power is significant in Europe, but projects in this area take longer to implement. Offshore wind power will ultimately support onshore wind power, but we cannot wait”, he believes. The analyst is convinced: “We need wind power right away”.
[1] Inflation Reduction Act“largest climate investment in United States history”, signed in August 2022 by President Biden.
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