ICIS View: Commission’s stance may undermine statistical transfers of renewable energy

27 June 2017 05:36 Source:ICIS

The European Commission has taken the decision not to inform member states of the potential punishments for missing their 2020 renewable targets, an approach that may reduce the likelihood of statistical transfers being arranged.

A spokeswoman for the commission confirmed to ICIS that member states currently have no idea what financial or other penalties they may face for missing their binding commitments, stating that the institution would not “speculate nor pre-empt any legal actions that might or might not be taken in the future”.

The spokeswoman said that the commission had “repeatedly encouraged” member states that are falling behind on the targets to make use of all the available instruments under the renewable energy directive, including statistical transfers.

However, if member states do not know what fines they will face for missing the targets, it is impossible for them to calculate what price they should be paying for statistical transfers.

Some countries may gamble on any potential fines being lower, and much further in the future after a protracted EU process, than the costs of statistical transfers to help reach the binding target by 2020.

By the same logic, the lack of transparency on fines may reduce the likelihood of countries attempting to rapidly build new renewable capacity to reach their target, if they fear this could end up being more expensive than the unknown future fines they could face.

As such, the commission’s position may undermine its goal of ensuring that all member states take the necessary action to meet their binding targets. matthew.jones@icis.com

By Matthew Jones