Page 55 - A Comprehensive Guide to Solar Energy Systems

50 A COMPREHEnSIVE GUIDE TO SOLAR EnERGy SySTEMS

3.4 Policy Recommendation for Solar in Europe

The European Commission presented a set of new legislative proposals in november 2016
known as the “Clean Energy for All Europeans” package, which sets out the post-2020
framework for the power sector in the EU.
SolarPower Europe sees three strategic reforms that need to be pursued in parallel in
order for solar PV to further penetrate the EU’s energy mix:

• A reliable governance framework to steer investments in renewable energy is needed,
and Europe needs to organize the orderly retreat from inflexible polluting plants.
Considering the long lead-time of investments in the energy sector and the fact
that literally all the investments compatible with the energy transition are capital
intensive, attracting low-cost finance will be key. Besides, the need for an ambitious
EU binding target (see previous section), clear national binding targets will signal to
the investment community the direction to take. Such long-term visibility is crucial
and needs to be made credible via the introduction of clear enforcement mechanisms
in case the national 2020 targets are not met, or in case the trajectory toward the 2030
target is jeopardized by a lack of renewable deployment.
While it is expected that around half of the power in Europe will be generated by
renewable energy sources by 2030, with solar playing a key role, it will be important
to organize an orderly retreat from inflexible and polluting generation capacities over
the next decade to create the space in the electricity market for solar plants. In parallel
and during the same period, flexible assets need to be ramped up. The so-called
“Governance” Regulation presented by the European Commission in 2016 provides a
unique opportunity to precisely steer the development of flexibility, and at the same
time, organize the corresponding exit of inflexible generation. This can be achieved by
the introduction of “national flexibility roadmaps,” which will provide visibility on the
evolution of the energy system at the national level.
• Market rules are needed, which allow for a market-based energy transition and enable a
flexible system to harness renewable energies. Compared to just 5 years ago, there is now
a broad recognition that market rules and products need to be redesigned to reflect the
specific characteristics of variable solar and wind generation. More liquid intraday and
balancing markets are crucial, alongside appropriate rules for the development of storage,
demand response, and aggregation—three key enablers for further solar penetration.
To ensure the energy transition will be market-based, we need a system that is able
to make the best of variable renewable energies when they are abundantly available.
This requires a cross-sectoral approach where electricity will play an increasing role in
mobility and heating and cooling, but also a specific regime to reduce the occurrence
of periods during which solar electricity is curtailed to let more polluting, less flexible
plants run. The current debate around capacity mechanisms is a perfect occasion
to consider the potential lock-in effect of subsidizing existing—or even worse—new
generation capacities in high carbon emitting technologies or inflexible nuclear