ENERGÍA FOTOVOLTAICA EN EUROPA

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Renewable energy policy developments and photovoltaic European markets

_______________________________________ Spanish experiences and Greek expectations

J. Muñoz Rodriguez *

EYDAP Water Supply and Sewerage Company. Division of Energy. Athens, Greece.

* Industrial Engineer in Energy Technology, H.T.S. Industrial Engineering, University of Castilla- La Mancha (UCLM), Avenida Camilo José Cela, s/n

Ciudad Real, Spain E-mail: [email protected]

Abstract:

The European photovoltaic market has grown exponentially in recent years, and improved its market share of the total energy. According to the estimates available, in 2008 total EU capacity was over 4.000 MWp. White paper objectives have thus been fulfilled before the 2010 and global photovoltaic production markets currently represent 25 % of the production on-grid. However the European photovoltaic sector remains very heterogeneous, with both a dominant German market and other countries of the EU, as Greece or Spain, that show a small market share.

Introduction

Even though the market is restricted by increasing demand and limited supply, photovoltaic market growth has exhibited a steady buoyant rate in the European Union. Power grid connection applications continue to represent almost all of European market, with a share estimated at 99, 4 % in 2007 [10]. The increase of on grid PV installations represents a mayor part of the common energy objective of the EU, which can be broken down into three ideas: sustainability against climate change, competitiveness and security of supply. These ideas were confirmed in 2nd International Conference on Solar Photovoltaic Investments (2nd ICSP) [4] in accordance with the Kyoto protocol and Lisbon strategy for industrial revolution aiming provide a real playing field for Renewable Energy Sources (RES).

The rapid establishment of photovoltaic sector, actively participating in total electricity production and in the creation of qualified jobs, is a challenge for society, to which the political decision makers are beginning to respond. Politicians are in the progress of settings up just remuneration systems for solar electricity, but efforts must be intensified even more by providing industrialists with a more long term vision and in removing administrative obstacles.

Figure 1. Schematic photovoltaic installation on–gr id and cells technology details. www.solaria.com

Renewable energy policy developments and photovoltaic European markets ______________________________________________________________________________

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Figure 2. Cumulated photovoltaic capacity in Greece, abstracted from Le Journal des Energies Renouvelables, Photovoltaic Barometer, 184, April 2008 Yellow zone shows PV capacity installed during the year 2007, and blue zone the total cumulated. Over 64 % are off-grid connections. EurObserv’ER 61, European Commission Barometer, April 2008

Policy for the Members States: SET- plan and Third Energy package

In order to coordinate of efforts both at European and national level, the Members States

must develop a stable political framework based on EU directives transposes into national laws, establishing the minimum requirements on which national legislation is based. Actually, around 70 % of the national legislation for green technologies has EU roots. In 2003, European Commission (EC) proposed the following basic common objectives:


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The EC proposal for a Framework Directive for the promotion of RES search:

- Flexibility to reach the targets - Cost effective solutions - Consolidate the existing directives in one compressive piece of legislation - Not undermining the existing successful support mechanisms - 20 % binding target for RES share of 2020 - Binding priority access to the grid for RES- Energies

- Progress towards removal of administrative barriers

- Increased information, training and accreditation of installers

Strategic Energy Technology Plan (SET-Plan) has as an objective to join forces at EU level to increase and improve investment of new energy technologies in order to foster a rapid development of low carbon technologies. This involves strategic elements for successful implementation, with large scale industrial initiatives where “business as usual” is not an option. The cooperation of technology platforms will help Members States to select technologies for which the EU needs oriented action country by country, because Europe wants to decrease energy dependence.

In the photovoltaic market, the silicon shortage has put pressure on many European players to adapt their strategies as a result. The companies are trying to sign long term contracts with silicon producers (Hemlock, Wacker, REC, etc.) or to become silicon producers themselves by creating joint ventures with the same manufacturers. Certain industrialists are even trying to be more and more autonomous by following a vertical type of strategy, going from the production of silicon up to the supply of the photovoltaic modules [9]. They are also developping ever thinner crystalline silicon cells to spare the raw material. Finally, more and more manufactures are diversifying their activities into other technologies such as thin silicon waters ( CIGS- copper indium gallium selenide, in particular), which consume less material and offers the perspective of a greater reduction of production costs than those for crystalline silicon. These different strategies for ensuring procurement security and reducing production costs should enable the European industry to compete more effectively with the Japanese and Chinese industrialist on the gigantic world market that is emerging on the horizon.

Finally the Third Energy Package, proposal for Dir. 2003/54/CE which deals with common laws for the internal market in electricity, pursues liberalization of electricity market and increased cooperation between national and European regulators. This should facilitate cross-border investments and infrastructures and reduce fragmentation of national or regional markets, while also establishing the conditions for cross-border exchanges in electricity. In 2nd ICSPI was proposed an ownership unbundling: facilitating access to the grid for new entrants, option which serious problems to implement for countries like Greece, that have administrative obstacles linked to connections on – grid.


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Spanish consolidated growth

According with the first estimates of IDAE (Institute for the Energy Diversification and Conservation), the newly installed capacity in Spain in 2008 is the neighborhood of 515,815 MWp, including the installations off-grid; this represents a growth of 200 % per year since 2005. The Spanish market thus, has significantly benefited from Royal Decree 661/2007, which is the principal renewable electricity promotion instrument.

The spectacular growth is supported by dynamic remunerative policies, with fiscal benefits and TIF’s for photovoltaic electricity that is not based on a fixed price, but instead, it is calculated as a function of a percentage of a mean price of electricity during the year in progress. All these financial benefits along with Spain’s geographic position and favorable climate conditions are joining to spectral good zone where Spain is located, which generate 1700 kWh/kWp of specific production rate for PV installation.

The Spanish government seems prepared to increase the feed-in tariff for installations included between 100Wp and 10 MWp to 0,4175 €/ Kwh in the second semester 2008 and fixed supports installation structures involves capital costs in neighborhood of 6-6,5 €/W. Route sheet Photovoltaic Installations in Spanish market

What follows is a summary of the requirements and processes that need to be followed by special system producers for photovoltaic installations [8].

A. Developer's application

- If it is a ground installation, the developer must deposit a €500/kW guarantee with the Regional Government. If it is a roof installation, this guarantee is not required.

- The developer applies to the distribution company for a connection point by filling in and attaching the documentation indicated therein.

- The distribution company sends a report with the connection location and other requirements.

- The developer informs the distribution company that he accepts the report and the requirements for the connection point.

B. Project approval from the Regional Government

- The developer will apply to the Regional Government for administrative authorization and will submit the basic project and implementation schedule.

- The developer submits a copy of the administrative authorization application, evidence of the submission of the basic project and the execution schedule approved by the Regional Government to the distribution company.

- The developer provides the distribution company with the administrative authorization and the project approval certificate issued by the Regional Government.


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C. Project execution

1. Grid connection

- The distribution company provides the developer with the connection contract, the supply checking certificate (if the installation power is less than 450 kW) and an access and connection certificate.

- The developer gives the distribution company the start-up certificate or the electrical installation certificate, and requests connection to the grid.

- The distribution company connects the photovoltaic installation to the power grid.

2. Contracting

- In the case of high-voltage connections, the developer must contact an authorized selling company¹ in order to sign the supply contract.

- In the case of low-voltage connections, the developer must contact the electric distribution company in order to sign the supply contract.

- The developer signs the supply contract.

3. Metering equipment installation

- The metering equipment can belong either to the developer or to the distribution company

- Installations of over 15 kW must be fitted with communications devices to enable the use of remote metering equipment.

- The developer will provide a copy of the final registration of the installation to the Regional Government's Special System register.

D. Billing

- According to Article 14 of Royal Decree 661/07, it is the Final Registration with the electric company which gives the right to charge for energy under the special system.

- Payment is only made once the Final Registration has been sent to the distribution company, retroactively from the date of the electrical installation certificate or the start-up certificate and after the 30 day trial period.

- Trial payment (at hourly price) will be made from the date of the electrical installation or start-up certificate until the first day of the month following that certificate, and an average tariff or payment rate is decided based on the 30- day trial period.

- Rate final TIF’s payment is made from the first day of the month following the date of the electrical installation or start-up certificate.

The first estimates from the IDAE (Spanish Institute for the Diversification and Savings of Energy) confirm the significant increase of the photovoltaic sector in Spain in 2007, with an additional capacity of 340.8MWp (339.8MWp connected to the power grid and 1 MWp off-grid), i.e. growth of nearly 200% with respect to 2006. Spain’s total installed capacity now represents 515.8 MWp, i.e. 11% of total EU installed capacity. The targets of


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the renewable energy plan (2005-2010) – 400MWp at the end of 2010 – have been reached three years earlier.

The feed-in tariff applied in Spain up until 28 September 2008 is that defined by

Royal Decree 661/2007 of 26 May 2007. This is especially favourable to the installation of large size power plants:

• The tariff valid for the first 25 years varies from 0.4404€/kWh for

installations smaller than or equal to 100 kWp (0.3523€/kWh after 25 years), to 0.4175€/kWh for installations between 100 kWp and 10 MWp included (and then 0.3340€/kWh) and 0.2294€/kWh for power plants up to 50 MWp (and then 0.1838€/kWh).

• The new feed-in tariff system is currently under discussion. A proposal

coming from the Ministry of Industry would distinguish between power plants that are integrated in the building (varying from 0.44€/kWh for power plants smaller than or equal to 20 kWp to 0.33€/kWh for power plants higher than 200 kWp) and ground based PV systems (0.33€/kWh) [9].

• This new feed-in tariff would be valid either up until 31 December 2009 or

until a capacity of 1.200 MWp is reached, which is the new government target for 2010. A feed-in tariff system including decreasing rates would then be set up.


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Greek market on standby

Even though Greece is one of the sunniest countries of the European Union is still struggling to develop its markets, with less than 10 MWp on-grid installed in 2007 according to HELAPCO [7] (Greek Association of Photovoltaic Companies). This situation can appear to be paradoxical, taking into consideration the adoption of a new Renewable Energy Law in June 2007 that was supposed to facilitate the procedures for obtaining an authorization to produce electricity and improving the feed-in tariff conditions. The feed-in tariff is guaranteed for twenty years and varies according to whether the installations are connected on the continent or in the islands.

Since the promulgation of this law, the

independent energy regulator authority (RAE) nevertheless received connection request application for more than 220 MWp. Unfortunately, according to HELAPCO, it is highly probable that only a modest portion of these installations shall be connected, in view that the administrative problems linked to connections still haven’t been resolved.

A new PV law was introduced in Greece on January 15th 2009, amending the legislation

originally voted in mid-2006 [7].

The new PV law develops the next following targets: - Sets a deadline for issuing permits. By the end of 2009, all applications that have been submitted so far (more than 3 GWp) must be dealt with and approved or rejected (this deadline is set for the first permit needed, the so called “Production License”). - Abolishes the unofficial cap of 0.8 GWp that was set by previous decisions. No cap will be valid as of now on. - Announces a separate program for rooftop PV with different feed-in-tariffs (FIT) guaranteed for 20 years. Details of this program will be announced later this year. - Introduces a tender process for PV systems >10 MWp. Details on how this is going to work are expected later in the year. - It is yet unclear when RAE will receive new applications (probably after 2009). Until then, a newcomer has the option of acquiring an existing company which has a permit.


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- New feed-in-tariffs (FIT) are set. These tariffs are guaranteed for 20 years. FITs will be adjusted annually for inflation (25% of last year’s Consumer Price Index). FITs will remain unchanged for the next two years. There will be a regression of FITs as of Aug. 2010. However, one can sign a grid connection agreement thus locking the FIT before this deadline, and then get another 18 months to finalize installation. In practice, this means that FITs remain unchanged till early 2012.

The new tariffs will start at 40c€/kWh in February 2009 for 100 kilowatt peak systems and 45c€/kWh for systems less and equal to 100 kilowatt peak on the mainland.

Figure 3. Evolution of the worldwide photovoltaic cell production in MWp Eurobarometer 2008


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Figure 4. General data of Energy sources distributi on in Greece. Intelligent Energy-Europe program, European Commission

Energy statistics for Greece

2000 2001 2002 2003 2004 2005 2006

Production 10,01 9,98 10,71 10,00 10,30 10,32 10,06

Solid fuels 8,22 8,39 8,91 8,18 8,55 8,54 8,14 Oil 0,28 0,19 0,32 0,22 0,13 0,10 0,09

Gas 0,04 0,04 0,04 0,03 0,03 0,02 0,03 Nuclear

Renewables 1,40 1,32 1,39 1,54 1,55 1,63 1,79 Industrial waste 0,06 0,04 0,04 0,03 0,03 0,02 0,01 Gross Inland Consumption 28,22 29,06 29,86 30,31 30,77 31,35 31,51

Solid fuels 9,04 9,31 9,32 8,91 9,10 8,95 8,39 Oil 16,01 16,50 17,06 17,62 17,61 18,06 18,21

Gas 1,70 1,68 1,80 2,03 2,23 2,35 2,75 Nuclear

Renewables 1,40 1,32 1,39 1,54 1,55 1,63 1,80 Other (****) 0,06 0,25 0,29 0,21 0,28 0,35 0,37

Elec. Generation (TWh) 53,84 53,70 54,61 58,47 59,35 60,02 60,79 Coal (TWh) 34,31 35,43 34,57 35,17 35,38 35,54 32,26 Oil (TWh) 8,89 8,48 8,63 8,71 8,39 9,21 9,60

Gas (TWh) 5,92 6,13 7,06 8,00 8,99 8,17 10,61 Renewables (TWh) (*) 4,14 2,93 3,58 5,89 5,92 6,41 7,86

Other (TWh) (***) 0,58 0,73 0,77 0,71 0,67 0,69 0,45 Figure 5. The new Feed-in-Tariffs in Greek photovol taic market. FITs guaranteed for 20 years. FITs adjusted annually for inflation (25% of last year’s Consumer Price Index). Hellenic Association of Photovoltaic Companies (HELAPCO)


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Conclusions Photovoltaic sector, which is rising as an alternative energy, has become in a necessary

source for electric generation. Thus, PV installations growth could be very fast in the coming years. The silicon shortage is in the process of being progressively absorbed, which is finally going to allow industrialist to fully use their production capacities and supply to fully meet demand.

The prices of installations are also going to able to continue to decrease for Euro-zone, so this is going to improve the sector’s competitiveness for those Member States with dynamic Feed-in tariffs.

Protectionist policies about public statements, which tariffs uncompetitive in the medium and high voltage on electricity market scenario in the case of Greece [1], are in disadvantage with these kinds of technologies that need to grow in a liberation market which offers a good framework for providers and developers. Actually, RES markets as Germany, Spain or Italy improved their results in photovoltaic targets providing the sector with special laws; it means developing the fiscal benefits to safe wealth and low energetic dependence for Governments.

Figure 7. Yearly global irradiation in Europe (kWh/m2). Joint Research Centre, European commission

Figure 6. Irradiance distribution for Athinai area in a representative day in August for optimal Irradiation angle. Joint Research Centre, European commission

The indirect advantages are as

attractive as environmental care and energetic safe, with thousand direct employment for installers, technicians, providers, etc. All these policies are the way of a future European energetic framework to reduce the fossil fuels dependence and its effect on general national wealth safe for Governments and citizens.

Greece’s mainland and islands are enclosing in the solar band with best conditions for PV generation. This, along with a suitable technology, would become the country in one of the best PV power per inhabitant rate in Europe. So technical data is really promising. The fact is the legality supporting for these excellent conditions have serious restrictions in the actual public electric market, with stressing limits that make PV potential inefficient.


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So actual laws, including last one Law 15/01/09 on PV TIF’s , are insufficiencies to exploit the real benefit and potential that PV has over citizens and countries. It has to develop and special framework on tariffs-in and RES sources connected on grid, far from the monopoly.

In Spain all these considerations were adapted to the new EC laws, creating a special market for RES supply, with minimum administrative barriers and excellent dynamic TIF’s for providers, regressed every each three moths per year (RD 661/2007). Actually Spain has similar spectral solar band than Greece, even more heterogeneous, with more cloudy days per year and the continental extreme weather most days in the Typical Meteorological Year.

Electric Generation in

Greece

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10,00

20,00

30,00

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50,00

60,00

70,00

1985 1990 1995 2000 2005 2010

Year

Ele

ctri

c G

ener

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n (

TW

h)

Total generation

Renewable

Figure 8. Yearly electric generation in Greece (TWh )

White Book, European commission

Energy Consumption in Greece

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0,00

5,00

10,00

15,00

20,00

25,00

1985 1990 1995 2000 2005 2010 2015

Year

Fin

al E

ner

gy

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nsu

mp

tion

(M

To

e)

Total Consumption

Renewable

White Book

The figure 8 shows distribution in electric generation for Greece, where renewable represents around 13 % of total electric supply in 2008. So, according with the Energy Pocket Book [6], photovoltaic energy on-grid is around 1 GWh per year, a really low number for one country which high solar-generation capacity, with 1325 kWh/kWp of specific rate production.

Instead Greece passes the minimum requirements of European Commission for 2010, in the other hand Greek Administration is failing to take advance in their Photovoltaic’s possibilities to facilitate PV installations without administrative troubles and supported by European financial aids. In order to provide its renewable and PV capacity, Greece would reach the 30 % energy supply from renewable sources with PV technologies as principal column for future, however real percentage around 5, 1 % of renewable consumption over total energy consummated is far away from common targets for 2010, it means 4 MToe, 15 % of total energy consumption [6]. It will be determinate for electric generation expenses for overloaded Greek public system and regional development.

Figure 9. Energy Consumption in Greece (MToe)

White Book, European commission


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Bibliography & References 1. Adamopoulou, Getsios, Nikiforiadis, Rizou. “Greek Energy Market- Legislative

Framework”. Endesa Hellas (2008). 2. Decree 2001/77/CE of European Parliament (Sep. 2001).

3. E. Dunlop, T. Huld, “PV-GIS: a Web Base Solar Radiation Database for the Calculation of

PV Potential in Europe”, International Journal of Sustainable Energy (2008).

4. E. Despotou, “ Policy developments at EU level and its impact on national markets”, 2nd International Conference on Solar Photovoltaic Investments, (Feb. 2008).

5. European Commission Factsheets by Country

http://ec.europa.eu/energy/energy_policy/facts

6. Energy Pocket Book. Intelligent Energy- Europe, European Commission (2009).

7. FIT’s in Photovoltaic Greek Market, Hellenic Association of Photovoltaic Companies.

8. IBERDROLA Hellas, about route sheet to connect PV on-grid. www.iberdrola.es 9. Joint Research Centre, European Commission. http://re.jrc.ec.europa.eu

10. PHOTOVOLTAIC ENERGY BAROMETER n° 184, Le Journal des Energies

Renouvelables, April 2008.

11. PHOTOVOLTAIC ENERGY BAROMETER n° 178, Le Journal des Energies Renouvelables, April 2007.

12. RD 661/07 about Internal Renewable Electricity Market in Spain (2007).

13. Renewable Gross Electricity Generation. Energy- Europe, European Commission (2009).

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