Renewable energy sources

Indicator	EU indicator past trend	Selected objective to be met by 2020	Indicative outlook for 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, although the rate of progress has been decreasing year-on-year since 2012. The EU continues to remain on course to meet its 2020 renewable energy target. For further information on the scoreboard methodology please see Box I.3 in the EEA Environmental indicator report 2018

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 emissions and can reduce air pollution, environmental and health impacts, and dependency on energy imports.

Policy targets and progress

The EU legislation concerning renewable energy — both the initial Renewable Energy Directive (EU, 2009) and the recast (EU, 2018a) — commit the EU to reaching a figure of 20 % renewable energy in gross final energy consumption by 2020. The 2009 directive also sets binding national targets for renewable energy consumption in 2020 and prescribes minimum indicative trajectories for each Member State in the run-up to 2020 to ensure that national targets will be met. It 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, and sets provisions for biennial national reporting on progress towards the indicative trajectories and the trajectories in the national action plans.

The recast Renewable Energy Directive also commits the EU to achieve a share of 32 % of renewable energy sources in gross final energy consumption by 2030 — for further information on this see the section ‘Outlook beyond 2020’.

As can be seen in Figure 1, the share of renewable energy in gross final energy consumption increased continuously between 2005 and 2016 to reach 17 % in 2016.

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, 2017a).  Shrinking production costs due to the scaling up of global production volumes and technological advances, along with a reduction in capital costs, have also played an important role in renewable energy deployment (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 73 % between 2010 and 2017 (IRENA, 2018).

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

Solar electricity, wind power, biogas for heat and electricity generation and biofuels for transport grew fastest during the 2005-2016 period, not least as these technologies started from low initial levels (EEA, 2017b). In absolute terms, however, hydropower and biomass fuels (for heat and electricity 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 2016, hydropower accounted for 15 %, and biomass fuels for 56 %, of final gross renewable energy consumption.

In terms of installed and connected renewable electricity capacity, the EU was second to China in 2016. 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). Since 2013, Europe’s share in global investments in renewable energy projects has decreased. For example, in 2016 it decreased by 3 percentage points compared with the previous year (Frankfurt School-UNEP Centre/BNEF, 2017). This reflected not only falling technology and capital costs but also a slow down by some Member States that have already met or almost met their 2020 targets, as well as some uncertainty surrounding the transition to auction-based support mechanisms (Frankfurt School-UNEP Centre/BNEF, 2014). Regarding subsidy programmes, in the early 2010s, cuts in feed-in tariffs in some Member States applied retroactively (i.e. to existing plants) may have caused some investors to hold back (EC, 2015a). Nevertheless, auction-based programmes have already replaced the initial subsidy-based support measures in the EU and, increasingly, globally and are pushing renewable energy projects to become more cost-competitive. In turn, this contributes to further reductions in the costs of renewable energy projects (Frankfurt School-UNEP Centre/BNEF, 2017).

Over the period 2005-2016, the share of renewable energy sources in the EU’s gross final energy consumption increased, on average, by 5.9 % annually. Since 2012, the annual growth rate of the share of renewable energy sources has decreased slightly, year-on-year. In 2015 and 2016, increases in energy consumption from all sources contributed to this trend.

Preliminary EEA estimates for 2017 show that the share of renewable energy sources in the EU’s gross final energy consumption will increase further and reach circa 17.4 % (EEA, 2018). However, this corresponds to a further deterioration of the growth rate of the share of renewable energies in gross final energy consumption in 2017 compared with 2016, bringing the annual average growth rate of the share of renewable energy sources in the EU’s gross final energy consumption down to 5.6 % for the 2005-2017 period. Similar to 2015 and 2016, the lower rate of growth in 2017 can be attributed, among other factors, to the increase in the EU’s gross final energy consumption compared with 2016 (EEA, 2018; AIRS_PO2.7, 2018).  

Despite the recent slowing down of the rate of growth of the share of renewable energy sources in the EU’s gross final energy consumption, overall the increase of the share of renewable energies has so far been more rapid than the target path prescribed by the Renewable Energy Directive. This means that the EU remains on track to meet its 2020 renewable energies target. However, given the slowing down of the growth rate of the renewable energy sources share in the EU’s gross final energy consumption, 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 addition, several Directives and Regulations that have just been adopted will support the future expansion of renewable energy. Although the focus of these legislative documents is primarily post 2020, their anticipation has been enhancing investor predictability and will help to maintain momentum in meeting the 2020 renewable energy sources target. For further information on these Directives and Regulations 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 2016, 15 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].

In 2016, as in 2015, the countries that are the furthest from their targets are France, Ireland, Luxembourg, the Netherlands and the United Kingdom (EEA, 2018). 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 in June 2018 on a new, EU-wide renewable energy target of at least 32 % of gross final energy consumption by 2030 (EU, 2018a).

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 to meet 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, in 2016, the European Commission proposed a series of legislative measures. The recast of the Renewable Energy Directive has just been adopted and the new Regulation on the internal market for electricity (EC, 2016a) is in the final stages of negotiation between the European Parliament and the Council. Both of these documents aim to increase investment certainty for private operators, provide a more level playing field for energy technologies and for the deployment of renewables, and grant consumers a greater role in the development of renewable energy sources. The Renewable Energy Directive recast also includes new sustainability criteria for bioenergy. The Energy Union Governance Regulation (EU, 2018b) was also recently adopted and it will require 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. It is expected that these legislative measures —complemented by several others such as the revised Energy Efficiency Directive (EU, 2018c), which was recently adopted and which requires the EU to meet a 32.5 % energy efficiency target by 2030 — will trigger significant increases in the share of renewable energy sources in the EU’s gross final energy consumption in the future.

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.