Renewable energy sources

Indicator	EU indicator past trend	Selected objective to be met by 2020	Indicative outlook of the EU meeting the selected objective by 2020
Share of renewable energy in gross final energy consumption		Reach a 20 % share of renewable energy in gross final energy consumption  - Renewable Energy Directive
The EU has steadily increased the share of renewable energy in its gross final energy consumption. If the current pace of progress is maintained, the 2020 renewable energy target will be met For further information on the scoreboard methodology please see Box I.3 in the EEA Environmental indicator report 2017

Setting the scene

The 7th EAP (EU, 2013) supports the EU’s objective of meeting its 2020 renewable energy target (EU, 2009). In comparison with fossil fuels, using renewable energy results in reduced greenhouse gas and air pollutant emissions, reduced environmental and health impacts, and a reduced dependency on energy imports.

Policy targets and progress

The Renewable Energy Directive (EU, 2009) commits the EU to reaching 20 % of renewable energy in gross final energy consumption by 2020. It sets binding national targets for renewable energy consumption in 2020 and it prescribes for each Member State minimum indicative trajectories in the run-up to 2020 to ensure that national targets will be met.

The Directive also requires Member States to adopt national renewable energy action plans that outline expected trajectories for the national share of renewable energy sources (RES) from 2010 to 2020. It also requires Member States to report every 2 years on progress towards the indicative trajectories of the Directive as well as towards the trajectories that they have set themselves in their action plans.

Figure 1. Share of renewable energy sources (RES) in gross final energy consumption, EU

As can be seen in Figure 1, the proportion of renewable energy in gross final energy consumption increased continuously between 2005 and 2015 to reach 16.7 % in 2015. The increase over the examined period has been more rapid than the target path prescribed by the Renewable Energy Directive, thus putting the EU well on the path to meet its 2020 target. The increase was mainly the result of various support schemes that were put in place by Member States, such as feed-in tariffs, feed-in premiums, auction/tender systems, quotas, tax credits and grants (EEA, 2016a). 

Shrinking production costs due to the scaling up of global production volumes and technological advances have also played an important role (IRENA, 2016a; EC, 2015a). Photovoltaics (technologies that transform solar energy to electricity) have experienced the largest reduction in costs, with costs per kilowatt hour decreasing by 53 % between 2010 and 2014 (Frankfurt School-UNEP Centre/BNEF, 2014). Electricity from onshore wind turbines became 15 % cheaper during the same period (Frankfurt School-UNEP Centre/BNEF, 2014).

If Member States fully deliver on their national renewable energy action plans, the EU will slightly over-achieve its target (by about 1 percentage point) (EEA, 2016b). Wind power, solar electricity and biofuels for transport are expected to grow fastest up to 2020 (EEA, 2017b). This was also the case during the 2005–2015 period, not least because these technologies started from a low initial level. In absolute terms, however, hydropower and biomass (for heat generation) could remain the most important single RES up to 2020, despite a decrease in their contribution to the overall energy produced by renewable sources (EEA, 2017b).  In 2015, hydropower accounted for 16 %, and biomass for 59 %, of final renewable energy consumption.

In terms of installed and connected renewable electricity capacity, the EU was second to China in 2015. With respect to new renewable electricity installed capacity, the EU has been gradually losing ground in recent years to non-European markets, such as China, Japan and the United States (EEA, 2017b). The EU was the region with the highest investment in renewable energy projects every year from 2005 to 2012, but has been surpassed by China since 2013 (Frankfurt School-UNEP Centre/BNEF, 2016). This highlights Europe’s pioneering role in developing renewable energy. However, since 2013 European investment in renewables has decreased, for example, in 2015 it decreased by 8 % compared with the previous year (Frankfurt School-UNEP Centre/BNEF, 2017). This reflected not only lower investment costs due to the reduction of production costs, as explained above, but also a slow down by some Member States that have already met or almost met their 2020 targets and some uncertainty surrounding the future of support mechanisms (Frankfurt School-UNEP Centre/BNEF, 2014). Regarding the latter, in the early 2010s, cuts in feed-in tariffs in some Member States were applied retroactively (i.e. to existing plants) and the switch from feed-in-tariffs to auction schemes led to uncertainty on the market, which may have caused some investors to hold back (EC, 2015a). 

Over the period 2005 – 2014, the share of renewable energy sources in the EU’s gross final energy consumption increased, on average, by 6.7 % annually. In 2015, this growth rate slightly decreased to 6.4 %, allowing the EU to reach a 16.7 % share of renewables in final energy consumption. Preliminary EEA estimates for 2016 show that the share of renewable energy sources in the EU’s gross final energy consumption will be circa 16.9 % (EEA, 2017a). This corresponds to a further slight deterioration of the growth rate of the share of renewable energies in the gross final energy consumption in 2016 – to 5.9 %. The slightly lower pace of growth is due to the increase in EU final energy consumption from all sources in 2015 and 2016, compared with 2014 (AIRS_PO2.7, 2017). The increase in energy consumption moderated the increase in the share of renewable energy consumption because if final energy consumption is higher, a higher overall quantity of energy is required from renewable energy sources to meet the target. 

Additional action from Member States may be required to ensure that the EU remains on the path to the 2020 target.

A number of European governments have introduced measures such as premiums on spot market prices, competitive tenders or capacity-dependent feed-in tariffs to help protect and increase the market penetration of renewable energy operators (EC, 2015a).

In 2014, the European Commission published guidelines on state aid for environmental protection and energy for the period up until 2020 (EC, 2014), which, inter alia, should contribute towards a more harmonised approach to supporting renewable energy growth across the EU.

Furthermore, in 2016, the European Commission proposed a set of Directives and Regulations in order to support the expansion of renewable energy sources; notably a recast of the Renewable Energy Directive (EC, 2016a) and several proposals for energy market design. Although the main focus and effects of these proposals will be felt post 2020, if adopted they will also enhance investor predictability prior to 2020 and they will help keep the momentum towards expanding renewable energy sources and therefore meeting the 2020 renewable energy target. For further information on these proposals please see the section ‘Outlook beyond 2020’. 

Country level information

Figure 2. Share of renewable energy sources (RES) in gross final energy consumption, by country

As can be seen in Figure 2, the contribution of RES to gross final energy consumption varies greatly between countries in Europe. This reflects different starting points in the deployment of renewables in each country and differences in the availability of natural resources to produce renewable energy. It also reflects, to some extent, differences in policies to stimulate renewables. Between 2005 and 2015, 14 EU countries at least doubled their renewable energy shares and Bulgaria, Croatia, the Czech Republic, Denmark, Estonia, Finland, Hungary, Italy, Lithuania, Romania and Sweden, as well as Iceland and Norway, have already reached their targets for 2020^[1].

The countries that are the furthest from their targets are France, Ireland, Luxembourg, the Netherlands and the United Kingdom (EEA, 2017c). Their progress in the deployment of renewable energy will play an important role in the prospects of the EU meeting its overall target.

Outlook beyond 2020

Additional deployment of RES beyond 2020 is vital if the EU is to achieve its aim of reducing its greenhouse gas emissions by 80–95 % by 2050 compared with 1990 levels — an aim that is key to the 7th EAP’s long-term vision of low-carbon growth decoupled from resource use well before 2050. EU countries have already agreed on a new, EU-wide renewable energy target of at least 27 % of gross final energy consumption by 2030 (EU Council, 2014).

Challenges for further progress in renewable energy are multiple. For instance, a key challenge is to arrive at a more unified and comprehensive European market design for energy – one that is able to maximise the use of intermittent renewable energy sources through cross-border interconnections, energy storage, wholesale trading and a flexible consumer demand – that lowers our need to invest in back-up power plants for meeting peak demands. Specifically in the case of biomass, there is a need to source and use this renewable energy source sustainably.

The Energy Union strategy (EC, 2015b) aims to ensure a secure, sustainable and affordable energy supply for all EU citizens and includes a number of energy and greenhouse gas emission targets for 2020, 2030 and 2050. The expansion of renewable energy sources is a key element of the strategy. More specifically, in order to overcome the expansion challenges of renewable energy and to meet the new EU 2030 renewables target, the European Commission proposed in 2016 a series of legislative measures. In particular, the Commission proposed a recast of the Renewable Energy Directive (EC, 2016a) and a new Regulation on the internal market for electricity (EC, 2016b). Both proposals aim to increase investment certainty for private operators, provide a more level playing field for energy technologies for the deployment of renewables and grant consumers a greater role in the development of renewable energy sources. The Renewable Energy Directive recast proposal also includes new sustainability criteria for bioenergy. In addition, the Commission proposed an Energy Union Governance Regulation (EC, 2016c) that requires Member States to prepare integrated national energy and climate plans that set out individual national climate, energy efficiency and renewable energy contributions by 2030 in order to reach the targets of the Energy Union Strategy. These proposals are currently being discussed by the European Parliament and the Council. It is expected that they will be adopted by the end of 2017.

About the indicator

This indicator is defined as the share of renewable energy in gross final energy consumption. Gross final energy consumption is defined as ‘energy commodities delivered for energy purposes to industry, transport, households, services including public services, agriculture, forestry and fisheries, including the consumption of electricity and heat by the energy branch for electricity and heat production and including losses of electricity and heat in distribution and transmission’ (EU, 2009). The indicator includes the contribution of renewable sources to all of the final uses of energy (electricity, transport, and heating and cooling). RES include wind, solar, aerothermal, geothermal, hydro, ocean energy sources, biomass and the biodegradable fraction of waste.