EN    EN EN 
 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 24.04.2009 
SEC(2009) 503 final 
  
COMMISSION STAFF WORKING DOCUMENT 
The Renewable Energy Progress Report 
Accompanying document to the  
COMMUNICATION FROM THE COMMISSI ON TO THE CO UNCIL AND THE 
EUROPEAN PARLIAMENT 
The Renewable Energy Progress Report 
Commission Report in accordance with Articl e 3 of Directive 2001/77/ EC, Article 4(2) of 
Directive 2003/30/EC and on the implemen tation of the EU Biomass Action Plan 
COM(2005) 628 
{COM(2009) 192 final} 
.
 
EN 2   EN 1. Introduction................................................................................................................ .. 3 
2. The electricity sector.................................................................................................... 3 2.1 Support Schemes.......................................................................................................... 5 2.2 Administrative barrie rs and grid access ....................................................................... 7 
2.3 Guarantees of Origin.................................................................................................. 10 2.4 Member State progress towards the 2010 targets ...................................................... 11 3. The transport sector.................................................................................................... 15 3.1 Progress in the use of biofuels  and other renewable fuels ......................................... 16 
3.2. Support schemes......................................................................................................... 18  
3.3. Economic impacts ...................................................................................................... 27 3.4. Environmental impacts............................................................................................... 31 3.5. Further measures needed in the transport sector........................................................ 35 4. The implementation of the biomass action plan ........................................................ 37 4.1. Availability of biomass .............................................................................................. 38 4.2. Actions taken to increase the av ailability and use of biomass................................... 38 
4.3. Barriers to the uptake of bioenergy............................................................................ 40 4.4. Implementation of the thirty-three ac tions of the Biomass Action Plan.................... 41 
Annex A: Member States' support schemes for el ectricity from renewable energy sources. .. 45 
Annex B: Review of the progr ess in different renewable electricity technologies.................. 53 
Annex C: Biofuel Energy Share............................................................................................... 59 Annex D: 2nd-generation biofue l facilities in Europe ............................................................. 60 
 
EN 3   EN 1. I NTRODUCTION  
This document accompanies COM(2009)XXX whic h outlines the progress the European 
Union is making developing renewable energ y. The Communication recalls the European 
policy framework for renewable energy1: the importance of renewable energy for meeting our 
climate change and sustainability objectives, im proving the security of our energy supply and 
developing an innovative European  renewable energy industry to ge nerate jobs and wealth for 
Europe.  
This document provides the background material and analysis supporting the results presented 
in the Communication. It provides a summary of the detailed anal ysis undertaken for or by the 
Commission which explored the ra te of progress and barriers to  further growth in renewable 
energy and the impacts of biofuels in tran sport, as required under Directive 2003/30/EC2. 
2. T HE ELECTRICITY SECTOR  
There are well recognised reasons for increasi ng the share of electricity from renewable 
energy sources in the European Union. It w ill improve energy security, mitigate greenhouse 
gas emissions and regional and local pollutants from the power sector and it will increase the European Union's competitiveness in renewabl e energy technologies. For these reasons, the 
European Union set a target to source 21% of electricity from renewable energy sources by 
2010
3. Each Member State has a national indicativ e target for electricity from renewable 
energy sources to contribute toward s the overall target. Member St ates are free to choose their 
preferred support mechanism in order to achieve their target. Directive 2001/77/EC4 further 
stipulates that Member States must improve their grid access for renewable energy generators, streamline and facilitate  authorisation procedures and establish a system for guarantees of 
origin. 
Under Article 3 of Directive 2001/77/EC, Memb er States are require d to publish a biannual 
report analysing progress against their nation al indicative target. This Communication 
assesses the extent to which Member States  have made progress towards achieving their 
national indicative targets, ensuring that their effort is consistent with the 21% indicative 
share of electricity produced from renewable energy sources in total Community electricity 
consumption by 2010.  
                                                
 
1 As part of the new energy and climate change policy, the Commission proposed a new, more rigorous 
framework to drive forward the development of renewable energy and the need for more solid, legally binding targets for 2020. The new legislation covers  all renewable energy and set new targets for 2020 
to ensure a stable regulatory framework for the d ecade ahead. This new Renewable Energy Directive 
has now been agreed. In parallel to the development of the legislative framework, the Commission modified the Community Guidelines on state aid for environmental protection (OJ C 82, 1.4.2008, p.1); 
the new Guidelines entered into force in April 2008. Furthermore, under certain conditions, aid can be 
block exempted due to the adoption in July 2008 of the General Block Exemption Regulation (OJ L 214, 9.8.2008, p.3). For national support measures wh ich constitute State aid in the meaning of Article 
87(1) of the EC Treaty, these rules establish th e conditions under which Member States can grant 
financial support for the promotion of energy from renewable energy sources 
2 http://ec.europa.eu/energy/res/legislation/doc/biofuels/en_final.pdf  
Directive 2003/30/EC of the European Parliament and of the Council of 8 May 2003 on the promotion 
of the use of biofuels or other renewable fuels for transport 
3 This target was set in Directive 2001/77/EC at 22.1% and was realigned to 21% in 2004 when the 10 
new Member States joined the EU. It remained at  21% when Bulgaria and Romania joined the EU.  
4 http://eur-lex.europa.eu/LexUriServ/LexUriSe rv.do?uri=OJ:L:2001:283:0033:0040:EN:PDF 
 Directive 2001/77/EC of the European Parliament and of the Council of 27 September 2001 on the 
promotion of electricity produced from renewable energy sources in the internal energy market.  
 
EN 4   EN In 1997, when the European Commission initia ted discussions on a European renewable 
energy policy, the share of renewable electricit y in what is now the European Union was 
12.9%. By 2006, 15.7% of the European Union's final electricity co nsumption was from 
renewable energy sources: a 21.7% increase from 1997 levels5.  
Renewable electricity generation in the European Union's 27 Member States in 1997 
compared to 2006. 
0100200300400500
1997 [TWh] 2006 [TWh]Wind off-shore
Wind on-shore
Tide & Wave
Solar thermal electricity
Photovoltaics
Geothermal electricity
Biowaste
Solid Biomass
Biogas 
Hydro small-scale
Hydro large-scale
 
Source: Eurostat data 2006 (with normalised hydro) 
Renewable electricity generati on in European Union in 2006. 
RES-E 2006 breakdown
01020304050607080
AT BE BG CY CZ DE DK EE ES FI FR GR HU IE IT LT LU LV MT NL PL PT RO SE SI SK UKElectricity generation [TWh/year] _
Biogas Solid biomass Biowaste Geothermal electricity Photovoltaics
Wind on-shore Wind off-shore Hydro small-scale Hydro large-scale 
Source: Eurostat/Fraunhofer ISI: Electricity from renewable energy sources 2006 breakdown of normalised 
renewable electricity in 2006  
                                                 
5 Source: Eurostat data 2006 (normalised hydro)  
 
EN 5   EN 2.1 Support Schemes 
Member States are required to support electric ity from renewable ener gy sources. Currently, 
Member States operate 27 different support sche mes using various policy tools, including: 
feed-in tariffs; premium systems; green certi ficates; tax exemptions; obligations on fuel 
suppliers; public procurement policy; and re search and development. The support schemes 
differ partly because support has traditionally been  linked to other nationa l priorities and also 
because national electricity markets still have  very different characteristics and remain 
nationally segmented, despite the market opening foreseen by Directive 2003/54/EC6. 
Article 4 of Directive 2001/77/ EC required the Commission to present a report in 2005 on the 
mechanisms for supporting renewable energy. COM (2005)6277 assessed national support 
schemes and concluded that rather than imme diate harmonisation, a coor dinated approach to 
renewable energy support schemes was more  appropriate, based on cooperation between 
countries and optimisation of support schemes.  
On 23 January 2008, the Commission published (SEC (2008)578). This Communication also 
concluded that although harmonisation of suppo rt schemes was a long-term goal it was not 
appropriate in the short-term. The report noted that by adopting best pract ices or combining 
national support schemes Member States could continue to reform, optimise and coordinate 
their efforts to support renewable electricity.  
Long term stability 
One element of best practice for national suppor t schemes is to provide stability, such as 
through the setting of targets or other objectives and the creation of long term support 
mechanisms. It is not the only critical feature of support schemes, (which also include an 
adequate level of support and technological differentiation), but if support schemes can be 
guaranteed for reasonable time periods, they not only produce an income for renewable energy producers, they reassure banks or other financing institutions regarding the risk they 
face for their loans or investments. If the risk is reduced by a stable and guaranteed minimum 
income, capital is cheaper. The following tabl e considers Member States' performance on 
ensuring long term stability  in their support scheme. 
                                                
 
6 http://eur-lex.europa.eu/LexUriServ/LexUriSe rv.do?uri=OJ:L:2003:176:0037:0055:EN:PDF 
Directive 2003/54/EC of the European Parliament and of the Council concerning common rules for the 
internal market in electricity an d repealing Directive 96/92/EC  
7 http://eur-lex.europa.eu/LexUriServ/LexU riServ.do?uri=COM:2005:0627:FIN:EN:PDF 
Communication from the Commission: the support of energy from renewable sources 
8 http://ec.europa.eu/energy/climate_actions/doc/2008_res_working_document_en.pdf  
Commission Staff Working Document: the support of  electricity from renewa ble energy sources: 
accompanying document to COM (2008) 19 proposal for a Directive of the European Parliament and of 
the Council on the promotion of the use of  electricity from renewable energy sources 
 
EN 6   EN Table 1: Long term stability of Member States' support schemes. 
 Long term stability 
Austria Feed-in tariffs guaranteed for 10 years with  two additional years at a reduced rate.  
Belgium Minimum prices guaranteed for 10 years (20 years for offshore wind and for photovoltaic 
power in Flanders).  
Bulgaria Preferential prices set annually for all renewabl e electricity plants put into operation before 
31 December 2010. (In accordance with Article 3 of the Transitional and Final Provisions 
Law the Minister for the Economy and Energy is required to develop a market mechanism 
to promote electrical and th ermal energy produced from renewable energy for approval 
from the Council of Minister s by 31 December 2011).  
Cyprus A financial mechanism to encourage renewa ble energy sources is in place until 2010. 
Revised minimum purchase prices (feed-in) were set at the beginning of 2008. (Cyprus 
intends to introduce additional programmes for the promotion of renewable energy in the future).  
Czech 
Republic Support guaranteed (feed-in tariff) for 15 years from the date a plant became operational (if 
in existence before 2006) and for new plants there is a decrease in the feed-in tariff of 5% 
per annum.   
Denmark Variable bonuses on top of the market pri ce for electricity, guarant eed for 10 years.  
Estonia 12 year mandatory purchase prices (feed-in tariffs).  
Finland Low interest loans granted for up to 10 years.  (New support schemes or the extension of 
existing ones will be re-considered if curren t measures fail to promote electricity from 
renewable energy sources sufficiently).  
France Obligation to buy electricity from renewable ener gy sources at a price fixed higher than the 
market price (feed-in tariff) for 15-20 years. 
Germany Feed-in tariff guaranteed for 20 years (15 year s for large hydro plants and 30 years for 
small hydro plants).  
Greece Feed-in tariff guaranteed for 10 years; th is can be extended by 10 years following a 
producer's unilateral declaration to the responsible operator.  
Hungary Prices (feed-in tariffs) are guaranteed to ensure a return on investment.  
Ireland Feed-in tariff guaranteed for 15 years but for no longer than 2024.  
Italy The solar feed-in tariff is guaranteed for 20  years but ceases to ex ist once 1200 MW have 
been installed.  
Latvia Set prices (feed-in) for electricity from renewable energy sources (apart from hydro over 5 
MW, geothermal and photovoltaic ), guaranteed for 10 years or  until target levels for each 
type renewable energy source are met (target levels are set by the Government annually). 
Wind over 0.25 MW has to compete via tenders.  
Lithuania Feed-in tariff until 2020. The National Energy Strategy commits to introducing green 
certificates or other systems beyond 2020.  
Luxembourg Feed-in tariff for 15-20 years. However, lega l uncertainty about stat e aid matters (recently 
resolved) resulted in little new deployment of renewable electricity.  
Malta Net metering for solar energy systems and one-off grants of 25% for wind and 20% for 
solar. 
The 
Netherlands Fixed prices for 10 years in principle but this time period can be shortened or lengthened 
depending on the type of renewable energy source. The Minister for Economic Affairs sets 
the budget for subsidies annually9. 
Poland Vendors are obliged to purchase all electricity they are offered at a fixed price set by the 
Energy Agency on the basis of the average el ectricity price of the previous year. All 
electricity from renewable energy sources in Poland is eligible. There is no time limit.  
Portugal Guaranteed feed-in tariff for 15 years (12 for wind and 25 for hydro) which expires when 
target levels for renewable electricity are met: 21 GWh for solar and 52 GWh of hydro per annum.  
Romania Annual obligatory quotas until 2012. 
                                                 
9 Although the Netherlands' support scheme does not guarantee long-term investment it should be enough 
to meet its 2010 target. A more stable, long-term support scheme will be needed to meet the 2020 
target.  
 
EN 7   EN Slovak 
Republic Fixed purchasing prices (feed-in) for 12 years. 
Slovenia Feed-in tariffs and a bonus price are available for 5 years in full, they then reduce by 5% 
for a period of 5 years and then by 10% after 10 years. 
Spain  Feed-in tariffs are guaranteed fo r 15-25 years at a fixed price and continue at a lower fixed 
rate thereafter. The bonus paym ent (feed-in premium) is paid for the entire lifetime of the 
system; however depending on th e source of energy and the effi ciency of a plant, the first 
15 to 25 years of operation are awarded higher payments. 
Sweden Electricity certificate system until 2030. 
United 
Kingdom The level of the Renewables Obligation will increase in annual steps from 7.9% in 2007/08 
to 15.4% by 2015. The 2015 level will remain until 2027. 
Source: Member States' 2007 Reports  
Key  Stable support scheme 
  Some aspects of the support scheme weaken the stability of the scheme 
  Considerable uncertainty undermin es the stability of the scheme. 
Although the majority of Member States ha ve long-term targets and guaranteed support 
schemes in place, several countries need to do mo re to ensure that they are providing the best 
environment to facilitate the levels of re newable energy deployment needed. For instance, 
Bulgaria and Cyprus only ha ve guaranteed support scheme s in place until 2010 and 
Romania's support is only guaranteed until 2012. As all Member States have ambitious 2020 
renewable energy targets it would be prudent to  ensure continuity of well designed support 
schemes with a view to reduci ng investor risk and the cost of capital (while maintaining 
compatibility with the State aid rules).  
(Further details on Member States' suppor t schemes are provided in Annex A).  
2.2 Administrative barriers and grid access 
Directive 2001/77/EC requires that  electricity from renewable energy sources has guaranteed 
access to the grid and requires Member States to set rules for sharing a nd bearing the cost of 
various grid investments necessary to integrate it. Member States are also permitted to give priority access to networks.  
COM(2006)848
10 noted that grid connections and extensions needed to be simplified and 
stated that the Commission would " continue to co-operate clos ely with grid authorities, 
European electricity regulators and the renewabl es industry to enable a better integration of 
renewable energy sources into the power grid, with particular attention paid to  the special 
requirements related to much larger deployment  of off-shore wind energy, notably as regards 
cross-border grid connections; " 
SEC(2008)5711 noted that despite the requirement s of Directive 2 001/77/EC, project 
developers still faced different grid-related barr iers, which were mainly related to insufficient 
grid capacity, non-transparent procedures for gr id connection, high connection costs and long 
lead times to obtain authorisation for grid  connection. The Communi cation noted that high 
priority should be given to removing administ rative barriers and improving grid connection 
for renewable energy producers. 
                                                 
10 http://eur-lex.europa.eu/LexUriServ/ site/en/com/2006/com2006_0848en01.pdf  
Communication from the Commission to the Council and the European Parliament: renewable energy 
roadmap: renewable energies in the 21st century: building a more sustainable future.  
11 http://ec.europa.eu/energy/climate_actions/doc/2008_res_working_document_en.pdf  
Commission Staff Working Document: the support of  electricity from renewa ble energy sources. 
Accompanying document to the proposa l for a Directive to the European Parliament and to the Council 
on the promotion of the use of electricity fr om renewable energy sources (COM (2008) 19) 
 
EN 8   EN Commission analysis has also been undertaken  to examine some of the administrative 
procedures that are considered to be potenti al barriers to the development of renewable 
electricity. An examination of the permit regi mes for building renewabl e electricity plants 
highlighted a wide variety of pr actices across Member States. On average, over nine different 
authorities needed to be cont acted. This amount varied accord ing to the Member State, the 
technology in question and sometime s the size of the installation. 
Average number of authorities involved in the building permission procedure 
0510152025303540
Austria
Belgium
Bulgaria
Cyprus
Czech Republic
Denmark
France
Germany
Greece
Hungary
Ireland
Italy
Lithuania
Malta
Poland
Portugal
Slovakia
Spain
Sweden
UKNumber of authorities
0510152025303540
Wind on-shore
Wind off-shore
Biogas
Solid BiomassHydro
Photovoltaics
Geothermal
Tide & Wave
 
Source: "Promotion and growth of renewable energy sources and systems" Final Report, Ecofys et al. p67 
There have been some reforms to the authorisation process in recent years. For example, the 
UK revised its legislation on planning perm ission for projects of national interest12 and the 
Greek government has begun to streamline envir onmental permission procedures by setting 
up two central bodies to coordina te procedures and has limited th e time authorities have to 
grant or deny permits to 6 months. National practices differ, and whilst most informed, 
potential renewable electricity producers believe that the proce dures for licensing are clear; a 
common complaint is the lack of  time limits for responses. This problem appears to have been 
exacerbated by the introduction of tiers of re gional government working in conjunction with 
support schemes or authorising bodies at a nati onal level. Examining the duration of permit 
planning also reveals differences accordi ng to Member States and technologies: 
                                                 
12 Planning Act 2008: http://www.opsi.gov.uk/acts/acts2008/pdf/ukpga_20080029_en.pdf  
 
EN 9   EN Average lead time for overall authoris ation procedure and grid connection 
0102030405060
AustriaBelgium
Bulgaria
Cyprus
Czech Republic
DenmarkFrance
Germany
Greece
Hungary
IrelandItaly
MaltaPolandPortugalSlovakia Spain
SwedenUKLead Time [months]
Lead time for overall procedure
Lead time for grid connection0102030405060
Wind on-shore
Wind off-shore
Biogas
Solid Biomass
Hydro
PhotovoltaicsGeothermal
Tide & Wave
 
Source: "Promotion and growth of renewable energy sources and systems" Final Report, Ecofys et al. p72 
In general, average lead times for grid conne ction were very high representing a significant 
bottleneck. Exceptionally hi gh authorisation proce dure lead times were reported for offshore 
wind developments. 
The uncertainty of the procedure and the time it takes to complete the process compound the 
uncertainty of the overall acceptance or rejection of an application. On this point to there is 
wide variation across Member States but less variation according to technology: 
The average rate of permit rejections. 
0%10%20%30%40%50%60%70%80%90%100%
Austria
Belgium Cyprus
Czech Republic
Denmark
FranceGermany
Greece
Hungary
IrelandMalta
PolandSlovakia
Spain
Sweden UKRate of permit rejections
0102030405060708090100
Wind on-shore
Wind off-shore
Biogas
Solid BiomassHydro
Photovoltaics
Geothermal
 
Source: "Promotion and growth of renewable energy sources and systems" Final Report, Ecofys et al. p74 
The average rate of permit rejection is 30% but in some cases (reflecting ad hoc moratoriums 
on certain technologies in certain regions or countr ies) the rate is much higher. In many cases, 
 
EN 10   EN a lack of grid capacity  represents a crucial factor for re jection. This and ot her reasons (such 
as an excess of applications) suggest that bett er structured administra tive procedures, further 
administrative resources and coordination with grid planning is necessary. For instance, in countries with a high rate of successful planning  appeals, an increase in resources for initial 
applications could speed up the tr eatment of applications, increase the rate of initial approvals 
and reduce the administrative cost s associated with appeals.  
Analysis of the planning process reveals th at problems relating to grid connection and 
capacity are a major obstacle which is more often generated by limits on administrative and 
other resources than te chnological constraints. 
Perceptions of insufficient grid capacity. 
0%10%20%30%40%50%60%70%80%90%100%
Austria
Belgium
Bulgaria
Cyprus
Czech Republic
Denmark
France
Germany
Greece
Hungary
Ireland
Poland
PortugalSpainSwedenUKShare of projects with grid capacity problems
0%10%20%30%40%50%60%70%80%90%100%
Wind on-shore
Wind off-shoreBiogas
Solid Biomass
Hydro
Photovoltaics
Tide & Wave
 
Source: "Promotion and growth of renewable energy sources and systems" Final Report, Ecofys et al. p76 
One important element for ensuring that there is sufficient grid capacity is grid expansion 
financing. One crucial problem is  a lack of clarity regarding cost breakdowns and in some 
Member States there appears to be no transp arency. Also in some Member States grid 
connection and expansion cost s and the charging regimes of some transmission system 
operators and distribution system operators st ill favour incumbent producers and discriminate 
against new often decentralised  smaller renewable electricity  producers. This hampers job 
creation and growth at lo cal and regional level.  
2.3 Guarantees of Origin 
Article 5 of Directive 2001/77/EC  requires that Member States outline the measures taken to 
ensure the reliability of the system they have in place to guarantee the origin of electricity. 
Most Member States have reporte d that they have legislated to create at least the framework 
for the system of guarantees of origin. That sa id, the actual use made of the guarantees of 
origin differs widely across Member States. In  some instances they are used in conjunction 
with green certificate/obligations  support schemes. In most cases they are used by electricity 
suppliers to show their cons umers that they have purchased "green electricity". The 
implementation of the system of guarantees of origin was partly meant to help Member States 
and electricity suppliers fulfil th eir obligations to prove the na ture of the energy mix they 
provide to consumers under Directive 2003/54/EC13. Member States are required to ensure 
                                                 
13 concerning common rules for the internal market for electricity 
 
EN 11   EN that the reporting of energy mix by suppliers  is reliable. However, a forthcoming study 
undertaken for the Commission rais es concerns that whilst legislation might be in place, 
current differences in national schemes and a l ack of standardisation, mutual recognition and 
verification mean that the use of guarantees of origin is not always  reliable, and their role as a 
standard proof of renewable electricity is at times constrained or unrecognised. (See E-
TRACK II, final report due March 2009 http://www.e-track-project.org/ ). This is another 
matter which is being addressed in the new Directive on renewable energy and will be 
followed closely by the Commission.  
2.4 Member State progress towards the 2010 targets 
Each Member State has a target for the amou nt of electricity th ey should produce from 
renewable energy sources by 2010. The table belo w show the effort made so far by each 
Member State. 
Table 2: Electricity  from renewable energy sources: progress towards the 2010 target  
Member 
State Share the 
reference 
year14 Share in 
2004 
(%) Share in 
2006 
(%) Change in 
percentage 
points in shares 
2004-2006 Progress made 
towards target from 
reference year in 
2006 (%) 2010 
target 
(%) 
Austria 69.00 60.94 61.62 0.7 0 78.1 
Belgium 1.06 2.15 3.89 1.7 57.29 6 
Bulgaria 6.37 6.43 6.82 0.4 9.72 11 
Cyprus 0.00 0.00 0.00 0.0 0 6 
Czech Rep 3.47 3.68 4.11 0.4 14.13 8 
Denmark 8.87 27.08 25.93 -1.2 84.75 29 
Estonia 0.26 0.59 1.45 0.9 24.59 5.1 
Finland 26.29 26.79 26.47 -0.3 3.45 31.5 
France 15.62 14.01 14.29 0.3 0 21 
Germany 6.33 10.58 12.59 2.0 +100 12.5 
Greece 7.70 7.59 8.79 1.2 8.79 20.1 
Hungary 0.48 2.28 3.68 1.4 +100 3.6 
Ireland 4.25 5.65 8.57 2.9 48.27 13.2 
Italy 15.52 15.78 18.32 2.5 40.11 22.55 
Latvia 47.48 46.01 40.40 -5.6 0 49.3 
Lithuania 3.56 3.43 3.87 0.4 9.01 7 
Luxembourg 1.21 3.33 3.67 0.3 54.79 5.7 
Malta 0.00 0.00 0.00 0.0 0 5 
Netherlands 3.51 5.71 7.93 2.2 80.51 9 
Poland 1.63 2.19 3.05 0.9 24.19 7.5 
Portugal 32.56 28.56 31.16 2.6 0 39 
Romania 30.66 29.15 28.05 -1.1 0 33 
Slovak Rep 14.49 13.55 16.00 2.5 9.15 31 
Slovenia 29.66 29.37 28.26 -1.1 0 33.6 
Spain  16.45 18.58 19.11 0.5 20.54 29.4 
Sweden 47.99 51.52 52.28 0.8 35.72 60.0 
UK 2.12 3.64 4.63 1.0 31.85 10 
EU27 12.85 14.35 15.72 1.4 35.21 21 
Source: Eurostat (with normalised hydro) 
To reach the 2010 target the EU had to increase the share of electricity from renewable energy 
sources from 13% to 21%. In 2006 it stands at 15.7%, which equates to 35.2% (2.87/8.15) of 
progress needed to reach the 2010 target.  
                                                 
14 Reference year for EU-15 is 1997. Reference year for EU-12, BG and RO is 2000.  
 
EN 12   EN In 2006, Belgium, Denmark Ireland, Luxembourg, The Netherlands, Sweden had made more 
progress towards their 2010 target than the Eur opean average, and Hungary and Germany and 
Hungary had reached their target (or in fact, exceeded it).  
It should be noted that the shar e of electricity from renewabl e energy sources in Austria, 
France, Latvia, Portugal, Romania and Slovenia was lower in 2006 than in the reference year. 
Therefore, these Member States need to do mo re to reverse their downward trends. This is 
particularly true for France which had an annual decrease from 1997-2005.  
In 2006, twenty one  Member States were less than half  way towards meeting their 2010 target 
for electricity from renewable energy sources. Several Member States are unlikely to meet 
their 2010 targets.  
Table 3: The likelihood of Member States m eeting their 2010 electricity from renewable 
energy sources targets.  
 Expect to meet the target? 
Austria 
/ Between 2004 and 2006 electricity consumption increased by 4.7% and electricity from 
renewable energy sources increased by 5.9%. However Austria still has a lower share in 2006 
than it did in 1997. 
Belgium 
. Between 2004-2006 electricity from renewable energy sources increased by over one and a 
half percentage points, and it is over half way towards its target. Belgium expects to have 
6900 GWh of electricity from renewable energy sources in 2010 and 95,670 GWh electricity consumption. This would equate to 7.2% electricity from renewable energy sources, 
exceeding the 6% target.  
Bulgaria 
/ Between 2004 and 2006 electricity from renewa ble energy sources increased by 13% whilst 
total electricity consumption increased by 6. 6%. However, the share of electricity from 
renewable energy sources has risen by less than  half a percentage point and Bulgaria is still 
some way off from its target.  
Cyprus 
/ Cyprus aims to have 6% electricity from renewable energy sources by 2010 (4.5% from 
biomass and 1.5% from phot ovoltaics and some wind power). However in 2006, 0% 
electricity came from renewable energy sources and between 2004 and 2006 Cyprus' final 
electricity consumption increased by 10.7%. Adequate support scheme should be 
implemented urgently together with eliminating administrative barriers to RES-E deployment. 
Czech 
Republic 
/ Transposition of Directive 2001/77/EC has been  slow and short-term, support schemes have 
not provided a stable environment for investment and there are administrative barriers to 
further deployment. Between 2004 and 2006 electricity from renewable energy sources 
increased by 17%, whilst final electricity c onsumption increased by 4.5%, however progress 
towards the target is only 14%.  
Denmark 
☺ Denmark expects to have 33% electricity from renewable energy sources by 2010 (target 
29%). Between 2004-2006 Denmark's electricity from renewable energy sources decreased by 
1.1% whilst electricity consumption increased by 3.3%.  
Estonia 
/ Despite significant increases in the absolute quantity of electricity generated from renewable 
energy sources, growth as a share of total electricity consumption is slow and progress 
towards the target limited.  
Finland 
/ From 1997 to 2006 electricity from renewabl e energy sources fluctuated between 25 and 
27.1% (target 31.5%). Finland's electricity from renewable energy sources grew by 2.1% 
between 2004 and 2006 whilst its electricity consumption grew by 3.3%. Finland will need to 
diversify its renewable energy sources in order to meet its 2010 target.  
France 
/ Between 2004 and 2006 electricity from renewable energy so urces increased by 1.8% whilst 
electricity consumption decreased by 0.24%. Ho wever, with a 2006 share still below that of 
1997, France is a long way from achieving its target.  
Germany 
☺ Germany has passed its 12.5% target. Germany is strongly committed to developing 
electricity from renewable ener gy sources which increased by 20.1% between 2004 and 2006 
whilst electricity consumption grew by 0.89%.  
 
EN 13   EN  
Greece 
/ Between 2004 and 2006 electricity from renewabl e energy sources increased by 21.1% whilst 
electricity consumption grew by  4.5%. In line with earlier es timates, Greece predicts that 
electricity from renewable energy sources will grow, but with less than 10% of the effort 
made towards the target, it seems unlikely that the target will be reached.  
Hungary 
☺ Hungary has already exceeded its 3.6% electric ity from renewable energy sources target (the 
lowest in the EU). Between 2004 and 2006  electricity from rene wable energy sources 
increased by 68.6% whilst final electricity consumption increased by 4.6%. However, it should be noted that the shar e decreased between 2005 and 2006  by 17.1%. More long term 
policies are needed to maintain the 2010 target achievement and to ensure favourable 
conditions for the post 2010 period. 
Ireland 
. Between 2004 and 2006 Ireland's electricity fro m renewable energy sources increased by 
63.5% whilst electricity consumption increased by 7.8%. Ireland expects to meet its 13.2% 
target but must make significant efforts to complete the remaining 53% of progress towards 
the target.  
Italy 
. Between 2004 and 2006 electricity from renewable energy sources increased by 2.5 
percentage points, however it still has to make 60 % of the effort needed to reach its target.  
Latvia 
/ The proportion of electricity from renewable ener gy sources in Latvia is decreasing. Latvia 
will need to do substantially more if it is to m eet its electricity from renewable energy sources 
target.  
Lithuania 
/ Lithuania expects to reach its target, but pr ogress to 2006 has been  slow. The share of 
electricity from renewabl energy sources grew by 0.4 percentage points between 2004 and 
2006, and over 90% of the effort to reach the target remains to be made.  
Luxembourg 
. Uncertainty regarding the feed-in tariff regime and State Aid rules which have only recently 
been resolved, has slowed developments since 2005. Between 2004 and 2006 electricity from 
renewable energy sources increased by 15.8% an d electricity consumption increased by 4.9%. 
Malta 
/ Malta is very unlikely to meet the 2010 target as little attention has been given to electricity 
from renewable energy sources. Between 2004 and 2006 electricity consumption increased by 3.6%. In 2006 the share of electricity from re newable energy sources was still 0%. Malta has 
committed to reviewing and increasing support mechanisms.  
The 
Netherlands 
☺ Between 2004 and 2006 electricity from renewabl e energy sources increased by 42.4% whilst 
electricity consumption grew by 2.5%. Support was frozen in August 2006 creating uncertainty for investors; however the reintroduc tion of support in 2008 should ensure that the 
Netherlands meets its target.  
Poland 
/ Due to increased quota obligations and higher certificate prices, faster growth is expected 
from 2007. However, in 2006 Poland only had 3.1% electricity from renewable energy (24% of the effort needed to reach its 2010 target), with less than once percentage points growth 
between 2004 and 2006. 
Portugal 
/ In 2007 Portugal set a national target of 45% electricity from renewable energy sources by 
2010 (their indicative target is 39%). However the current % is still below the reference year.  
Romania 
/ Between 2004 and 2006, electricity from renewable energy sources increased by 1.7% whilst 
electricity consumption increased by 5.7%. More effort is needed in order to meet the 2010 
target as Romania's share of electric ity from renewable energy sources has decreased  since 
2000.  
Slovakia  
/ Between 2004 and 2006 electricity from renewa ble energy sources increased by 19.5% and 
electricity consumption increased by 1.2% but Slovakia is still some way off the target. New 
tariffs were set in 2008 so progress in 2008 should give better future growth. 
Slovenia 
/ Slovenia will find it difficult to meet the 2010 target without major changes in investment and 
new production capacity in renewable energy sources. Between 2004 and 2006 electricity 
from renewable energy sources increased by 0. 4% whilst electricity consumption increased by 
4.7%; the share of electricity from renewable energy sources decreased.  
 
EN 14   EN  
Spain 
/ Spain expects to exceed its 29% target by 2010.This is based on estimates of 100 TWh of 
electricity from renewable energy sources from a total 337.4 TWh electricity consumption. 
However between 2004 and 2006, electricity from renewable energy sources increased by 
11.3% and electricity consumption increased by 8. 2% - an increase in share of 0.5 percentage 
points, and Spain still needs to make 80% of the efforts to reach the target. That said, Spain 
increased its support for electricity from rene wable energy sources in May 2007 therefore 
2008 data should give stronger future growth and improve the chances of Spain meeting its 
2010 target.  
Sweden 
. . Between 2004 and 2006 electricity from renewa ble energy sources increased by 1.3% and 
electricity consumption decreased by 0.19%. Swed en is on tract to meet its target, but still 
needs to make 65% of the effort. 
United 
Kingdom 
/ Between 2004 and 2006, electricity from renewa ble energy sources increased by 28.6% and 
electricity consumption increased by 1.1%. However the UK still has to make 68% of the 
efforts needed to reach its target. There are si gnificant delays in connecting electricity from 
renewable energy sources to the transmission and distribution network and the UK needs to 
increase the speed of deployment substantially in order to meet the 2010 target. In February 
2008 there were 11GW of capacity in the planning system waiting for consent.  
Source: information from Member States' reports and growth rates based on Eurostat 2006 data (with 
normalised hydro generation).  
Key to "smiley" grades: % of progress from  reference year (1997/2000) to 2010 target  
0-33%  34-66%  67-100+  
/ . ☺ 
 
In 2006, the Commission noted that the EU was not on track to m eet its 21% electricity from 
renewable energy sources target, predicting th at an 18-19% share of electricity from 
renewables sources would be achieved by 2010. This prediction was based on Member States' 
progress against their national i ndicative targets up to 2005.  
The Commission still expects all Member States to bring forward policies in order to meet 
their national indicativ e target. Indeed, given the new ta rgets established for 2020, the 2010 
targets act as a necessary minimum interim s ectoral target. Improvements to national support 
schemes and the ongoing integration of the inte rnal market should facilitate growth of 
renewable electricity but most Member States still need better, active policies to ensure 
growth occurs. 
 
EN 15   EN 3. T HE TRANSPORT SECTOR   
Article 4.2 of the Biofuels Directive states: 
"By 31 December 2006 at the latest and ever y two years thereafter the Commission shall 
draw up an evaluation report for the Europe an Parliament and for the Council on the 
progress made in the use of biofuels and ot her renewable fuels in the Member States. 
This report shall cover at  least the following: 
(a) the cost-effectiveness of the measures ta ken by Member States in order to promote 
the use of biofuels and other renewable fuels; 
(b) the economic aspects and the environmental impact of furt her increasing the share of 
biofuels and other renewable fuels; 
(c) the life-cycle perspective of biofuels and other renewable fuels, with a view to 
indicating possible measures for the future promotion of those fu els that are climate 
and environmentally friendly and that have potential of becoming competitive and 
cost-efficient; 
(d) the sustainability of crops used for the production of biofuels, par ticularly land use, 
degree of intensity of cultivation, cr op rotation and use of pesticides; 
(e) the assessment of the use of biofuels and other renewable fuels wi th respect to their 
differentiating effects on climate c hange and their impact on CO2 emissions 
reduction; 
(f) a review of further more long term options  concerning energy efficiency measures in 
transport." 
It follows that the current repor ting exercise needs to have tw o parts: progress in the use of 
biofuels and other renewable fuels and enviro nmental and economic impacts (points (a) to 
(f)). 
For the first part, the Commission commi ssioned PricewaterhouseCoopers to conduct a 
review of Member States' data. Member Stat es' progress reports under the Directive were 
analysed and a questionnaire was sent to Member  States and stakeholders to collect additional 
data. Based on this work, this working documen t includes new analysis of Member States' 
support schemes for biofuels. 
In preparing the second part, the Commission took account of the fact that the previous (2007) 
progress report focussed partic ularly on economic and environmental impacts. These impacts 
have, in addition, been the subject of extensive discussion as part of the examination of the proposed Renewable Energy Directive. The agreed text of that Directiv e includes extensive 
monitoring and reporting requirements on these topics which will certainly lead to a 
substantial increase in knowledge and understandi ng, as well as sustainability requirements 
which will alter the impacts of the biofuels consumed. For that reason, while this report 
updates the economic and environmental analysis ma de in the last progress report, it does not 
undertake extensive new assessments. 
For all of this discussion it should be noted that "biofuels" is a subset of biomass, referring to 
liquid or gaseous fuel for transport produced from biomass.  
 
EN 16   EN 3.1 Progress in the use of biofue ls and other renewable fuels 
According to Member States' reports, in 2007 8.1 Mtoe (2.6%) of the tota l fuel consumed in 
transport in the EU was from biofuels. In 2007 biodi esel accounted for 6.1 Mtoe or 75% of 
renewable fuels in transport,  of which 26% was imported. Bi oethanol constituted 1.24 Mtoe 
or 15% of renewable fuels in transport of which 31% was imported, the remaining 10% being 
made up from pure vegetable oil consumed in  Germany, Ireland and the Netherlands and 
biogas in Sweden.  
As in the previous period, there was no repor ted consumption of other types of renewable 
energy in transport. (The use of hydrogen fr om any source remains insignificant. A little 
electricity is used in road transport, a part of which could legitimately be attributed to renewable energy, but Member States  preferred to classify this as electricity from renewable 
energy rather than as trans port from renewable energy.)  
Germany, France, Austria, Sweden and UK remain ed the 5 largest biofuel consumers in 2006 
and 2007, consuming 87% and 81% of the total EU biofuels  respectively.  
Table 4: Biofuel consumption and energy share for the EU 27 in 2005 – 2007.  
 Fossil fuel 
(Ktoe) (c) Biodiese
l (Ktoe) Vegetabl
e oil 
(Ktoe) Bio-
ethanol 
(Ktoe) Biofuel 
(Ktoe) Share 
(%) Total fuel 
(Ktoe) 
2005(a) 292876  2277 182.4 552 3011 1.02  295901 
2006 303125  4082 648 881 5611 1.82  308751 
2007(b) 306295  6091 768 1246 8105 2.58  314400 
(a) EU 25 
(b) Cyprus and Finland's biofuel data is missing. Biofuel data  for Belgium, Bulgaria, Czech Republic, Denmark, Germany, 
Greece, Hungary, Luxembourg, Poland, Portugal, Slovaki a and Spain are taken from EurObserver's Biofuel 
Barometer15. 
(c) Fossil fuel data corrected with the last 6 year trend from Eurostat data on fossil fuel cons umption in the transport sector  
where missing.  
(d) Sweden consumed 13 .7 Ktoe of biogas in 2005, 14.6 Ktoe in 2006 and 24.07 Ktoe in 2007.  
The following table shows deve lopments in the share of domestically produced biofuel 
between 2005 and 2007. 
Table 5: Biofuel self-sufficiency in the EU27 (ratio of production to consumption in %). 
Biodiesel sufficiency ratio  Bioethanol sufficiency ratio Biofuel sufficiency ratio 
2005 2006 2007 2005 2006 2007 2005 2006 2007 
114 91 74 83 91 70 109 91 73 
Note: 100% implies full self sufficiency; a higher figure implies potential for export of biofuels; and a lower 
figure means that some or all of biofuel consumption in a given Member State is met by imports.  
Source: Source: PwC based on Member States' Report s, EBB and EBio (producer data) and EurObserver's 
Biofuel Barometer 
It can be seen that the share of domestic biod iesel production, in particular, has been falling 
(and it can be expected that this trend conti nued in 2008). The overall balance for biodiesel 
changed from positive in 2005 with 14% (355 Ktoe) exported to negative in 2007 with 25.8% (1.8 Mtoe) imported. During the sa me period, the bioethanol defi cit increased from 17% (171 
Ktoe) in 2005 to 31% (397 Ktoe) in 2007.  
The main reason for the change was the increasing market share of competitively priced 
biofuel for import, mainly soy oil methyl es ter (SME B-99.9) from the United States and 
                                                
 
15 Biofuels Barometer, EurObserv'ER 49, June 2008 
 
EN 17   EN Argentina. The EU's estimated import of SME B-99.9 in 2007 was 1 million tonnes, up from 
90,000 in 2005. In both the US and Argentina, i ndustry mainly serves the export market. The 
European Commission started a formal anti-du mping investigation in June 2008, which could 
lead to the imposition of punitive tariffs on SME B-99.9 imports from the United States. Initial findings are expected in mid-March 2009. 
 
To meet the national targets that Member States  have set themselves under the Directive, the 
consumption of biofuel and other renewable fu els would need to more than double over the 
next two years. Assuming that in 2010 the increas e in fuel for transportation was the same as 
in 2000-2006 for each Member State and the ratio between bioethanol and biodiesel remained 
the same as the average observed in 2005-2007, th e additional biofuel consumption would be 
approximately 10 Mtoe (7.8 Mtoe biodiesel and 2.8 Mtoe bioethanol). The additional 
estimated biofuel required in each Member  State is indicated in the Table 6. 
Table 6: Estimation of the additional biof uel needed to reach national targets in 2010 
(Ktoe). 
  Annual rate 
of variation of 
the fuel 
consumption 
in the 
transport 
sector  Estimated 
need of 
Fuel for 
the road 
transport 
sector in 
2010 
(KToe)  2010 target 
share 
(national 
target as 
notified to 
Commission) Estimation 
Additional 
biofuel 
needed in 
2010 in 
KToe Estimation 
Additional 
biodiesel 
needed in 
2010 in 
KToe Estimation 
Additional 
bioethanol 
needed in 
2010 in 
KToe 
Austria 3.65 9335 5.75 176 171 4 
Belgium (E) -0.14 8414 5.75 393 393 0 
Bulgaria (E) 7.02 2725 5.75 44 20 24 
Cyprus 1.37 1080 2.50 27 23 4 
Czech Rep. 
(E) 6.03 7787 5.75 415 414 1 
Denmark 
(E) 2.03 4555 5.75 256 0 256 
Estonia 5.26 1050 5.75 60 50 10 
Finland 1.77 4328 5.75    
France -0.24 41571 7.00 1486 1192 294 
Germany -0.75 50006 6.25 -868 -799 -69 
Greece (E) 2.76 7114 5.75 329 329 0 
Hungary (E) 6.17 5430 5.75 303 4 299 
Ireland 4.92 5303 5.75 284 263 21 
Italy 1.09 40827 5.75 2171 2171 0 
Latvia 7.45 1360 5.75 76 60 17 
Lithuania 5.98 1420 5.75 14 9 5 
Luxembourg 
(E) 5.35 2757 5.75 124 121 3 
Malta 3.49 166 5.75 8 8 0 
Poland 1.99 11153 5.75 563 231 332 
Portugal 6.61 8900 5.75 345 345 0 
Romania 1.43 5868 5.75 293 293 0 
Slovakia 3.75 2208 5.75 74 62 12 
Slovenia 3.76 1792 5.00 76 73 3 
Spain (E) 2.90 36284 5.75 1713 854 859 
Sweden 3.55 8259 5.75 108 33 75 
The 
Netherlands 0.84 10972 5.75 386 230 156 
UK 1.17 41596 5.00 1731 1246 484 
EU 27  322259  10585 7794 2791 
 
EN 18   EN Source: Member States' reports on biofuel and from EUROSTAT data on fuel consumption from road transport 
3.2. Support schemes 
This section analyses the different measures taken by Member States to promote the use of 
renewable fuels in transport. Across the EU there are both general support measures and specific support measures which appl y to certain producers or users.  
General support measures 
Tax relief and obligations to blend are the two most common instruments
16 used by Member 
States to promote biofuels, with important developments having taken place over the last two years. In 2005-2006 all Member States , except Finland, used tax exemptions
 as the main 
support measure, while obligations to blend we re only used by 3 countri es (Austria, France 
and Slovakia). Since 2007, more than half of  Member States (Austria, Cyprus, Czech 
Republic, France, Germany, Italy, Lithuania,  Luxembourg, Portugal, Romania, Slovakia, 
Slovenia, Spain, Sweden, The Netherlands and United Kingdom) have ad opted obligations to 
blend. In most cases, an obligati on to blend was combined with pa rtial but increasing levels of 
taxation (i.e. Austria and Greece for ethanol a nd Luxembourg and Portugal for biodiesel) or 
unchanged levels of taxation17 (i.e. The Netherlands).  
Some countries utilise a quota mechanism (Bel gium, France, Italy, Ireland and Portugal) 
where the amount of biofuel benefiting from s upport is shared amongst different suppliers 
through calls for tender. This mechanism allo ws Governments to decide the amount of 
biofuels that has to be supplied each year, thus creating some regul ation of the market.  
Introducing obligations to blend in addition to  existing tax relief has boosted biofuel growth 
in many Member States, leading to considerab le progress towards 5.75% target. For example, 
the introduction of compulsory blending in 2007 led to  a rapidly increasing share of biofuels 
in the Netherlands from 0.3% in 2006 to 2% in 2007. Some Member Stat es claim that their 
obligations are not yet legally enforceable and therefore have not yet a strong influence on the 
market. They therefore maintain other support mechanism in parallel to the obligations. 
                                                 
16 Surveys of policies aiming at developing biofuel industry and consumption are common. The most 
comprehensive are the reports by PREMIA, ECN,  Kutas-Lindberg-Steenblik (KLS, by IISD of 
Geneve), OECD and two of Intelligent Energy Euro pe, i.e. Refuel and Biodiesel Chains (BC), plus  
notifications of State Aid to the Co mmission. KLS and BC (albei t only referring to biodiesel) reports are very 
detailed. These sources, cont aining useful information about policies a nd instruments sometimes not available in 
the Member States' Reports, have been tapped on to integr ate the information of the Member States' reports, which 
remain the most important source of information . [Please give complete references for all sources] 
17 In United Kingdom the level of rebate is fixed up to 2010 (20 pence/litre).  
 
EN 19   EN The following table summarises different biof uel support measures used by Member States. 
Table 8: General support measures: tax relief and obligations to blend.  
MS 
reports Country Period Tax relieves Timing referenceObligation to 
mixtureNational 
percentage share on the total EU 27 conventional fuels 2007National 
percentage share on the total EU 27 all biofuels 2007
2008
Austria 2005-2006 x jan05-june07 x oct05-oct08 2.7 4.5
2007-2008 x ↑from july07(BD)-
oct07(BE) x(yearly increasing obligations, up 
to 5,75%, already reached)
2007 Belgium 2005-2006 x from nov06 2.8 1.1
2007-2008 x
2007 Bulgaria 2005-2006 0.7 1.4
2007-2008 x from jun07
2007 Cyprus 2005-2006 0.3n.a
2007-2008 x from 2007 to 2010 xfrom 2007 to 2010 (increase up to 
2008, after the same at 2%)
2007Czech Rep
ublic 2005-2006 x dec05-dec062.1
0.4
2007-2008 only pure ↓ from Jan 2007 x 2007 to jan 2009 (yearly 
incr.obligations, up to 4 %)
2007 Denmark 2005-2006 x from Jan 2005 1.4 0.1
2007-2008 x
2008 Estonia 2005-2006 x 2005-2011 0.3 0.0
2007-2008 x
2007 Finland 2005-2006 1.3 0.0
2007-2008 x tradingfrom jan 2008 (yearly 
incr.obligations, up to 5,75 % in 
2010)
2008France
2005-2006 xBy yearly Finance 
Laws TGAP x13.3
17.6
2007-2008 x ↓ TGAPyearly increasing obligations, up to 
7 % in 2010
2007Germany  
2005-2006 x From 2004 to nov 0516.7
49.5
2007-2008 x tradingyearly increasing obligations: 6,75 
% in 2010, 8% in 2015
2008 Greece 2005-2006 x 2.1 1.0
2007-2008 xfrom 1jan08 no 
exemption
2007 Hungary 2005-2006 x 1.5 0.1
2007-2008 x
2008 Ireland 2005-2006 x from 2006 to 2010 1.2 0.3
2007-2008 xIt is proposed to introduce 
obligation in 2010
2008 Italy 2005-2006 x from April 2006 12.5 2.2
2007-2008 x from 2007 to 2010 x tradingyearly increasing obligations (1% 
in 07, 2% in 08, up to 5,75 % in 2010)
2008 Latvia 2005-2006 x 0.4 0.0
2007-2008 x from jan 2007
2008 Lithuania 2005-2006 x from 2001 x 0.5 0.8
2007-2008 x x
2007Luxembou
rg 2005-2006 x in 20060.8
0.4
2007-2008 x budget Law for 2007
2008 Malta 2005-2006 x from 2004 0.0 0.0
2007-2008 x
2007 Poland 2005-2006 x Apr 2004 - dec 06 3.4 1.2
2007-2008 x↑ from May 2007
2007 Portugal 2005-2006 x From March 2006 2.4 2.0
2007-2008 x x not quantified
2008 Romania 2005-2006 1.8 0.5
2007-2008 x From May 2007 x (indicative ?)
2007 Slovakia 2005-2006 x From May 2006 x From May 2006 0.6 0.2
2007-2008 x x
2008 Slovenia 2005-2006 x from 1998 x starting from 2006 0.5 0.2
2007-2008 x xYearly increasing obligations (up 
to at least 5 % in 2010) till 2015
2007 Spain 2005-2006 x From 2003 to 2012 10.9 4.6
2007-2008 xfrom 2009, yearly increasing 
obligations (up to  5,83 % in 2010) 
2008Sweden
2005-2006 xExemption from CO2 
tax xFrom April 2006 obligation for larger filling stations 2.5
4.5
2007-2008 x x
2008The Nether
lands 2005-2006 x Detaxation in 20064.0
3.0
2007-2008 x xYearly increasing obligations (up 
to  5,75 % in 2010) 
2008United 
Kingdom 2005-2006 xFrom jan 2002 to dec 
201213.1
4.3
2007-2008 x x tradingFrom Apr 2008 (yearly increasing 
up to 5 % in 2010/11)
EU - 27 100.0 100.0
Source: MSs Reports; EBB, Biodiesel Chains (IEE); web news  
 
EN 20   EN It is hard to assess which general instrument  is more successful in increasing demand for 
biofuels as many factors other that policy measures influence the dynamics of consumption. 
The next table attempts to provide some an alysis by putting together the data on support 
measures and overall consumption trends. Due to lack of data, only an analysis of biodiesel 
could be provided.  
Table 9: Evolution of the bi odiesel consumption in presence of different measures. 
Growth rate Growth rate
2006-2005/ 2007-2006/
2006 vs 2005 2005 2007 vs 2006 2006
%%
AustriaFrom tax relieves in 2005  to both 
measures (+ 8,8) in 2006 72.2Always both: tax relieves and obligations to blend 
(+ 2,1) 14.7
Belgium no consumption in 2005 and 2006 Always tax relieves (+ 3,8)
Bulgaria 
Cyprus no consumption no consumption
Czech Rep. Always tax relieves (+ 1) 89.3From tax relieves in 2006 to obligations to blend (+ 
0,3) in 2007 19.9
Denmark no consumption no consumption
Estonia no consumption no consumption
Finland no consumption no consumption
FranceAlways both: tax relieves and obligations to 
blend (+ 9,7) 41.6Always both: tax relieves and obligations to blend 
(+ 24,8) 51.5
Germany Always tax relieves (+ 58,2) 43.8From tax relieves in 2006 to obligations to blend (+ 
22,6) in 2007 14.6
Greece From no measure in 2005 to tax relieves (+ 
2) in 2006 100 Always tax relieves (+ 1,4) 41.1
Hungary no consumption no consumptionIreland Always tax relieves (0) Always tax relieves (+ 0,8)
ItalyFrom no measure in 2005 to tax relieves 
(0) in 2006From tax relieves in 2006 to obligations to blend 
(0) in 2007
Latvia Always tax relieves (0) Always tax relieves (+ 0,1)
LithuaniaFrom tax relieves in 2005 to both measures 
(+ 0,3) in 2006 50.7Always both: tax relieves and obligations to blend  
(+ 1,2) 67.0
Luxembourg no consumptionFrom tax relieves in 2006 to obligations to blend (+ 
1,4) in 2007
Malta no consumption Always tax relieves (0,1)
Poland From no measure in 2005 to tax relieves (+ 
1) in 2006 99.8 Always tax relieves (-1)
Portugal From no measure in 2005 to tax relieves (+ 
3) in 2006From tax relieves in 2006 to both measures (+ 3,7) 
in 2007 55.3
Romania
Slovakia From no measure in 2005 to both 
measures (+ 0,6) in 2006Always both: tax relieves and obligations to blend  
(-0,6)
SloveniaFrom tax relieves in 2005 to both measures 
(0) in 2007Always both: tax relieves and obligations to blend 
(+ 0,4)
Spain Always tax relieves (+ 1,3) 57.1 Always tax relieves (10,9) 78.7
SwedenFrom tax relieves in 2005 to both measures 
(+ 1,8) in 2006 83.3Always both: tax relieves and obligations to blend 
(+ 4,6) 68.3
The NetherlandsFrom no measure in 2005 to tax relieves (+ 
0,6) in 2006 85.5From tax relieves in 2006 to both measures (+ 6,2) 
in 2007 88.9
UK Always tax relieves (+ 4,5) 80.5 Always tax relieves (+ 11,4) 51.0
Notes: the figure in brackets represents the absolute variation (in PJ) 
Source: PwC based on Member States' Reports and EurObserver's Biofuel Barometer 
An assessment of the absolute annual change in the consumption of biodiesel for each 
Member State18 (2006 compared to 2005 and 2007 comp ared 2006) identified two main 
policy combinations: 
(a) Adoption of a simple tax relief having had no support measure in the previous year 
(only applicable for 2005-2006) : this approach was adopted  by countries with little 
practical experience in biofuels (such as Greece, Portugal, Ital y); countries with 
experience of a more directly  supported approach through  funds (such as Poland); 
and countries taking a more cautious approa ch (such as the Netherlands). There was 
little increase in biofuel cons umption due to a decrease in indirect taxes in countries 
                                                 
18 The assessment excludes non consuming count ries (plus Italy, for which there is inconsistency among 
figures). 
 
EN 21   EN with either no empirical hab it or in countries accustomed to more incisive systems of 
support.  
(b) Adoption of a tax exemption and an obligation to blend having had no support 
measure in the previous year; or adoption of both measures together, replacing just a 
tax relief.  
Specific support measures 
In addition to general support measures, some  Member States also provide support for 
biofuels through specific measures . These policy instruments, incl uding subsidies, often apply 
to either the production or the c onsumption phase of biofuels.  
The production phase includes measures relating to  agriculture such as the production of feed 
stocks and to industry where ne cessary operations to achieve th e intermediate and finished 
product are carried out19. The consumption phase includes meas ures relating to distribution of 
biofuels; the purchase and maintenance of cars a nd vehicles utilizing biofuels; attempts to 
increase the demand for biofuels through “g reen” public procuremen t; and campaigns to 
increase public awareness. The following tabl e summarises the Member State's different 
specific support measures20. 
                                                 
19 Before possible blending with oil products such as fu el (as biofuels can also be utilised pure, according 
to the kind of vehicles which use them), or even as an additive or lubricant. Th is sub-item also includes 
the blending phase (where tec hnically there are no specific fi nancial interventions, apart from 
government policies which change the required percentage for blending).  
20 Policies for R&D are not considered in this section as they aim to influence the paths of technology, 
production and consumption of biofuels in the future, while this section focuses on policies referring to 
contemporaneous production and consumption. Of course, given the importance of R&D policies for 
biofuels of 2nd generation, they are considered later in the report.  
 
EN 22   EN Table 10: Support measures to specific  sectors applied by Member States.  
Measures for 
farmers, other than set aside or energy crops Industry DistributionPurchase / 
maintenance of carsGreen public 
procurement
2008 Austria 2006 x (1)
2007 x (1)
2007 Belgium 2006 x   (2) x (3) x
2007 x   (2) x (3) x
2007 Bulgaria 2006
2007
2007 Cyprus 2006 xx   ( 4 )
2007
2007Czech Rep
ublic 2006 x
2007
2007 Denmark 2006 xx
2007
2008 Estonia 2006 xx
2007
2007 Finland 2006
2007
2008 France 20062007
2007
Germany  2006
2007
2008 Greece 2006 x
2007 x
2007 Hungary 20062007
2008
Ireland 2006 x xx
2007 x
2008 Italy 2006
2007
2008 Latvia 2006 x
2007 x
2008 Lithuania 2006 x x
2007 x
2007Luxembou
rg 2006 x
2007
2008 Malta 2006 x
2007
2007 Poland 2006 x xx x
2007 x
2007 Portugal 2006 x
2007
2008 Romania 20062007
2007
Slovakia 20062007
2008
Slovenia 2006
2007
2007 Spain 20062007
2008
Sweden 2006 xx
2007 x
2008The Nether
lands 2006
2007
2008United 
Kingdom 2006 x
2007
(1)
(2)
(3)
(4)According to a decree of May 11th 2006 car manufacturers are obliged to give detailed information to consumers of passenger car s. 
It includes the possibility to indicate if the car is warranted for biofuel use or not
The investment support for farmers under the the Flemish Agricultur al Investment Fund refers to installations for the productio n of 
renewable energy sources.However it does not include production of biodiesel or bioethanol.
City of Brussels has installed 4 own tanks for storage for biofuels.
Tax relief (up to 1200 euro) for the cost of purchasing a new flexible fuel vehicle. It is aimed at the owners of captive fleet s.  
 
Source: PwC based on MS reports 
Agriculture  
 
EN 23   EN In 2006 and 2007, most of the domestic production of  biofuels is estimated to come from set-
aside areas and areas with energy crop aid21. In addition, EU farmer s produce a considerable 
amount of feedstocks for biofue ls outside any specific aid sc heme related to non-food or 
energy production.  
Table 11: Areas of energy crops within the energy crop aid and set aside scheme (mio 
ha) 
 2004  2005  2006  2007  
Total non food land use on set-aside area 0.5  0.9  1  1  
Energy crop aid 0.3  0.6  1.3  2.8  
Source: European Commission. DG-AGRI 
From 2004, in order to enhance the producti on of raw materials for energy production, 
farmers have been eligible for the energy crop s aid introduced within the framework of the 
direct payment support. Those cr ops are supplied e ssentially for the pr oduction of biofuels 
and electric and thermal energy. The amount of aid (45€/ha) is now granted for a maximum 
guaranteed area of 2 million hectares. When the claimed area exceeds maximum guaranteed 
area, a reduction coefficient is established in order to respec t budgetary ceiling. This was the 
case of the year 2007. According to the CAP hea lth check, this aid will be abolished from 
2010, as the premium has been e ffective only in very limited ci rcumstances and has not been 
an incentive for production22. 
In addition, farmers were allowed to cultivat e energy crops as well as  other non-food crops on 
the land set-aside as an exemption from general set-aside obligation23. Under this provision it 
had to be ensured that raw materials harvested were not primarily used for human and animal 
consumption. Around 1 million hectares of such land was cultivated in the EU for energy 
purposes in the period 2005-2007. Ho wever, in 2008 the set-aside obligation was set to 0% as 
a response to the high commodity prices in 2007/2008. From 2009 co mpulsory set aside 
scheme is repealed as a part of Health chec k, as the CAP is completing its move away from 
steering agricultu ral production.  
Apart from these two market instruments, the CAP supports bio-energy including the 
production and use of biofuels on and near farm s through its Rural Development Policy. The 
Health Check increases funds av ailable to address the new cha llenges, of which bioenergy is 
one, by 3.2 billion Euros in 2010 to 2013. 
Industry 
Industry support measures mainly  relate to the localised tran sformation of the agro-industry. 
In Cyprus, a grant scheme (which can reach 40% or up to €680,000) finances investments for the production of biofuels for transport. In Latvia support of around €271 per 1,000 litres is 
given to biodiesel producers up until 2010. In Lithuania an aid scheme entitled “Aid for the 
Development of Production of Biodiesel” prom otes the use of biodiesel for 6 years; 
manufacturers of rapeseed oil for the production of RME may benefit from  direct aid and the 
overall budget is around €34 million. In Poland the “Long Term Biofuel Promotion Project 2008-2014” is perhaps the most interesting, as it  tries to improve the competitiveness of the 
                                                
 
21 Comparison among years should be cautious: 2004/2005 refers to EU 15, 2006 includes EU 25, 2007 
tries to estimate the whole EU 27 supply.  
22 Impact Assessment, COM(2008) 306 final  
23 Set-aside scheme has never been applied in new Member States using single area payment scheme 
(SAPS). 
 
EN 24   EN entire biofuel industry chain: cultivation, production,  distribution and end-use (one of the 
measures is corporation tax relief for industry). 
Leaving aside the contributions that many governments make to small and medium 
enterprises operating in poor regi ons or in rural areas, some ai d is provided through regional 
entities. For example, in the United Kingdom the Scottish Executive and the Regional Development Agencies offer support to operators in the biofuels sector. 
Support measures for the distribution
 sector are provided in a few cases such as in Sweden 
and the UK. As the Swedish Government relies on the largest filling stations respecting the obligation to blend, a subsidy of up to 30% of investment costs relating to the obligation to 
provide renewable fuels (under Act 2005: 1248) has been introdu ced. (However. this subsidy 
may not exceed the investment cost minus the lowe st cost needed to fulfil the requirement). In 
the UK, the Refuelling Infrastructure Grant Programme, managed by the Energy Saving Trust, provides grants for installing alternativ e refuelling points, including biofuels (but not 
exclusively). According to the most recent Report (1 July 2008), the programme has assisted 18 bioethanol (E85) refuelling stati ons and one E95 bioethanol station. 
Interventions are adopted in different Member States to help purchas e and maintain specific 
cars able to utilise a higher biofuels content than the one accepted by car manufactures. In 
Cyprus there is a tax relief of €1,200 towards th e cost of purchasing a new flexible fuel 
vehicle (including electric and hybrid vehicles).  This measure aims to encourage the use of 
biofuels in captive fleets, espe cially where fleet owners can produce biofuels from their own 
resources. The Irish Government has introdu ced Vehicle Registration Tax (VRT) Relief for 
hybrid, flexible fuel and electric cars. This is in addition to lower rate s of VRT for cars with 
lower emissions and will last until 31 December 2010. At the end April 2008 2,836 flexible 
fuel vehicles had been sold in the market. Ma ybe the most successful pu rchase policy is that 
of Sweden where an eco-friendly car sales policy offers lower taxes and subsidises eco-
friendly cars24 purchased by private individuals. A nyone who bought a new eco-friendly car 
since April 2007 is entitled to a subsidy of SEK 10,000 (€ 93825). As a result, the proportion 
of eco-friendly cars among new car sales increased from 5% in 2005 to almost 30% in 2008.  
Public procurement  programmes and programmes to raise public awareness are common in 
many countries. However, they generate few “cl ean” vehicles and often no room is left to 
purchase biofuels through con tinuative long-term contracts. Of course, they are only for 
demonstration purposes, as the size  of the purchase is too small to provide a substantial outlet 
for the production of biofuels a nd is too small to trigger economi es of scale in the industry.  
However, more active policies are pursued in Sweden and Poland. In Sweden from 2007, 85% 
of cars purchased or leased by state authorities  must be eco-friendly and in Poland the “Long 
Term Biofuel Promotion Project 2008-2014” re quires government departments to gradually 
replace their fleets with vehicles able to use liquid biofuels. Recognising the potential of 
public procurement as a stimulus for clean vehicle deployment, the Commission proposed a 
Directive on the Promotion of Clean and Energy Efficient Road Transport Vehicles. This was 
adopted by the European Counc il and the Parliament  during the month of October 2008. The 
Directive will shortly enter into force and will require public authorities to introduce energy 
consumption, CO 2 and pollutant emissions as manda tory award criteria into public 
procurement of vehicles. It applies to public authorities and publicly  owned undertakings and 
to undertakings running public pa ssenger transport services. As a result, not only the initial 
                                                 
24 This policy is applied to fuel efficient cars with CO2 emissions of no more than 120 g/km and vehicles 
that can run on alternative fuels, including biofuels. 
25 Currency conversion on 7 January 2009 
 
EN 25   EN first cost of a vehicle, but also the impact it creates during its lifetime on the environment, will 
be reflected in purchase decisions. Flexibility is  provided for local authorities on the detailed 
implementation. 
Support policy costs 
Most of the measures Member States have adopted have imposed costs on governments and 
to a lesser extent on vehicle manufacturers, fu els distributors and c onsumers. The following 
table attempts to compare the costs and bene fits of the two most common general support 
measures: tax exemptions and obligations to blend. 
Table 12: Comparison of the costs and benefi ts of tax exemptions and obligations to 
blend.  
Policy measures Strengths Weaknesses 
Tax exemptions 
(production increases 
according to variations in 
relative prices) • Easy to implement; 
• Few market risks; 
• Incentive for innovation; 
• Suitable for the early stages of 
development • Loss of fiscal revenues; 
• Risks of overcompensation (if 
high tax reduction); 
• Strongly dependent on the initial 
levels of the excise tax: it is 
effective where these levels are 
high 
Blending obligations 
(the produce increases 
independently from 
variations in relative prices) • It injects certainty into the 
agricultural sector; (unless the 
subsequent increase in prices 
significantly penalises the agricultural supply) 
• It does not involve additional costs 
for public budget; 
• Suitable for the more advanced 
stages of development • Higher prices for consumers; 
• Less incentive to innovate; 
• Higher prices variability; 
• Difficult to implement and 
monitor 
Source: PwC based on MS reports 
It should be noted that in Ta ble 12 the policy measures have b een treated as alternatives for 
easier analysis. However, very  often they are implemented simultaneously and therefore 
interact with each other: incr easing the overall effectiveness. Obligations alone involve higher 
fuel prices at the pump, but at the same time  they give certainty to  investors and industry, 
while guaranteeing the achievement of the target . Excise tax exemptions are then introduced 
to compensate (in part or totally) the extra co sts of biofuels, hence l eaving the final price at 
the pump unchanged. Conversely, excise exemp tions alone would keep prices at the pump 
lower, but they would not guarantee the achieve ment of the desired objectives (both in terms 
of percentage of blending and reduced CO2 emissions).  
A tax exemption reduces fiscal revenues; and as a consequence, lower public resources are 
available for transfers and services. This loss  could be either part-compensated or over-
compensated by the global social benefits (i .e. positive externality) of lower greenhouse gas 
emissions. 
In addition to the possible increase in the price of fuel for motorists (an increase which has 
been partially offset in some  countries like France and Swed en due to duty exemptions and 
other income support measures) the lower en ergy content of biofuels compared to 
conventional fuels (the energy factor) should be factored in. According to the UK Department 
 
EN 26   EN for Transport, the implementation of the Renewable Transport Fuel Obligation26 in the UK 
would bring about an additional annua l disbursement of £15-20 (circa € 16-2227) and £4-5 
(circa € 4-528) for petrol cars and dies el cars respectively, travel ling an annual distance of 
9,000 miles (circa 14,500 kilometres), due to the accr ued amount of fuel needed to travel the 
same distance as compared to a conventional fu el-propelled car. The additional disbursement 
for motorists is expected to vary from country to country within the EU depending on which biofuel has a deeper penetrati on in each Member States' market  and the actual percentage of 
blending. 
Conclusion 
As Table 13 shows, having both an obligation to  blend and a tax relief in combination seems 
to be the most successful measure for achieving  a significant increase in the consumption of 
biofuels. However, at this ini tial stage, it should be monitore d over the next years that the 
combination of the obligation and tax re lief does not lead to overcompensation. 
Table 13: Average annual progress linked to different approaches. 
Shift in the measures used to support biofuels: Average annual growth rate of 
biofuels (%) 
Replacing a tax relief system with an obligation to blend and a tax relief. 70 
Remaining with just a tax relief. 63 
Remaining with both measures (tax relief and obligation to blend).  49 
Replacing a tax relief system with just an obligation to blend.  36 
Source: PwC based on MS reports 
                                                 
26 http://www.dft.gov.uk/pgr /roads/environment/rtfo/ 
27 Currency conversion on 7 January 2009 
28 ibid 
 
EN 27   EN 3.3. Economic impacts 
The following economic impacts are covered: 
- costs; - security of supply; - employment and GDP impacts; - development and external relations; - research and innovation. 
Costs 
The biofuels progress report of 2007 estimated the cost (compared to fossil fuels) of a 7% or 
14% share of biofuels under various framework conditions. 
Estimates of the cost of a 10% share can be de rived from these figures. These show that the 
extra annual cost of this biofuel use in 2020 can be estimated at €8.8-11.2bn (with oil at 
$48/barrel) or at €4.3-7.6bn (w ith oil at $70/barrel). 
These figures are based on data from th e authoritative JEC well-to-wheels study
29. Updated 
cost figures from this source are expected soon  but are not expected to  indicate a dramatic 
change in the picture. 
These data show how critically the cost of bi ofuel promotion depends on commodity prices. 
Even though 2008 saw record high  oil prices, at times reachi ng 140$/barrel, preference here 
has been given to more conservative oil pri ce assumptions. The same goes for agricultural 
commodity prices which also reached high leve ls in spring 2008, but have since gone down.  
Overall, the introduction of biofuels remains more costly than other CO 2-abatement 
technologies in other sectors, but with today' s technologies it still remains one of the few 
available solutions to curb the growing CO2 emi ssions of the transport se ctor. It is essential 
for further technology development to aim to  reduce the production costs of biofuels. 
Security of supply 
Security of supply has been one of the two pr incipal reasons for adopting the EU targets for 
renewable energy use in transport, alongside the greenhouse gas benefits. Presently, about 
88% of the global energy mix comes from deplet ing fuels and, with the exception of the 
nuclear energy (6%), all are carbon-rich fossil fuel s such as oil (35%), natural gas (21%), and 
coal (26%) (World Energy Statistics 2008, Internationa l Energy Agency (IEA)).  
Based on the data provided in Member States' re ports, in 2007 the use of  biofuels in the EU 
replaced 1593.1 million litres  of petrol and 7729.9 million litres of diesel. Currently  that 
represents less than 3% of the total EU fuel consumption in road transport. The target for renewable energy in transport in 2010 has been  set at the level of 5.75%, but with the new 
Renewable energy policy framework it will raise to 10% in the next decade.  
Several studies have estimated that from a stri ct supply-security perspe ctive, increasing global 
demand for biofuels could reduce crude oil prices  slightly. Banse et al . (2008) estimated that 
under an "increased global biof uel" scenario (with a 10% bi ofuel target in the EU and 
comparable targets in the US, Brazil, South Af rica, China, India and Japan), the crude oil 
                                                
 
29 Well-to-Wheels analysis of future au tomotive fuels and powertrains in the Eu ropean context, WELL-to-WHEELS Report: 
http://ies.jrc.ec.europa.eu/WTW  
 
EN 28   EN price would decline by 1.5 per cent.30 Similarly, Dixon et al. (2007) estimated a decline in the 
world crude oil price of 4.5 per cent due to US biofuel policies31.  
Employment and GDP 
According to JRC (2007)32, achieving the EU's 2020 10% renewable transport fuel target 
would create additional employment estimated at €1.8 billion in distributed salaries over the 
2007- 2020 period. 
The development of the biofuels industry will mostly benefit rural areas. The Commission 
estimated in its previous  biofuels progress report33 that a 10% biofuels market share produced 
from home grown feedstock would lead to a net increase in the EU  of 150.000 jobs and an 
increase in EU GDP of at least € 25 billion, equal to 0.17% of current GDP.34 
The ongoing "EmployRES" study, commissioned by the Commission, has found that among 
all renewable energy technologies  the largest employers in th e EU were the biomass and 
biofuels sectors (data on 2005)35. Out of a total 1.4 million people employed in the renewable 
energy sector, non-grid biomass use account s for 600,000 employees, biomass grid and 
biofuels contributed over 100,000 employees an d biogas around 40,000. This is because the 
biomass and biofuel sectors are more labou r intensive than other renewable energy 
technologies. In addition, agricu lture and forestry play an impo rtant role in supplying the fuel 
for biomass technologies. Agri cultural activity related to the renewable energy sector 
generates gross value added of  well over €9bn per year. The value added from increased 
renewable fuel use was estimated at around €14 .6 billion in 2005 and th e value added of the 
renewable energy sector overa ll is around €57 billion in 2005 or 0.5% of total EU-27 GDP 
A recent UNEP and ILO report: Green Jobs36 estimated that in 2007 the total world 
investment in renewable energy reached $66 billion, equivalent to 18% of all energy 
investment and could reach $343 billion by 2020. These investments would translate into at 
least 20 million additional jobs world-wide; a large proportion in biomass and biofuels, 
including jobs in developing coun tries. This would make the se ctor a much larger source of 
employment than today's fossil energy industr y (mining. petroleum ex traction. refining and 
fossil power generation); which, in  spite of rising production, ha s been shedding jobs due to 
technological advances.  
The increase in biofuels production, apart from stimulating agricultural production and 
research and development, will trigger additional investment in  bio-refinery plants and the 
adaptation of conventional fuel refineries (n ew facilities for storage and blending purposes) 
and petrol filling stations (additional tanks  and new pumps for pure biofuels or high-
percentage biofuel blends). These investments will create new jobs both directly (mostly in 
bio-refinery plants) and indirectly through the investments multiplier effect. Moreover, 
                                                 
30 Martin Base, Hans van Meijl, Andrzej Tabeau and Geert Woltjer Will EU biofuel policies affect global 
agricultural markets? , LEI, Wageniningen UR, 2008 
31 Dixon, P.B., Osborne, S. and Rimmer, M.T. The economy –wide effects in the United States of 
replacing crude petroleum with biomass , June, 2007 
32 Biofuels in the European Context: facts, uncertainties and recommendations JRC working paper, 
December 2007 
33 Biofuel Progress Report, Review of economic and environmental data for the biofuels progress report, 
Commission Staff Working Document, Sec (2006) 1721. 
34 Renewable Energy Roadmap impact assessment. 
35 Employ RES project: Employment and economic growth of sustainable energies in the European Union 
led by Fraunhofer ISI (An ongoing study commissioned by European Commission , DG TREN). 
36 Green Jobs, by UNEP, ILO and others, produ ced by Worldwatch Institute, September 2008 
 
EN 29   EN personnel already employed in the conventional fuel  industry will need re-training to deal 
with the handling, blending and commercialization of biofuels.  
Development and external relations 
As noted earlier, it is likely that the growing biofuels dema nd will be met in part through 
imports. Prospective access to European mark ets has considerably increased developing 
countries' interest in biofuels. At the same time , rising food prices have also created concerns 
about the sustainability of biofuels production and its impact s on food availability in world's 
poorest regions. Although, it is important to point out that prices have subsequently fallen 
back, at present it is not po ssible to predict with sufficient accuracy their future trends. 
The rise in demand for biofuels and current biofuel support policies have sometimes been 
suggested as key factors in food price increases , especially in the wake of commodity price 
increases in the first half of 2008. In  its Communication on high food prices37 adopted on 20 
May 2008, however, the Commission found that current EU biofuel production and the new 
2020 10% renewable transport fuel target had little impact on cu rrent global food prices. This 
was because biofuels use less th an 1% of EU cereal production and long lead-times make it 
unlikely that they could have ha d an impact on today's prices. 
These findings were confirmed in another communication on Food Prices in Europe adopted 
on December 2008 following additional analysis on the reasons behind recent food price 
fluctuations. In this communication the Commission confirmed that that the surge in 
agricultural commodity prices resulted from a combination of structural and temporary factors, 
among which, the emerging biofuels market had a rather insignificant impact38.  
In order to respond to the food price concerns  and to create additional safeguards against 
possible negative impacts, the newly established biofuels sustainability scheme in the Renewable Energy Directive contains a set of monitoring and reporting requirements, 
including food price and food ava ilability impacts in the EU and third countries, which are 
significant sources of biof uel imports into the EU. 
According to Faaij
39, bioenergy production will nearly always compete with food production 
including feed. However, improved bioenergy production systems that allow for synergies 
with food production exist and can provide sign ificant benefits. For example, intercropping 
jatropha with annual food crops can potentially increase food yields, while at the same time 
producing biomass for energy; and agro-forestr y systems can deliver both food and biomass 
for construction, fibre and fuel use, as we ll as secure high levels of biodiversity.  
The relationship between bioe nergy and food production depends  on developments in the 
agricultural sector and conseque nt variations in agricultural productivity. Higher prices for 
food products or strategies to st imulate development in  agricultural manageme nt might lead to 
an increase in agriculture efficiency as increased demand leads to higher investments. As a result, food production could improve using less of  the resources at hand for the production of 
a given amount of bioenergy. 
                                                
 
37 Commission's Communication Tackling the challenge of rising food prices, adopted on 20 May 2008,  
COM(2008) 321 final 
38 Commission's staff working document "Monitoring prices developments" ( SEC(2008)2970 ) 
accompanying Communication on Food prices in Europe, adopted on  9 December 2008, COM(2008) 
821  
39 André Faaij: Bioenergy and global food security, 2008 
 
EN 30   EN In 2007, about one fourth of biodiesel and almost  a third of bioethanol consumed in the EU 
was imported. Most of those imports came from  Brazil and the USA. South Africa and the 
Democratic Republic of Congo also expor ted some bioethanol to the EU.  
The EU has developed a Free Trade Agreement Partnership with a bloc of East African 
Countries by negotiating Economic Partnership Agreements (EPA) on a b ilateral basis and the 
negotiation of an EPA is underway with Tanzan ia. EPAs will affect policy development in 
those countries and the biofuels feedstock sector may be influe nced. EPAs could be strategic 
for the EU biofuels policy, given the remarkab le potential of East African Countries to 
produce jatropha. Particularly fa vourable land properties and climatic conditions for the 
production of jatropha are alread y attracting Foreign Direct I nvestments to East African 
Countries (Tanzania and Ethiopia in particular).  
Currently no specific classification and dedicated tariff lines exist for biodiesel and bioethanol 
The former is classified as “other chemicals. ” while the latter is an agricultural by-product. 
This situation could change in near future, if and once a dedicat ed tariff line is established for 
biodiesel. 
The current tariff regime on biof uel feedstock and biofuel also has some impact on the biofuel 
prices in the EU. Although the Most Favoured Nation (MFN) tariffs on ethanol are very high 
and generally higher than those applied to bi odiesel. African, Caribbean and Pacific (ACP) 
countries (except South Africa), the Least Developed Countries (LDCs) and all those 
countries eligible for the Generalized System of Preferences Plus (G SP+) tariffs can benefit 
from duty free and quota free access to the EU market for ethanol. The new GSP system 
(effective from January 2006) also allows Pakist an unlimited access to the EU ethanol market. 
Current biofuels imports are not subject to a ny formal sustainability requirements, although a 
number of voluntary certification systems do exist. This will change with the entry into force 
of the new biofuel sustainability scheme include d in the Renewable Energy Directive. Biofuel 
producers, fuel distributors and Member State authorities will be held  responsible for the 
entire production chain of biofuels, whether domestically produced or imported.  
Research, innovation and promotion of second generation biofuels 
According to the IEA's 2006 World Energy Outlook40, the cost of producing biofuels has 
reduced by 5-10% over the last 10 years and the costs of produc ing bioethanol and biodiesel 
are expected to diminish by a further 25-50% an d 20-25% respectively over the next 10 years. 
According to the same study, the cost of produci ng biodiesel in Europe is projected to drop 
from US$0.60/litre to US$0.40/litre by 2030 due to the economies to scale achievable by 
using bigger plants. The cost of bioethanol production is projected to drop by around 30% by 
2030 compared to its cost of production in 2005. Such improvements depend on research and development and the rate of growth of th e production capacity of biofuels plants.  
According to the same source, the cost of producing second generation biofuels (such as 
enzymatic hydrolysis and gasification of lingo- cellulosic biomass) is likely to drop to $40-
50/barrel
41 in the decades to come making biofuels  competitive with conventional fuels by 
203042. 
                                                 
40 Source: IEA, World Energy Outlook (2006). 
41 Source: IEA, World Energy Outlook (2006). 
42 The price of crude oil that has been assumed in the WEO (2006) for 2030 (reference scenario) is $ 
97,30 per barrel. 
 
EN 31   EN Another view can be obtained by assessing the demonstration plan ts that have been built in 
Germany to test the production of di esel via Fischer-Tropsch synthesis43. As of 2006, the cost 
of producing biodiesel through th is technology was $0.90/litre, with  the perspective to reduce 
it to $0.70-0.80/litre in the long-term44. 
Under the Sixth Framework Programme (2002-2 006) almost €35 million were made available 
to support the research and deve lopment of biofuels, of which €5 million for the development 
of second generation biofuels technologies.  
In the Seventh Framework Progra mme €59 million have been allocated for biofuels in the 
first two calls in 2007 and 2008. The largest part  of this amount - €51 million or 86% - has 
been allocated to 2nd generation biofuel techno logies. Furthermore in 2009 an additional €15 
million will be allocated to bio refinery projects45. 
In addition, Member States support national re search programmes in biofuels technologies. 
For instance, Denmark has focused its effort s in financing research in ligno-cellulosic 
processes to produce bioethanol from the wast e from agriculture, forestry and the timber 
industry. Spain has launched th e CENIT biodiesel initiative,  a four-year research and 
development project managed by the privat e sector and financ ially supported by the 
Government, which aims to identify new raw materials and to deve lop new processes and 
technologies to produce biodiesel. 
3.4. Environmental impacts  
Assessment of the life-cycle gree nhouse gas impact of biofuels 
The analysis presented here assesses th e greenhouse gas savings due to EU biofuel 
consumption. 
The analysis was based on the most recent JEC data on typical greenhouse gas reductions.  
Member States' data on biofuel production/co nsumption were disaggregated, as far as 
possible, by feedstock46 and JEC typical greenhouse gas values  were applied to determine the 
amount of greenhouse gas savings for each type  of feedstock for each Member State. 
Reflecting the future requirement s of the Renewable Energy Dire ctive, the anal ysis was done 
in duplicate, using both the energy allocati on method and the substitution method to account 
for co-products.  
At an aggregated level, the EU-27 had a biofuel share of 2.6% in 2007 and an average 
greenhouse gas saving, relative to the fossil fuels replace d, estimated at 49% (energy 
allocation method) or 48% (substitution method).  
                                                 
43 See Kutas et al 
44 2nd generation biofuels based on the gasification of biomass to produce liquid fuel, seem to be a 
promising way to obtain significant greenhouse gas savings. Across Europe, different Biomass to Liquid (BtL) technologies are under development. Table 26 in Annex D summarises the BtL plant 
projects planned by the RENEW project partners . Based on the announced  plans of companies 
developing 2nd-generation biofuel facilities, the firs t fully commercial-scale operations could possibly 
commence as early as 2012. Howeve r, given the complexity of the technical and economic issues 
involved, the first commercial  plants are unlikely to be deployed before 2015. Therefore, at present, it is 
difficult to estimate the potential greenhouse gas emissions savings from increased share of 2
nd 
generation biofuels. 
45 These budget allocations only refer to the biofuel and biorefinery support projects managed by DG 
TREN. A part of energy budget under Sixth and Seventh Framework programmes is managed by DG 
RTD.  
46 Source: PwC data based on Member State's reported feedstocks  
 
EN 32   EN Focusing on the physical savings in terms of CO 2eq, the 5611 ktoe of biofuels consumed in 
2006 and 8105 ktoe consumed in 2007 can be translated into greenhouse gas emissions 
savings. The life cycle greenhouse gas emissions  associated to trad itional fuels is 83.8 
gCO 2/MJ (energy allocation method). If the above mentioned coeffi cients are applied, in 2006 
and 2007 respectively 19.7-20.3 and 28.4-29.4 Mt CO 2eq which would have been emitted in 
the atmosphere from fossil fuels, have been avoided. However this gross saving exaggerates the benefits, since emissions from the producti on of biofuels should be deducted. The net 
saving can be calculated by multiplying these gross savings by the average percentage of emissions saved by biofuels (48%-49%). One can then calculate the net savings achieved in 
the European Union from biofuels placed on the market and consumed: 
9.7 (energy allocation/substitution) Mt CO
2-eq. in 2006  
14.1 (energy allocation) / 14.0 (substitution) Mt CO 2-eq. in 200747.  
Land use  
Most biofuels are made from crops. The promoti on of biofuels therefore leads to an increase 
in demand for agricultural commodities. Su ch increases in demand can be met through 
increased land use for agriculture or through incr eased yields from land already in agricultural 
use. If the increas e in demand is partly met through land conversion and if the land converted 
has a high carbon stock, this process would lead  to greenhouse gas emissions that offset the 
greenhouse gas benefits from the use of biofuels. 
In the EU, arable land has been falling out of agricultural use for decades. That process is 
continuing. In terms of land use, the main effect  of EU biofuel consumption has been the re-
use of recently abandoned agricultural land, or  a reduced rate of la nd abandonment. Recently 
abandoned agricultural land does no t have a high carbon stock. It follows that to date. EU 
biofuel consumption is not lik ely to have caused significant damaging land use change. In 
fact, it is more likely to have brought benefits in this respect,  since the crops used in the EU 
for biofuel production produce, at the same time, significant quantities of co-products that are 
used as animal feed. This mainly replaces anim al feed from soya, whic h has been associated 
with damaging land use change notably in Latin America. 
For the future, biofuels from certain define d types of high carbon stock land will not count 
towards the targets in the Renewable Energy Di rective and will not be eligible for public 
support. Moreover, the greenhous e gas calculation methodology in the Directive will ensure 
that the carbon stock cost of conve rting other types of land is fully  taken into account. Since it 
is expected that biofuels fulfilling the sustaina bility criteria will command a premium price, 
these measures will tend to increase producers' reliance on yield increases rather than land use 
increases to meet increased demand. 
This does not rule out the possibility of increased demand for agricultural commodities for 
biofuels leading to an overall increase in the damaging conversion of land, even if the biofuels 
themselves do not come from this land. The Di rective therefore requires the Commission to 
report, by 2010 at the latest, on how  best to address this issue. 
Other environmental impacts of biofuels 
The production of biofuel feedstock can have environmental effects beyond the impacts on 
greenhouse gas emissions, such as impacts on biodiversity, water consumption, water quality 
and soil quality. The extent and character of these impacts varies according to factors such as 
                                                 
47 The figures are derived by the JEC method, which is  not a real substitution method, which would not be 
possible to use for fuels produced in refineries. 
 
EN 33   EN agro-climatic make up; land-use patterns; feedst ock; rainfall patterns; scale of production; and 
long and short time scales.  
Biodiversity  
Published studies on the biodiversity impacts of growing bio-energy crops are diverse and 
have conflicting results. This is due to the different time horizons (s hort or long term) and 
scales of observation (local . regional or global) used. 
Therefore, the integral global impacts of bi ofuels on biodiversity depend mainly on the long-
term positive effect of reduced future climate change and the short-term negative effect of land-use change for large scale energy crop cultivation rather than nature. In determining whether short-term losses can be balanced by long-term gains, uncertainties should be taken 
into account
48. 
Water consumption   
The ideal study on biofuel impacts on water cons umption does not exist as several diverging 
aspects have to be considered. Water availabi lity and water use can be assessed at a crop, 
farm, river basin, continental and global scale. Each scale has it s own parameters for reliable 
calculations and estimates and its own assessmen t targets. Water use for bioenergy production 
has to be compared with actual water use an d existing or expected bottlenecks for water 
availability need to be identified. As priority is often given to the other uses (food, domestic 
and industrial water use), all uncertainties and inaccuracies accumulate in the final assessment 
of the scope for energy crops. 
Different studies show that in some regions  abundant water availabi lity provides ample 
opportunities for energy crop production, while wate r scarcity in other regions is seriously 
restricting any opportunity for energy crops.  
A rough estimate of available blue water for energy crops, based on gl obal water flows, is 
1,300 to 5,000km³, depending on th e share required for environm ental water requirements 
(50-20%). However, whether this water is ava ilable and can be used cannot be determined 
based on available studies. Future change in rainfall patterns will have a large impact 
regionally49. 
Water pollution   
Producing more biofuels crops may affect water quality. For example, if (unlike the current 
EU experience) additional demand for biofuels  were to be met by converting pastures or 
woodlands into crop fields, this could exacerbat e problems such as soil erosion, sedimentation 
and excess nutrient run-off into surface wate rs and infiltration into groundwater from 
increased fertilizer application. Pesticides a nd other chemicals can wash into water bodies 
negatively affecting water quality. However, it is  worth noting that different biofuel feedstock 
differ markedly in their fertilizer and pest icides inputs per hectare. For example, high-
diversity prairie biomass is estimated to requi re only a fraction of th e nitrogen, phosphorus 
and pesticides required by maize with co rrespondingly lower impacts on water quality50.  
                                                 
48 Climate change, scientific assessment and policy an alysis, biomass assessment, assessment of global 
biomass potentials and their link to food, water, biodiversity, energy demand and economy, Main 
report. January 2008. Editors Erik Lysen Sander van Egmond. 
49 Climate change, scientific assessment and policy an alysis, biomass assessment, assessment of global 
biomass potentials and their link to food, water, biodiversity, energy demand and economy, Main 
report, January 2008. Editors Erik Lysen Sander van Egmond 
50 FAO, the State of Food and Agriculture, Biofuels : prospects, risks and opportunities, Rome, 2008. 
 
EN 34   EN Soil resources 
Both land-use change and intensification of agricultural production on existing croplands can 
have significant adverse impacts on soils, but  these impacts (just as for any crop) depend 
critically on farming techniques. Inappropria te cultivation practices can reduce soil organic 
matter and increase soil erosion by removing permanent soil cover. The removal of plant 
residues can reduce soil nutri ent contents and increase gr eenhouse gas emissions through 
losses of soil carbon. In the EU, production of rape  seed for biofuels has tended to diversify 
crop rotations, with beneficial effects. 
On the other hand, conservation tillage, cr op rotations and other improved management 
practices can, under the right conditions, re duce adverse impacts or even improve 
environmental quality in conjunction with in creased biofuel feedstock production. Growing 
perennials (such as palm, short- rotation coppice or sugar cane ) instead of annual crops can 
improve soil quality by increasing soil cover and organic carbon levels. In combination with no-tillage and reduced fertilizer  and pesticide inputs, positive impacts on soil resources can be 
obtained
51. 
Air quality   
Prospective biofuels offer a number of distinct  advantages relating to  air pollution. Blending 
bio-diesel with conven tional diesel in engine s results in substantia l reduction of un-burnt 
hydrocarbons, carbon monoxide and particulate matters (the only negative is a NOX value 
which is higher). Biodiesel also contains no aromatic compounds. Current EU diesel 
requirements set a maximum sulphur content of  10ppm. There is no clear evidence of any 
increase in efficiency or reduction in GHG emissions. However the Commission is currently 
studying these issues. 
                                                 
51 FAO the State of Food and Agriculture, Biofuels: prospects, risks and opportunities, Rome, 2008. 
 
EN 35   EN Conclusion  
From an environmental perspective, it is es timated that. the current achieved net greenhouse 
gas savings achieved in the European Union from biofuels placed on the market and 
consumed (in 2006 and 2007) amounted to 23.8 Mt CO 2-eq. This takes into account the 
estimated impact of associated land use cha nge, bearing in mind that most EU biofuel 
consumption has been fulfilled through the re-use  of recently abandoned agricultural land or 
through slowing down the rate of land abandonment.  
Turning to broader environmental impacts, bi ofuel production contributes to an increased 
extent and intensity of agricultural producti on in the EU. This can have both positive and 
negative environmental effects. In particular, increased pressure on the use of land with high 
biodiversity value and soil carbon stock may be expected, togeth er with a highe r incentive to 
use more fertilizer per hectare. On the other hand land abandonment should slow down, 
particularly in disadvantaged and environmentall y sensitive rural regions.  This should have a 
positive effect in terms of erosion and fire prevention, landscape and biodiversity 
maintenance. The Commission is not aware of sp ecific reasons for concer n in relation to the 
impact of biofuels in this respect. Howeve r, under the new Renewable Energy Directive, 
economic operators and Member States will be required to report in more detail on the land 
use changes and other environmental impact s from increased production of biofuels.  
While this analysis confirms the positive impact of the policy to date, the last progress report 
made it clear that it is essential for the further expansion of biofuels to be accompanied by the introduction of appropriate sustainability criteria. Such criteria are included in the new Renewable Energy Directive, covering mini mum requirements for greenhouse gas savings, 
requirements to avoid damaging land use change and reporting requirements covering a wide 
range of environmental and social issues. 
3.5. Further measures needed in the transport sector 
Under the provisions of Direc tive 2003/30, this progress report should review options other 
than biofuels for improving en ergy efficiency in transport. 
Any measure aimed at improving the enviro nmental performance of new cars (from 
increasing their energy efficiency  to substitution with hybrid, electric or hydrogen vehicles) 
will affect greenhouse gas emissions and fuel consumption of the new European car fleet. The average number of new registrations between 2003 and 2007, was 15.2 million passenger cars/year compared to a stock of 230 million cars in 2006. Measures aimed at reducing the consumption of the whole stock of cars, like “eco-driving”, increasing  car occupancy rates 
and improving traffic infrastruc tures have a larger potentia l in terms of greenhouse gas 
emission and fuel saving, but re quire a coordinated effort at  local, regiona l and central 
government levels in terms of policies, support and communication. 
The following table provides an estimation of  possible greenhouse gas emissions savings, 
fossil fuel savings and monetary cost and benefits of different  "green transport" measures. 
 
EN 36   EN Table 14:  Summary of options concerning energy e fficiency measures in transport. 
Measure 
scope Measure detail GHG saving 
(MtCO2) Fossil fuel 
saving 
(Mtoe) Monetary costs and benefits 
Increasing the 
efficiency of ICE cars 
from 160 to 130 g 
CO2/km and from 6.4 to 5.2 l/100 km 
consumption 3.7 to 5.4 in 
2012 1.2 to 1.76 in 
2012 Saving of up to 200€/year for drivers 
due to reduced consumption  
Additional cost of 3500€/car for the 
120gCO2 /kmtarget or 2500€/car for the 130gCO2/km over a period of 6 
year
52 New 
passenger 
cars 
Hydrogen (only zero 
carbon hydrogen considered here) Up to 15 
MtCO2 saved in 
2020 in the 
hypothesis of 5% new cars 
fuelled by 
zero carbon Hydrogen .Depending 
on how hydrogen 
will be 
generated. Additional cost per vehicle of €5-
10000. Between €2 and €3 per 100 km
53 
 
Electric Cars Depending 
on where the 
electric 
energy is 
sourced Depending 
on where the 
electric 
energy is 
sourced Electric vehicles may cost up 2-3 
times more than conventional ones. 
Cost may be greatly reduced by mass 
production. Batteries to be replaced 
every 2-3 year at the cost of €2300-4000.
54   
Hybrid vehicle. in the 
hypothesis of 50% 
penetration of new cars in 2012 (3.% of 
the whole stock) 2.7 to 3.9 
additional to 
1) 0.36 to 0.53 
additional to 
1) Additional cost per vehicle of around 
€3,100 
Saving of up to €280 year for drivers due to reduced consumption
55  
 
Eco-driving 50 MT as 
theoretical 
potential  Long term 
effect of 7% 
saving  under 
everyday 
driving 
conditions Saving of up to 128€/tCO 2 due to 
reduced consumption.56  
 Whole 
passenger 
car stock 
Increase of car 
occupancy rate 
(assumption of a 0.05 
increase of the Car 25 MT 8 Mtoe57   
                                                 
52 PwC calculation based on the assumption of an average mileage of 15000 km/y per ve hicle and from ACEA 2007: 
Reducing co2 emissions from cars: towards an integrated approach  
53 EUCAR, JRC, CONCAWE (2007), Well-to-w heels analysis of future automotive fuels and powertrains in the 
European context; DGTREN, 2003, Hydrogen Energy and Fuel Cells A vision of our future, p.15; 
http://www.hyways.de/. HyWays presentation, 8 May 2007)  
54 Electric Auto Association Europe: h ttp://eaaeurope.org/emissions_of_eas.html)  
55 PwC calculation obtained by comparing the average performance of vehicles belonging to the most 
common and representative cluster in Europe with the performance of the hybrid model belonging to 
the same category by body type and cubic capacity: Honda Civic Hybrid as 2/4 Door Sedan up to 
1500cc and Toyota Prius as 5 Door Sedan up to 1500cc; Sources: Clean Green Cars Website: 
http://www.cleangreencars.co.uk/ , Quattrouote Website: http://www.quattroruote.it/ ; “Alternative Fuels: An 
Energy Technology Perspectiv e” IEA/ETO. Hybrid Cars Webs ite: http://www.hybridcars.com 
56 ACEA 2007: Reducing CO2 emissions from car s: towards an integrated approach  
57 PWC calculation on the basis of data from ICARO: (Incr easing Car Occupancy): A Research And Demonstration 
Programme On Car-Pooling, European  Commission DG VII, 1999) and fro m DG-TREN data (DG-TREN 2008.EU 
energy and transport in figur es Statistical pocketbook 2007/2008  
 
EN 37   EN Occupancy Rate) 
Improvement of traffic 
lights  Up to 2.4 
MT/y 58   
Increase 
Biofuel consumption 
up to 5.75% 1
st generation 25.7 MT 18.3 Mtoe59  
 2nd generation In 2020   
Source: PwC  
In the two years since the last biofuels progress report, the Commission has taken a number of 
initiatives to make the European transport sector greener. The new CO 2 emission reduction 
strategy, including specific targets for all ne w cars sold in the EU, was adopted by the 
Commission on 31 January 200760. On the same date, the European Commission also 
proposed to revise the EU Fuel  Quality Standard. Both of these proposals, which were 
endorsed by the Council and Parliament in D ecember 2008, will enable the EU to reach its 
long-established objective of limiting average CO2 emissions from new cars to 120 grams/km by 2012. This will not only reduce CO2 emissi ons by around 25% from 2008 levels but will 
also improve fuel efficiency, delivering substantial fuel savings for drivers.  
4. T
HE IMPLEMENTATION OF THE BIOMASS ACTION PLAN  
According to the latest data available from Eurostat61, 88 Mtoe of biomass was consumed for 
energy purposes (primary energy consumption) within the EU-27 in 2006, representing an 8% 
increase from 2005. In terms of final energy consumption, around 58 Mtoe was consumed in 
2006- around 5% of total energy consumption62.  
This achievement is still a long way from reaching the EU's biomass potential  identified in 
the EU Biomass Action Plan.  
Biomass for electricity (including biogas) and biomass for transportation fuels have grown 
faster than biomass for heat, due to clear targ ets set for renewable energy used in transport 
and electricity.  Electricity production using solid biomass has increased annually at a rate of 
around 10% since 2004. The EU owes this incr ease principally to the development of 
electricity resulting from co-generation (combi ned heat and power) in Germany, Finland and 
Sweden and in particular to the use of biogas in cogeneratio n, which represented around 60% 
of electricity production from biogas in 200763. 
                                                 
58 ACEA 2007: Reducing CO2 emissions from cars: towards an integrated approach  
59 PWC calculations based on GHG values contained in the EU Commission Proposal for a Directive on the 
promotion of the use of energy fr om renewable sources (January 2008)  
60 Communication from the Commission to the Council and the European parliament, 2007. Results of the 
review of the Community Strategy to reduce CO2 emissions from passenger cars and light-commercial 
vehicles. 
61 2006 
62 Primary energy consumption refers to the consumption of energy sources like biomass before 
conversion to other forms of energy (electricity, heat, transport fuel), and final energy consumption 
refers to energy consumed after conversion into other forms of energy and excludes the use of energy 
sources for non-energy purposes, such as self-consumption by power plants and losses.  
63 Biogas Barometer, No 186-2008 
 
EN 38   EN 4.1. Availability of biomass 
Projections using modelling by PRIMES64 and Green X65 estimate that around 165-195 Mtoe 
of biomass would be used in 2020 to achieve the 20% renewables  in primary energy target. 
The Environment Energy Agency (EEA) report of 200666 concluded that significant amounts 
of biomass can be theoretically available to support ambitious renewable energy targets. 190 
Mtoe in 2010 and 235 Mtoe in 2020 is deemed  feasible even if strict environmental 
constraints are applied (e.g. no conversion of permanent grassland), although the report does 
not look at the economics of ha rvesting/producing the additional biomass resources or at the 
measures needed to ensure that this potential is realised.  
Many other studies have assess ed biomass resource availabili ty in the EU-27. A European 
Commission funded review of over 70 studies67 found that total 2020 pote ntials estimated for 
the EU-27 differ to a considerab le degree: 76 Mtoe - 480 Mtoe. The wide range is mainly due 
to ambiguous and varying methods of es timating biomass produ ction and different 
assumptions that influence pot entials (such as land use fo r food and fibre purposes).  
Further studies are being carried out in the meantime, in particular to better estimate the 
potential wood supply in the EU. In addition, the increasing poten tials and benefits for using 
biomass wastes and forest and agricultural residues and of new innovative processes such as 
bio-refineries should not be unde restimated. However, any risks of overuse of forests should 
be assured and all EU Member States have si gned up to the Ministerial Conference on the 
Protection of Forests in Europe (MCPFE), wher e the guiding principle is sustainable forest 
management.  
Any policy or action plan to increase the use of biomass must therefore ensure a certain 
degree of harmonisation of information and data  on biomass so as to improve the accuracy 
and comparability of future biomass resource assessments. 
4.2. Actions taken to increase the availability and use of biomass 
National biomass strategies have a key role in  achieving the 20% renewable energy target, 
ensuring the long-term, sustaina ble supply of biomass resources  and in increasing investor 
confidence in biomass and biomass technologies. On e of the main actions identified in the EU 
BAP was to encourage Member States to develop national  Biomass Action Plans. An expert 
group68 was set up in 2006 to discuss how to achieve  a coherent and coordinated approach on 
bioenergy and to share experiences on nationa l approaches to data collection, on support 
schemes etc. 
Another important element is addressing the diffe rent uses of biomass as these resources can 
be used for a variety of purposes and in a vari ety of ways, some of which are more efficient 
than others. The Internati onal Risk Governance Council69 agrees that the trade-offs involved 
in making decisions regarding bioenergy policies are context-specific an d. Therefore, require 
different approaches in different countri es. Governments therefore must design and 
                                                 
64 SEC(2008)85 Annex to the Impact  Assessment accompanying the pack age of implementation measures 
for the EU's objectives on climate change and renewable energy for 2020 
65 COM(2006)848 Biomass Action Plan 
66 EEA (2006) "How much bioenergy can Europe produce without harming the environment". See also 
UNECE/JWEE 2008 study on potential wood supply.  
67 Biomass Energy Europe "Status of Biomass Reso urces Assessments Version 1", 19 December 2008 
available at: http://www.eu-bee.com/   
68 For more information see: http://ec.europa.eu/energy/renewables/bioenergy/bioenergy_en.htm  
69 IRGC (2008) Risk Governance Guidelines for Bioenergy Policies 
 
EN 39   EN implement policies according to their energy need s, available resources (particularly land and 
water) and economic development. 
Activities under the EU's Forestry Action Plan have been instrumental in bringing forward 
proposals on necessary elements for a national acti on plans. In that context, the EU's Standing 
Forestry Committee70 advocates Member States to develop a strategy on mobilisation and 
efficient use of wood71. The Commission's Communicatio n on innovative and sustainable 
forest based industries72 asks that Member States pay a ttention to the different uses of 
biomass when developing the national action plans.  
To account for the EU's new energy challenges the Health Check of the Common Agricultural 
Policy73 made available additional funds for bio-energy under the European Rural 
Development Fund (EAFRD), an increase of  3.2 billion Euros for 2010-2013. By mid-2009, 
Member States will have to revise their national rural development plans and programmes taking into account the new challenges, includ ing biomass for energy from agricultural and 
forestry sources. 
To date, only five Member States have officially s ubmitted their national biomass action 
plans  to the Commission (Estonia, Ireland, Ne therlands, Spain and the United Kingdom). 
Regional biomass plans have also been submitted by Scotland, by the Central Finland region, 
North Karelia and by Northern Ireland a nd the South-East region of Ireland.  
All the submitted biomass action plans seek to assess their biomass resources and potentials 
for energy production from forestry, waste and agricultural biomass. However, these 
resources and potentials can barely be compared since the data is pres ented in various units 
and in a non-standardised way.  
The national biomass action plans propose various  objectives for biomass use in different 
sectors (electricity, heating and transport) but the relationship of these sectoral targets to the Member State's overall renewable energy target is not clear. Measures for mobilising new biomass resources are not given great considerati on in any of the action plans, but on the other 
hand the importance of biomass imports is ac knowledged. Such an approach will not be 
sustainable at EU level,  unless countries or regions can be sure that the biomass imports they 
rely on will be available. 
To ensure that there is an overview of the av ailability of resource s and of measures to 
promote the production and use of biomass resources, the Commission will provide a 
template for developing renewa ble energy action plans by June  2009. In particular, it is 
considered useful that the development of thes e plans is carried out wi th the involvement of 
relevant stakeholders at local, regional and national level. The regions which have submitted their biomass strategies have considered issues important at the local level, such as adequacy 
of manpower to reach objectives, the need for investments in equipment and logistics and 
analysis of technologies that are suited to local conditions.  
The "Intelligent Energy  Europe II Programme"
74 identified good practices for promoting 
bioenergy in EU Member Stat es, which show that an ade quate legal framework should go 
hand in hand with appropriate support sche mes. Germany uses a 'market incentive 
programme' for leveraging the installation of smal l-scale biomass heating systems, especially 
                                                 
70 http://ec.europa.eu/agriculture/minco/othco/forest/index.htm 
71 Report on mobilisation and efficient use of wood an d wood residues for energy generation available at: 
72 COM(2008)113 
73 Regulations (EC) 72/2009, 73/2009, 74/2009 O.J. L30. 
74 http://ec.europa.eu/energy/intelligent/index_en.html 
 
EN 40   EN pellet boilers, while Sweden impos ed a carbon tax to provide long term and stable incentives 
for bioenergy. France focuses on supporting spec ific regional programmes such as the “wood-
fuel and local authorities programme", promoting regional development and mobilisation of wood for heating purposes, which triggered th e construction of 1,764 wood heating plants 
(1,170 MW installed power). The success of these programmes is due to the continuity of the 
policy and support schemes by th e state and/ or the region
75. To support such schemes at 
regional and local level, approximately €1.7bn from Community funds under Cohesion policy 
will be mobilised for biomass investment between 2007 and 2013. 
4.3. Barriers to the uptake of bioenergy 
There are still several administ rative barriers that hi nder the development of bioenergy plants 
within EU Member States. The Commission ca rried out a study on be nchmarking bioenergy 
permits76, looking at the length of time it takes to  get a permit in the EU and the factors 
affecting the success or failure of getting a pe rmit (which can also mean authorisation or 
license to perform an activity). While several countries have put in place integrated permitting 
procedures and apply the “one-s top shop principle", most bioene rgy projects require several 
permits steps (in France. Italy and Germany, 1- 4 permits are required, whereas in Spain. 
Romania and Poland, around 6-8 permits are required).  
Most individual types of permits and licenses across Europe take a relatively short time to 
obtain (a few weeks). Hence, th e long timeframes for getting pe rmits are often caused by the 
serial nature of the various perm its and cross-authorisa tion. In general, th e land use permit (in 
case of land use change), the environmental permit, in case the project requires an EIA, the operational permit and the legal process (in case  of higher appeal) last the longest and 
dominate the duration of the project.
 
On average, gaining a permit takes about two years or three years for the larger biomass 
projects which include an EIA. However, it has also been identified that many projects simply 
fail to get a permit. The permit application failure  rate exceeds 30% for bioenergy plants. This 
is influenced by many factors, including the re lative expense associated  with obtaining all the 
necessary permits (in particular for biogas and co-digestion plants) but in general because of 
local objections. The legal process through which appeals or objections ca n be made often do 
not have mandatory or clear timeframes. Ar ound one third of the analysed cases failed 
because of local objections to bioenergy installations, in particular to co-firing, biogas and 
biofuels plants.  
The cost associated with getting a permit is not  significant in most cases and permits for large 
power plants are not necessarily more expensiv e than for small size plants. Typically, the 
costs are well below 1% of the investments with the exception of the de dicated biogas plants 
where costs are in the order of  1-5% of the investment cost s. However, where there is a 
complex framework of legislative acts, the ap plicant sometimes has to apply for several 
permits simultaneously in order to fulfil environm ental, agricultural, tax, waste etc. permitting 
requirements, leading to high cumulative costs.  
It is therefore recommended that a clear legislative framework is developed for permitting 
procedures of bioenergy installa tions where the role of author ities and timeframes are clearly 
defined. Coordination between permitting bodies is also advised. 
                                                 
75 BAP Driver – European Best Practice Repo rt, available at: http ://www.bapdr iver.org/ 
76 Ecofys and Golder Associates: Benchmarking Bioenergy Permits, 2008 
 
EN 41   EN 4.4. Implementation of the thirty-three actions of the Biomass Action Plan 
The Commission's Biomass Action Plan containe d a number of actions to be undertaken by 
the Commission and by Member States. The following table provides a summary of the 
actions and the state of their implementation. 
Action State of implementation 
Heating and electricity   
1) work towards a proposal for 
Community legislation in 2006 to 
encourage the use of renewable energy, including biomass, for 
heating and cooling The new Renewable Energy Directive, based on COM(2008)19, 
includes the heating and cooling sector. Each Member State will have 
to set sectoral targets and outline in their National Action Plans how they plan to promote the heating and cooling sector and the use of 
biomass to reach national renewable energy targets.  
 
2) examine how the directive on 
energy performance of buildings 
(EPBD) could be amended to increase incentives for the use of renewable 
energy  
The new Renewable Energy Direc tive includes an obligation for 
Member States to increase the sh are of renewable energy in the 
building sector and to, where appropriate, require minimum levels of renewable energy to be set for new buildings and buildings 
undergoing major renovation. The EPBD recast proposal, 
COM(2008)780, abolishes thresholds for new buildings for which minimum energy performance requirements will have to be met and 
reduces the threshold from 1000m² to 50m² for existing buildings.  
 3) study how to improve the 
performance of household biomass boilers and reduce pollution, with a 
view to setting requirements in the 
framework of the eco-design directive  
A tendered study on biomass small-scale solid fuel (including 
biomass) boilers was launched in May 2007. A draft implementing measure will be developed depending on the outcome of this study. 
The study can be followed at: http://www.ecosolidfuel.org/
 
 
4) encourage district heating scheme 
owners to modernise them and convert them to biomass fuel  
The Renewable Energy Directive creates incentives to switch from 
conventional fuels to renewables to meet Member States' targets. The 
Directive also asks Member States to give guidance on incorporating 
district heating and cooling in planning, designing, building and 
renovating industrial or residentia l areas. It also requires Member 
States to assess the necessity to bu ild new district infrastructure for 
heating and cooling in their National Action Plans and where 
appropriate take steps with a view to developing a district heating infrastructure from biomass. 
 5) encourage Member States that apply a reduced VAT rate to gas and 
electricity and to apply such a rate to 
district heating too  
Directive COM(2006)18 is under review and a Commission proposal to streamline VAT rates and favour reduced rates for renewables is 
due to be adopted in 2009. 
 
 6) pay close attention to the implementation of the Directive on 
electricity from renewable energy 
sources  
A progress report is included in this Communication  
 
7) encourage Member States to 
harness the potential of all cost-effective forms of biomass electricity 
generation  
The Renewable Energy Directive allo ws Member States to cooperate 
on joint projects and statistical transfers to allow Member States to meet their targets in the most cost-effective way. The Commission 
produced an assessment of the ef fectiveness and efficiency of 
national support schemes (COM(2008)57). 
8) encourage Member States to take 
into account, in their support systems, 
the fact that, in combined heat and 
power plants, biomass can provide 
heat and electricity at the same time As well as the actions identified in point 4, the co-generation 
Directive 2004/8/EC requires Member  States to analyse the national 
potential for the application of high-efficiency cogeneration, including for renewables. 
 
EN 42   EN  
Transport biofuels   
9) bring forward a report in 2006 in 
view of a possible revision of the 
biofuels Directive, including an 
impact assessment  The Renewable Energy Directive incl udes the transport sector and set 
a minimum target of a 10% share of renewables in transport. 
Directive 2003/30/EC will be repealed and the new Directive 
includes sustainability criteria for biofuels and the promotion of electric-cars from renewables as well as second-generation biofuels. 
An Impact Assessment was carried out (SEC(2008)85). 
 
10) encourage Member States to give 
favourable treatment to second-
generation biofuels in biofuels obligations  
The Renewable Energy Directive gives a bonus to second generation 
Biofuels: they will count twice towards any national biofuels 
obligations. 
 11) bring forward a legislative proposal promoting the public 
procurement of clean and efficient 
vehicles, including those using high blends of biofuels  
A directive on public procurement of  clean and efficient vehicles was 
agreed at first reading in October 2008, based on the Commission's 
proposal COM(2007)817 and Member States have 18 months to 
transpose it.  
 12) examine how biofuel use can 
count towards CO2 emission 
reduction targets for car fleets  
The proposed Regulation for setting emission performance levels for 
passenger cars, based on COM(2007)856, was agreed in co-decision 
procedure in December 2008. It cons iders that the target for reducing 
CO2 emissions to 130g CO2/km can be achieved by new vehicle 
motor technology and a further reduction of up to 10g can be 
delivered by alternatives, such as sustainable biofuels. 
 
13) pursue a balanced approach in 
ongoing free trade agreement negotiations with ethanol-producing 
countries/regions  
In negotiating Free Trade Agreements, the Commission is 
undertaking trade sustainability impact assessments to ensure a balanced approach. 
 14) propose amendments to the 
“biodiesel standard” to facilitate the 
use of a wider range of oils, including imported oils, to produce biodiesel, 
and allow ethanol to replace methanol 
in biodiesel production  
CEN (European Standardisation Committee) has a mandate to amend 
the standard EN 14214. 
 15) assess the impact of options to 
address the issues of limits on the 
content of ethanol, ether and other 
oxygenates in petrol; limits on the vapour content of petrol; and limits 
on the biodiesel content of diesel  
The Fuel Quality Directive 98/70/EC was amended in co-decision 
procedure, taking into account these issues. 
 16) ask the relevant industries to 
explain the technical justification for 
practices that act as barriers to the introduction of biofuels  
The Commission carried out a stud y of a wider scope, looking at 
benchmarking and permitting procedures and barriers for various bio-
energy plants: co-firing, biofuels, biogas and combustion. The results of the study are available at: 
http://ec.europa.eu/energy/renewables/studies/index_en.htm
  
 
17) support developing countries by 
helping them to produce biofuels and 
by maintaining market access conditions that are no less favourable 
than those provided by the trade 
agreements currently in force  
The Thematic Programme for Environment and Sustainable 
Management of Natural Resources including Energy support 
sustainable energy projects in developing countries: http://ec.europa.eu/europeaid/wher e/worldwide/environment/index_e
n.htm   
The dedicated EU-ACP Energy facility finances similar projects: http://ec.europa.eu/europ eaid/where/acp/regional-
 
EN 43   EN cooperation/energy/cfp/cfp_en.htm   
The Global Energy Efficiency  and Renewable Energy Fund 
(GEEREF) also allocated specific funds for projects in developing 
countries 
 18) bring forward a communication dealing specifically with biofuels 
early in 2006  
A biofuels strategy was adopted by the Commission in 2006 (COM(2006)34) and since then biofuels strategies were further 
developed through the Renewable Energy Road Map 
(COM(2006)848) and the Renewable Energy Directive (COM(2008)19).  
 19) Take steps to improve understanding of the costs and 
environmental impacts of all transport 
fuels, including conventional biofuels   
The costs and environmental impacts of biofuels are monitored on a biannual basis through Directive 2003/30/EC and will continue to be 
monitored through the renewable Energy Directive 
 20) take steps to promote the use of 
ethanol in diesel blends and or engines  
related TREN tender project is ongoing with CEN participation 
 
21) look for solutions to the problem 
of overcompensation for biofuels 
under tax exemptions  
The Commission services consider th at the risk of overcompensation 
is low, and will consider the issues on a case-by-case basis   
Cross-cutting issues   
22) assess the implementation of the 
energy crop scheme  The CAP Health Check has abolishe d from 2010 specific support for 
energy crops, as the premium has b een effective only in very limited 
circumstances and has not been  an incentive for production73. 
 
23) finance a campaign to inform 
farmers and forest holders about the 
properties of energy crops and the opportunities they offer  
Rural development funds are used in some cases to support such 
measures. 
 
24) bring forward a forestry action plan in which energy use of forest 
material will play an important part  
The Commission adopted Communication COM(2006)302 on an EU Forest Action Plan, whose implementation is currently undergoing a 
mid-term review. 
 
25) review the imp act of the energy 
use of wood and wood residues on 
forest based industries  
The Standing Forestry Committee has formulated an opinion which 
inter alia  advocates Member States to develop a strategy on the 
mobilisation and efficient use of wood and the Commission's 
Communication on innovative and sustainable forest based industries 
(COM(2008)113) asks Member States to pay attention to the different uses of biomass when developing National Action Plans. The 
Renewable Energy Directive requi res Member States to outline 
measures to be taken to develop existing biomass resources and mobilise new biomass resources for different uses.  
 26) consider how the waste framework legislation could be 
amended to facilitate the use of clean 
wastes as fuel  
The revised waste framework directive was adopted in co-decision procedure in June 2008. A supplementary consultation was launched 
on bio-waste management (COM(2008)811) to consult about waste 
management options for bio-waste including collection (separately or with mixed waste), anaerobic digestion and composting, incineration, 
and land-filling. 
 
27) review how animal by-products 
legislation could be amended in order 
to facilitate the authorisation and approval of alternative processes for 
the production of biogas and other 
biofuels  
The proposed revision of Regulation (EC) No 1774/2002 on animal 
by-products (COM(2008)345) aims to clarify the application of 
Community Legislation on industrial emissions to the burning of animal by-products as a fuel. A clearer and more streamlined 
approval procedure could significantly contribute to a more 
widespread use of animal by-products as an energy source, while 
 
EN 44   EN preserving the current high level of protection of public and animal 
health in the Community.  
 
28) encourage the European 
Committee for Standardisation to 
speed up work on standards for the quality of biomass fuels  
CEN TC 343 activities on "refuse derived fuels" are ongoing 
according to an EC mandate. Anot her tender TC 335 ongoing on 
solid biomass fuel standards. 
 29) explore how to develop a European spot market in pellets and 
chips  
Projects have been carried out under the Intelligent Energy Europe programme (e.g. EuBioNet II, BioXChange). Information can be 
found at: http://ec.europa.eu/energy/intelligent/projects/index_en.htm
  
Standardisation related issues are covered by the 6th Framework 
Programme on research and technological development, e.g. 
BioNorm II,  which is related to CEN TC 335 activities on solid 
biofuels. More information is available at: http://www.bionorm2.eu/   
 
30) encourage Member States to 
establish national biomass action plans  
Three expert meetings were held and 5 National Biomass Action 
Plans have been submitted to date. More information is available at: http://ec.europa.eu/energy/renewables/bioenergy/national_biomass_a
ction_plans_en.htm   
 
31) encourage Member States and 
regions to ensure that the benefits of biomass are taken into account when 
preparing their national strategic 
reference frameworks (NSRF) and operational plans (OPs) under the 
cohesion policy and the rural 
development policy  
Around €8.15 billion or 2.6% of total financial resources were 
allocated to energy projects under the structural and cohesion funds, 
of which €6.34 billion were allocated to renewable energy and energy 
efficiency. Biomass projects make up around 22% of this total. More 
information at: http://ec.europa.eu/regional_policy/atlas2007/index_en.htm
  
The Health Check of the Common Agricultural Policy identified 
renewable energy as one of the new challenges for agriculture. It will 
increase the funds available (EAFRD ) for the new challenges by 3.2 
billion Euros for 2010-2013. By mid-2009, Member States will have 
to revise their national strategy plans and their rural development programmes taking into account the new challenges. Co-financing 
rates are increased for measures addressing the new challenges. 
30b) consider how to develop 
sustainability criteria for transport 
biofuels production and utilisation The Renewable Energy Directive sets binding sustainability criteria 
to be applied to all biofuels/ bioliquids consumed in the European 
Community whether or not they are domestically produced or 
imported  
Research   
32) continue to encourage the 
development of an industry-led 
“Biofuel technology platform”  The biofuel technology platform was launched in June 2006 and 
continues to operate. More information can be found at: 
http://www.biofuelstp.eu/   
 
33) consider how best to take forward 
research into the optimisation of agricultural and woody crops for 
energy purposes and biomass to 
energy conversion processes, give a high priority to research into the “bio-
refinery” concept and to research into 
second-generation biofuels.  
Ongoing, the work programmes under the Seventh Framewor
k
Programme are updated annually. For more information see:
http://cordis.europa.eu/fp7/home_en.html  
 
 
EN 45   EN ANNEX A: MEMBER STATES ' SUPPORT SCHEMES FOR ELECTRICITY FROM RENEWABLE 
ENERGY SOURCES . 
Details of national schemes, dr awn from Member States' reports. 
Austria Price Regulation (feed-in tariff): since 2003 support has been based on a standardised feed-
in tariff system. In 2006 feed-in tariff support was reduced from 13 years to 10 years plus two 
years at a reduced rate. The feed-in rates were also reduced. The feed-in tariffs for 2007 were: 
• Wind: 7.55€ct/kWh for 10 years plus 2 years at a reduced rate 
• Solid Biomass: 11.10-15.65€ct/kWh for 10 years plus 2 years at a reduced rate 
• Liquid Biomass: 6-12.50€ct/kWh for 10 years plus 2 years at a reduced rate 
• Biogas: minus 30% for 10 years plus 2 years at a reduced rate 
• Landfill gas: 4.05-5.95€ct/kWh for 10 years plus 2 years at a reduced rate 
• Geothermal: 7.30€ct/kWh for 10 years plus 2 years at a reduced rate 
• PV: 30-46€ct/kWh for 10 years plus 2 years at a reduced rate 
• Small hydro tariffs due to be set by 31 Decemb er 2007. Tariffs for plants constructed by 
31 December 2007 (dependent on outp ut) were between 3.15-6.25€ct/kWh.  
 
Subsidies: there is €4bn available to support new gr een electricity generating systems. €1bn 
of this was added in 2006, of this 30% is for wind, 30% is for solid biomass, 30% is for biogas 
and 10% is for all other green electricity generating stations excluding hydropower. Up to 
€50m is available for medium-scale hydropower (10-20MW).   
Belgium L'Etat fédéral (competency for offshore electricity from renewable energy sources).  
Green certificate system  with guaranteed minimum prices  according to the electricity from 
renewable energy sources type. There is an ob ligation to buy all electricity from renewable 
energy sources. Theoretically, gr een certificates can be sold in  other Belgian Regions but the 
Federal Estate claims that the Regions do not recognise the certificates at the moment. The 
minimum prices are guaranteed for 10 years (20 for offshore wind). The tariffs are:  
• offshore wind ≤216 MW €107/MWh or €90/MWh for further capacity;  
• onshore wind €50MWh;  
• hydro power €50MWh;  
• Solar power €150MWh; and  
• other €20MWh.  
Income tax reduction:  people who invest in energy efficiency measures (notably solar 
thermal and solar PV) are entitled to a 40% income tax reduction (up to €3,380). Businesses can also benefit from an income tax reducti on if they produce elect ricity from renewable 
energy sources. 
Photovoltaics on public buildings:  the aim is to have 1km² of PV.  €2m funding is available.  
Wind power zone (200km²) created in 2004 in the North Sea (2000MW potential). In 2008 
there will be new legislation to limit the additi onal costs due to distance for wind parks. The 
State already provides up to €25m fo r under-sea cable for each project ≥216MW and 
guarantees the security of investment if an authority stops a development.  
Wallonia  
Green certificate scheme  with a quota obligation. Green cer tificates are issued for each MW 
of electricity from rene wable energy sources. The quotas are:  7% in 2007; 8% in 2008; 9% in 
2009; 10% in 2010; 11% in 2011 and 12% in 2012.  
If quotas are not met there is a fine of €100 per certificate (however under certain conditions 
quotas can be reduced). The minimum guaranteed price for a green certificate is €65 this is 
guaranteed for 15 years. (The 2006 median ma rket price was €91.58). Additional green 
certificates over and above the quota are sold at the market price. Green certificates granted 
 
EN 46   EN outside Wallonia are valid following mutual rec ognition. There will be a review of 2010-2012 
quotas by 1 September 2009. Quotas for 2013 onwards will be set after 1 January 2010.  
Private sector subsidies:  up to 40% of investment (minimum is €25,000) for the production of 
energy from renewable sources.  
Public sector subsidies:  amounting to 30% of TVAC with a possible 10% bonus if the 
amount of electricity from renewable energy sources can be calculated on site.  
Flanders 
Green certificates  issued for each MW of electricity fro m renewable energy sources. There is 
an annual quota which rises annually to 6% electricity from renewabl e energy sources in 
2010. There is a fine of €125 per MW if the qu ota is not met. (25% of electricity from plants 
20-100GWh and 50% of electricity from plants over 100GWh is exempt from the scheme). 
There is a minimum price guarantee for 10 y ears at €80 per Green Certificate for wind, 
biomass and biogas; and €450 for 20 years for solar.  
Grants:  are available for electricity from renewable energy sources projects, calculated on the 
basis of incremental costs of a traditional installation. Subsidies vary depending on the technology and higher subsidies are availabl e for small to medium sized businesses.  
Brussels 
Green certificates are issued for each MW of electricity from renewable energy sources for 10 
years of a plant's operation. PV gets 4 certifi cates per MW for the fi rst 20m² installed, 3 
certificates for the next 40m² and 2 for the rest  of the capacity. Green certificates for bio-
methanisation are calculated on the basis of the or ganic waste collected in the perimeter of the 
plant (the number of certificates is limited to 2 per MW). In 2007 the market price was around 
€92 for a green certificate and Elia (the system operator) guarantees €150/MWh (Elia's price for electricity from renewable energy sources varies accord ing to the market). Green 
certificates can be freely traded and are valid for 5 years from the date of issue. The quotas for 
electricity from renewable energy sources are: 2.5% in 2008; 2.5% in 2009; 2.75% in 2010; 
3% in 2011 and 3.25% in 2012.  
There is a fine of €100 per MW if the quota is not met. 
Subsidies:  for PV a subsidy of up to €3,000 per house is available (third sector organisations 
get 40%). Third sector and business electricity  from renewable energy sources operators are 
also entitled to a 40% subsidy for wind or biomass projects. 
 
Bulgaria Price regulation (preferential prices):  there is an obligation to purchase electricity from 
renewable energy sources at preferential pri ces (except for hydropower over 10MW). These 
prices apply to all electricity from renewable energy sources generating capacity put into 
operation by 31 December 2010 and are set an nually. The March 2008 prices were:  
• hydro <10MW 97.12 BGN/MWh;  
• wind 139.96-185.96 BGN/MWh;  
• PV 718-782 BGN/MWh;  
• Biomass <5MW 164-215 BGN/MWh.  
A market mechanism to promote electricity from renewable energy sources and thermal 
energy will be submitted for approval to the Council of Ministers no later than 31 December 
2011.  
 
Loans:  public-private-partnerships partly funded by the Kozloduy International Fund (KIF), 
the European Bank for Research and Devel opment (EBRD) and the European Investment 
Bank (EIB). A KIF loan of €25.2m generates an EBRD loan of €105m. Electricity from renewable energy sources projects are entitled to up to 20% of their costs. The Enterprise for 
Management of Environmental Protection Activities (under the Ministry of Environment and 
Water) also provides interest-free loans of up to 70% for small hydropower plants.   
Cyprus Price regulation (fixed price): the Electricity Authority of Cyprus is obliged to buy 
electricity from renewable energy  sources at 3.7 CYP/kWh (6.29€ct/kWh). A new price is due 
to be set at the beginning of 2008.  
 
Subsidies:  a fund for electricity from renewable ener gy sources projects is provided from a 
levy of 0.0013 CYP/kWh (0.0074€ct) on electricity consumption.  
 
EN 47   EN • For wind projects up to 30kW businesses get up to 40% of their costs up to €41,006.43 
and CY citizens get 55% up to €51,258 per un it. The electricity is then sold at 6.32 
€ct/kWh.  
• For windmills businesses get 40% up to €17,086 and CY citizens get 55% up to €25,629 
per unit.  
• For installation/replacement of solar therma l water heating businesses get 30% up to 
€17,086 and CY citizens get 45% up to €25,629.  
• For installation/replacement of solar thermal space heating and cooling systems businesses 
get 40% up to €85,430 and CY citizens get 55% up to €117,466 per unit.  
• New/replacement domestic solar systems get up to €170.86 for th ermosyphonic systems 
and up to €341.73 for forced circulation.  
• For space heating using biomass CY citizens ge t 55% up to €18,795. For PV under 20kW 
there are two options. Option A businesses get 40% up to €47,840.84 and CY citizens and 
not-for-profit organisations get 55% up to €64,926.85. Electricity would then be sold at 14.18€ct/kWh (Subsidy of 20.5€ct/kWh minus 6.32€ct is 14.18€ct/kWh). Option B: 
businesses would sell electricity at 27.17€ct and households and other entities would sell it 
at 31.95€ct/kWh.  
• For desalination using renewable energy: small to medium sized businesses get 30% in 
regional aid plus de minimis aid which in total should not exceed 40% of total costs of 
€170,860.  
• For hydro small to medium sized businesses get 30% in regional aid plus de minimis aid 
which in total should not exceed 40% of total costs of €102,516. Elect ricity is sold at 
6.32€ct/kWh.  
• For Geothermal heat pumps businesses can get 30% of costs up to €170,860. Households 
and non-profit organisations can get up to €15,377.  
• For biomass 10-40% of costs can be covered depending on the size of the installation and 
the size of the enterprise up to €683,441. Electricity is then sold at 6.32€ct.  
Additionally grants and subsidies of between €123-152m are expected by 2010 for renewable 
energy and energy conservation.  
In 2007 the cap for photovoltaic power was lifted from 5kW to 20kW. [It is unclear whether 
there are caps for other electricity from re newable energy sources technologies].  
 
Czech 
Republic Guaranteed prices for electric ity from renewable energy sources  over 15 years. Electricity 
from renewable energy sources producers can choose between minimum feed-in tariffs or 
green bonuses (surcharges on the market price for electricity). The tariffs for new plants 
decrease by 5% each year. In 2006:  
• small scale hydro got 1690-2398 CZK/MWh from the feed-in tariff or 640-1340 
CZK/MWh from green bonuses.  
• Wind got 2460-3020 from the feed-in tariff or 1950-2690 CZK/MWh from green bonuses.  
• Biomass got 2340-3375 CZK/MWh from the feed-in tariff and 1220-2255 CZK/MWh 
from green bonuses.  
• Biogas got 2670-3040 CZK/MWh from the feed-in tariff or 1550-1920 CZK/MWh from 
green bonuses.  
• Geothermal got 4500 CZK/MWh from the feed-in tariff or 3510 CZK/MWh from green 
bonuses.  
• Solar got 6410-13460 from the feed-in tariff or 1275-5700 from the green bonus.  
 
Subsidies:  30% of capital costs up to CZK 2.8m. (For non-profit organisations and public 
bodies up to 90% is available).  There are also two EU Structural Aid programmes: Industry and Enterprise Operational 
 
EN 48   EN Programme gave up to 46% of capital costs up  to CZK 30m; the Infrastructure Operational 
Programme from the European Regional Development Fund provides up to 75% but no more 
than CZK 10m. A project could also be funded by a State Environmental Fund taking support up to 90% of costs.  
 
Denmark Subsidies:  for onshore wind have increased and there will be several new tenders for 
2x200MW offshore wind farms. There was also an increase in the subsidy for biomass and biogas. The self-sufficiency rule  for waste incineration at power stations has been repealed.  
 
Estonia Fixed price and guaranteed purchase: from 2007 network operators were obliged to buy all 
electricity from renewable energy  sources at a fixed price of 1.15 EEK/kWh. (Therefore the 
mandatory purchase price rose by 42% and network operators were no longer just obliged to 
purchase electricity from renewable energy sources to cover network losses).  
 In addition to the purchase obligation electric ity from renewable energy sources producers can 
also receive aid of 0.84 EEK/kWh  for electricity sent to the gr id and sold. The duration of the 
aid scheme was also extended to 12 years (it had previously been 7-12 years but only up until 2015).  
 
There is a restriction on wind energy from 2009:  only the first 400GWh in a calendar year can 
receive aid and only the first 200GWh is entitle d to the purchase obligation. All further 
electricity must be sold on the open market.   
Germany  Price regulation (fixed prices): higher than market prices for electricity from renewable 
energy sources which differ depending on the type of electricity from renewable energy 
sources. For biomass, the fee structure is based on the plant's size and there are various bonus 
payments for using renewable sources or timber remains from forestry; new technology; or 
operating on a Combined-Heat and Power basis.  There are incentives for modernising hydro 
plants over 5MW.   
The next EEG Review (Erneuerbare Energie Gesetz) will reassess the tariffs for electricity 
from renewable energy sources based on the current state of development and profitability. It is also expected to include new incentives to make hydro more popular. This is due in 
December 2007 and will provide the basis for a further revi ew of the Act in 2008.  
 The Government has given initial indications of suitable sites for wind farms. There is a pilot 
geothermal plant which has been in operation si nce 2004. Three more pl ants are expected to 
come on line before the end of 2007.   
Greece Price regulation (feed-in tariff): with a 10 year guarantee which can be extended by up to 10 
years upon a producer's unilateral declaration to the responsible Operator. The prices for 2007 
were: 
• Offshore wind got 92.82 €MWh 
• PV got 452.82 €MWh if interconnected and 502.82 €MWh for non-connected islands 
• Solar (other than PV) ≤5MW got 252.82 €MWh if interconnected and 272.82 €MWh if on 
a non-connected island.  
• Solar (other than PV) ≥5MW got 232.82 €MWh if connected and 252.82 €MWh if on a 
non-connected island.  
• Onshore wind, hydro up to 15MW, geothermal, biomass, biogas and others got 75.82 
€MWh for interconnected systems and 87.42€MWh for non-interconnected islands.  
 
Subsidy for electricity from renewable energy sources:  public aid is provided for capital 
electricity from renewable energy sources investments of 20, 30 and 40% depending on which 
zone of Greece the electricity from renewable energy sources system is in. The grant is 
increased by 10% for medium businesses and 20 % for small businesses. For investments in 
solar and wind the grant amounts to 40% of costs (including any mark-up).  
 
 
EN 49   EN 2nd (2002) and 3rd (2004) Community Support Frameworks  funding for electricity from 
renewable energy sources totalled respectively €196.40m with a total public expenditure of 
€79.9m and €735.79m with a public expenditure of €252.70m.   
Subsidy for PV:  currently being developed based on public aid from domestic and 
Community resources under the Nationa l Strategic Reference Framework. 
 
Spain Premiums  for electricity from renewable energy so urces which depend on the size of the 
plant and the type of electricity  from renewable energy sources.  
The financial incentive for biomass used to produce electricity was increased.  
The Renewable Energies Plan 2005-2010 allocated €6.2m for solar thermal projects from 
2006 onwards.  
From 2006-2010 there is aid for PV not connected to the grid via the Autonomous Regions and tariffs, incentives and premiums for connected PV.  
Finland Tax benefits: the introduction of emissions trading in 2005 prompted changes to the support 
schemes in Finland. Tax benefit for electricity generated from wood and wood-based fuels, 
waste gas from metallurgical processes and chem ical reaction heat were discontinued in early 
2007. (Subsidies for wind, small hydro, recycled fuels, forest processed chips and biogas was 
retained).  
Subsidies: for renewable energy investments in the emissions trading sector were suspended 
other than for innovative technology projects. Aid continues to be granted outside the 
emissions trading sector. Aid for wind energy investment is only available for projects using innovative technology.  
Feed-in tariff: a Bill including a feed-in tariff for biogas plants under 20MW is due to be 
submitted to Parliament during the Spring 2008 session. The scheme will include field biomass, slaughterhouse waste, various manures or municipal waste as fuel.  
The use of new support schemes or a possible extension of existing ones (i.e. feed-in tariff) 
will be reconsidered if the current measures fa il to promote electricity from renewable energy 
sources sufficiently. Finland is preparing a Climate and Energy Strategy which should be 
ready by 2008.  
France Price regulation (tarif d'achat)  obligation to buy electricity from renewable energy sources. 
There is a guaranteed price (h igher than the market price) which electricity from renewable 
energy sources producers are entitled to. This price is guaranteed for 15-20 years depending 
on the type of electricity from renewable energy sources. In 20 06 and 2007 the prices were 
adjusted to reflect the costs of investment an d exploitation. Bonuses can also be granted to 
take account of positive effects on air quality, reducing CO2 and the development of future 
technologies. Only wind farms which are in identified zones are entitled to support. These 
zones are defined on the basis of the community concerned, so not just the potential for wind power but also taking account of the environment, historical monuments and protected sites.  
The tariffs are: 
• Hydro for 20 years at 6.07ct€/kWh plus a bonus of 0.5-2.5 ct€/kWh for small installations 
and a bonus of 0-1.68 ct€/kWh in winter.  
• Biogas for 15 years at 7.5-9 ct€/kWh with a bonus for energy efficiency at 0-3 ct€/kWh 
and a 2 ct€/kWh bonus for methanisation.  
• Onshore wind for 15 years: 8.2 ct€/kWh for 10 years and 2.8-8.2 ct€/kWh for 5 years, 
according to the site.  
• Offshore wind for 20 years: 13 ct€/kWh for 10 years and between 3-13 ct€/kWh for the 
next 10 years, according to the site.  
• PV for 20 years. In Metropolitan France get 30 ct€/kWh plus a bonus of 25 ct€/kWh for 
grid integration. In the overseas departments it is 40 ct€/kWh plus a bonus of 15 ct€/kWh 
for grid integration.  
• Geothermal for 15 years. In Metropolitan France it is 12 ct€/kWh plus an energy 
efficiency bonus of 0-3 ct€/kWh. In the overseas departments it is 10 ct€/kWh plus an 
energy efficiency bonu s of 0-3 ct€/kWh.  
Invitations to tender (appels d'offres) for wind, biomass and biogas, producers benefit from 
a fixed price agreed through the contract.  
 
EN 50   EN Crédit d'impôt a reduction of up to 40% of tax on equipment used for electricity from 
renewable energy sources development.  
Hungary Price regulation: there are fixed prices for electric ity from renewable energy sources 
dependent on the type of technology and the season (electricity from renewable energy 
sources affected by the weather has a fixed price but electricity from renewable energy 
sources not affected by the weather has a seasonal  price to keep its average price at the same 
amount). The prices are amended annually accord ing to the rate of inflation. Mandatory 
acceptance is valid for the retu rn of a given investment. Th e highest starting value for a 
subsidised price is 26.46 HUF/kWh as of 1 January 2008.  
Investment subsidies:  the Energy Conservation programme is a competitive tender system 
for energy conservation includin g electricity from renewable en ergy sources. In 2007 2.6bn 
HUF was granted as subsidies and 16bn HUF was loaned on favourable terms. The 
Environmental and Infrastructure Operative programme and EU Structural Funds provided 3.35bn HUF of subsidies for electricity from renewable energy sources in 2004-6. More 
funding is available for 2007-2013. The New Rural Development Strategic Plan supports 
biomass and biogas. Loans: the Energy Conservation Fund grants loans with favourable interest.  
Ireland Ireland is in the process of replacing its quota based tendering programme with a feed-in tariff 
programme. (Feed-in tariff was approved by the European Commission in September 2007).  
Italy The measures being taken to achieve the objec tives have undergone various amendments, all 
with the aim of strengthening policy in favour of renewables.  
Lithuania Purchase obligation  and feed-in tariffs  for electricity from re newable energy sources 
approximately 3 times higher than the average el ectricity sale price from the Ignalina Nuclear 
Power Plant. The prices are guar anteed until 2020 and are adjust ed according to inflation. In 
2007 they were:  
• hydro <10MW 5.79 ct€/kWh;  
• wind 6.37 ct€/kWh;  
• biomass 5.79 ct€/kWh.  
On 1 January the feed-in tari ffs will be revised and augmented. For plants commissioned 
before 1 January 2008 that use Biofuels to ge nerate electricity will receive 6.37ct€/kWh and 
those commissioned after 1 January 2008 will receive 6.95ct€/kWh. (A s of 1 January the 
purchase price of electricity is 5.79ct€/kWh).  
Lithuania Environmen tal Investment Fund  (funded by 30% of an environmental pollution 
tax) provides soft loans for projects to reduce the impact of economic activities on the 
environment. The maximum loan per project is 1.5m LTL over a maximum of 5 years. 
Subsidies must not exceed 350,000  LTL (per recipient, per 3 y ears) to a maximum of 70% of 
the costs. 
Ministry of Agriculture and Rural Development Programme  for 2007-2013 promotes 
wind farms under 250kWh on farmland provided the electricity is used in agricultural 
processes. Up to 40% of costs are available (or 50% for young farmers who meet prescribed 
criteria).  
Latvia Price regulation: compulsory purchase for hydro, wind, biogas and biomass. There are 
annual quotas for the compulsory purchase of electricity from renewa ble energy sources for 
the 2007-2010 period. The compulsory purchase of electricity from renewable energy sources 
from biomass plants up to 4MW; and biogas and hydro power plants up to 5MW; and wind farms under 0.25MW price formulae are applied.  
Wind farms over 0.25MW use a tendering process in which the lowest-price principle applies. 
(A call for tender was issued on 5 March 2008 and closes on 30 Decemb er 2008 the starting 
price has been set at LVL 70.2804/MWh). For biomass plants over 4MW the selling price is 
set by the Public Utilities Commission. The price of electricity from renewable energy sources 
which operators do not have the right to sell within a compulsory purchase framework is determined by agreement between the op erator and any electricity market.  
Luxembourg Feed-in Tariff and a purchase obligation for wind, hydro, biomass and biogas.  
There is an aid regime for LU citizens wh o produce electricity fro m renewable energy 
sources.  
Malta Financial support mechanism capital grants of 25% of the purchase price for micro-wind 
turbines up to 3.7kW (maximum grant €233); 20% grant for solar PV installations between 1-
3.7kWp (maximum grant €1,166 with an additional €582 for every additional kWp (±5%) 
 
EN 51   EN above 1kWp and the cost of installing the metr e to operate the plant has been waived).  
Net metering for electricity from renewa ble energy sources electricity with a spill tariff of 
7ct€/kWh for any excess electricity fed into the grid.  Malta published a draft renewable energy polic y for public consultation in August 2006 (an 
energy policy consultation was also launched in 2006). The Renewable Energy policy will: set 
goals; put appropriate support schemes and regu latory measures in place; and encourage 
investment and public participation.  
A call for expressions of interest for a deep offshore wind farm (75-100MW) was issued in 
2006 on a public, private partnership basis. It is unlikely that such a project would be built before 2010.  
Netherlands Decree on promoting sustainable energy production:  subsidy provision for electricity from 
renewable energy sources. Each year the Mini ster for Economic Affairs sets a maximum 
budget for the subsidies. Guaranteed prices fo r 10 years although this time period can be 
shortened or lengthened. The subsidy covers the actual unprofitable tip of electricity from 
renewable energy sources.  
Energy research subsidy:  the budget is set annually and is  allocated via a tender process.  
Energy Investment Allowance:  a tax incentive scheme allowing electricity from renewable 
energy sources projects to deduct a certain percentage of the purchase value from the taxable 
profits.  Green Investment:  a electricity from renewable energy sources investor can obtain finance 
from a fund on favourable terms (1-2% below project financing).  
Poland Green certificates obligation  energy companies selling electric ity are required to present a 
certain number of green certificates or pay s ubstitution fees. There is an obligation to buy 
electricity from renewable energy sour ces at the average market price.  
Grants and preferential loans  are available from the Nationa l Environment Protection and 
Water Management Fund and provincial funds for electricity from renewable energy sources 
investments.  
The Infrastructure and Envi ronment Operational Fund  supports construction or capacity 
expansion of wind, hydro up to 10MW, biogas and biomass projects and heat generating 
stations using solar or geothermal energy.  
Portugal Tariffs for electricity from renewable energy sources :  
• Wind 74-75€/MWh;  
• hydro 75-77€/MWh;  
• PV 310- 317€/MWh;  
• solar-thermal 267-273€/MWh;  
• PV microgeneration 355-470€/MWh;  
• biomass 102-109€/MWh;  
• biogas 102-117€/MWh;  
• municipal waste incineration 53-54€/MWh;  
• wave (demonstration to co mmercial) 76-260€/MWh.  
In 2005 a public tender was issued for 1,800MW to be supplied from wind farms. In 2006 a 
public tender was issued for 100MW to be supplied from 15 forest biomass plants. Contracts for 922MW of new hydro were issued at a co st of €1bn. A licence was awarded for a 76GWh 
PV plant. Operation commenced on the world's first wave-power plant (4MW).  
Romania Obligatory quota system and a green certificate trading scheme:  a green certificate is 
provided for each MW of electricity from rene wable energy sources and can be traded in a 
competitive market (prices must fall between €24-42 up to 2012). Annual obligatory quotas 
for green certificates have been  established up until 2012. Wind, solar, geothermal, biomass, 
wave and hydro ≤10MW are eligible. The quotas for electricity from renewable energy 
sources are: 0.7% in 2005; 2.22% in2006; 3.74% in 2007; 5.26% in 2008; 6.78% in 2009; 
8.3% in 2010-2012.  
If a supplier acquires more GCs than necessary to meet the quota they can sell them to another 
supplier (this is at the price the seller acquired them  at). In 2007 the average sale price of a GC 
on the market was €42. [This is the high est price that they can be sold at].  
 
EN 52   EN Sweden Quota system  electricity certificate scheme extended until 2030.  
Market introduction aid for wind power. Ares of national interest for wind power have been 
designated. Aid for municipal wind power planning. Four national wind power coordinators have been nominated. New planning targets for wind up to 2020 are being considered. 
Slovenia Price regulation: electricity from renewabl e energy sources producers can choose between a 
guaranteed price (according to a uniform annual price), independent sale on the market, or a 
uniform annual premium (a single or dual tariff settlement can also be chosen). The tariffs 
(not including 20% VAT) are:  
• hydro annual price 0.05938-0.06155 €/kWh or annual premium of 0.02182-
0.02399€/kWh;  
• biomass annual price 0.09118-0.09410€/kWh or annual premium 0.05362-0.05654€/kWh; 
• wind annual price 0.05863-0.06072€/kWh or annual premium 0.02107-0.02316€/kWh; 
• geothermal annual price 0.05863 or annual premium 0.02107; 
• solar annual price 0.37419 or annual premium 0.33663; 
other electricity from renewable energy sources annual price 0.12089 or annual premium 
0.08333. 
Slovak 
Republic Fixed purchase prices  for up to 12 years. Network operators must preferentially purchase 
electricity from renewable energy  sources to cover their losses.  The electricity from renewable 
energy sources prices fr om April 2008 are:  
• hydro 2000-8410 SKK/MWh;  
• solar 8410 SKK/MWh;  
• wind 2000-2940 SKK/MWh;  
• geothermal 3680 SKK/MWh;  
• biomass 2190-3600 SKK/MWh; and  
• biogas 2630-4310 SKK/MWh.  
If a electricity from renewable energy sources plant constructed after 1 January 2005 received 
state or EU aid the tariffs reduce as follows:  
• 30% aid leads to a 4% reduction;  
• 40% to an 8%;  
• 50% to a 12%; and  
• above 50% to a 16% reduction.  
United 
Kingdom Renewables Obligation  on all electricity suppliers in GB to supply a specific proportion of 
electricity from electricity from renewable energy sources or to pay a penalty buy-out price. 
The quota is 7.9% in 2007/08 augmenting in steps to 15.4% by 2015 (it will remain at that 
level until 2027). Certificates ar e issued for each MW of elect ricity from renewable energy 
sources produced. Banding of the Renewables Obligation will be introduced to bring forward 
technologies currently further from commercial deployment such as offshore wind, marine 
and tidal and Advanced Conversion Technologies.  
Exemption from Climate Change Levy  electricity from renewable energy sources producers 
do not have to pay.  
Capital grants 
Some support is available to small hydro under the Low Carbon Buildings Programme. 
£600m over 10 years will be provided by BP, Ca terpillar, EDF, E.ON, Rolls Royce, Shell and 
the UK Government to the Energy Technologies Institute for wave and tidal power.  
The Research Council Energy Programme's budget is expected to rise to over £70m p.a. by 
2007-2009.  The UK is carrying out a feasibility study for a tidal power development in the Severn Estuary 
which could provide up to 5% of the UK's electricity.  
Source: Member States' 2007 Reports  
 
EN 53   EN ANNEX B: REVIEW OF THE PROGRESS IN DIFFERENT RENEWABLE ELECTRICITY 
TECHNOLOGIES  
This data is drawn from Member States' repor ts, with graphs from Eurostat/Fraunhofer ISI " 
Electricity from renewable energy sources 2006 breakdown of norm alised renewable 
electricity in 2006 ".  
Wind power 
Electricity generation from wind in the EU-15 Member States from 1990 to 2006.  
010,00020,00030,00040,00050,00060,00070,00080,00090,000
1990 1991 1992 19931994 1995 1996
1997 19981999 2000 20012002 2003 2004 2005 2006Electricity generation from wind [GWh]LU
FI
IE
BE
FR
SE
AT
GR
PT
IT
UK
NL
DK
ES
DE 
Electricity generation from wind in th e EU-12 Member States from 1990 to 2006.  
050100150200250300350400450500
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006Electricity generation from wind [GWh]HR
BG
MT
CY
LT
SI
SK
HU
EE
CZ
LV
PL
 
 
EN 54   EN At the end of 2006 Germany was the world le ader in wind power w ith 18,685 wind turbines 
operating at a combined capacity of 20,622 MW  producing 30,500 GWh of electricity, equal 
to 5% of Germany's tota l electricity consumption.77 In 2006 wind power in Germany 
accounted for 41.3% of total electricity from  renewable sources. Wind power development 
will continue in Germany with an increased focus on offshore wind. 
In 2006, nearly two thirds (61%) of Denmark's electricity from rene wable energy sources 
came from wind power (6,108 GWh). This account s for 16.8% of Denmark's total energy. It 
should be noted that 2006 was a poor year  for wind in Denmark. In 2005 6,613.8 GWh were 
produced which accounted for 62% of electricity from renewable energy sources or 17.5% of 
total electricity consumption. S ubsidies for onshore wind farms were increased in February 
2008. 1300 MW of new wind farms capacity is expected by 2012.  
Other Member States which ha ve significantly developed wi nd power generation over the 
past few years include: 
• Spain with a wind-based growth in 20 06 of 18% (1820 MW new capacity); and  
• the Netherlands who have already achieved  their 2001 goal to bu ild 1500 MW of wind 
power by 2010; and is now aiming to install 4000 MW by 2011.  
And the following Member States have significant plans for new wind capacity: 
• Belgium has identified a 200km2 zone for o ffshore wind farm which could potentially 
provide 2,000 MW. 
• Construction has started on Europe's larges t onshore wind farm (322 MW) in Scotland. 
Construction of 450 MW of offshore is also underway. A further 2.5GW has been 
consented, including the world's larg est offshore wind farm (1GW).  
• Luxembourg envisages increasing its wind powe r fifteen-fold to meet its 2010 target of 
5.7% electricity from renewable energy sour ces. (There were 58 GWh in 2006 which 
accounted for 21% of electricity from re newable energy sources and 0.7% of total 
electricity consumption).  
The following Member States have put limits on the amount of electricity produced from 
wind power:  
• Estonia  will have a limit on wind power from 2009. Ai d will only be available for the first 
400 GWh per annum and the purchase obligati on will only apply to the first 200 GWh. 
Electricity produced above these limits will be sold at market price. This is because there 
are no power stations which can  be rapidly regulated in Est onia. In order to cover peak 
loads and extend the use of wind power. 
• Hungary has a limit of 330 MW for wind pow er due to problems in regulating the 
electricity system.  
• Wind power generation almost doubled in Czech Republic between 2005 and 2006 to 49.4 
GWh (in 2006 there was 43.5 MW of installe d capacity). However, the Czech Republic 
views that there should be no more than 600-700 MW installed wind power capacity as it 
increases the need for backup sources and th e large-scale construc tions create bottlenecks 
and congest lines. Therefore, rising installed capacity will be accompanied by a reduction in financial support.  
                                                
 
77 In the first half of 2007 there were 19,024  turbines with a total capacity of 21,283 MW 
 
EN 55   EN Solar Photovoltaic and Thermal electric 
05001,0001,5002,0002,500
1990 1992 1994 1996 1998 2000 2002 2004 2006Electricity generation from PV [GWh]LU
FI
IE
BE
FR
SE
AT
GR
PT
IT
UK
NL
DK
ES
DE
Electricity generation from PV in the EU-15 Member States from 1990 to 2006 
Germany has the largest PV market in the wo rld. At the end of 2006 Germany had the most 
installed PV (2,831 MW or 2,000 GWh) with a fourfold production increase between 2004 
and 2006.  
As of 2006, Spain has the second most instal led capacity within th e EU-27 with 144 MW. 
Spain's Renewable Energies Plan (2005-2010) aims  to install 363 MW of solarvoltaic energy 
(10 times that of December 2004) in order to  reach a target of 400 MW by 2010. Between 
2006-2010 investment aid is available for PV is olated from the grid  and operating aid is 
available for PV connected to the grid.  
The Portuguese Government has granted a licen ce for a 76 GWh per annum PV power plant 
which will be the largest in Europe.  
Luxembourg aims to have 80 GWh of PV by 2010. Due to financial support scheme there was 
a boom between 2002 and 2004 from 1.6 MW to 23.5 MW. (In 2006 there were 23.7 MW).  
Greece expected to have 1.3 MW of registered  Photovoltaic capacity by early 2008. However, 
there are many non-registered PV systems as they are exempt from the licensing obligation. On the basis of electricity sales Greece estima tes that the total inst alled capacity of PV 
systems by early 2008 would be 5 MW.  
 
EN 56   EN Biomass 
Electricity generation from solid biomass, biogas and municipal solid waste in the EU-27 
Member States from 1990 to 2006  
010,00020,00030,00040,00050,00060,00070,00080,00090,000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006Biomass electricity generation [GWh]Biowaste
Biogas
Solid biomass
 
In 2006, Germany produced the most electricity from renewable energy sources from biomass 
of the EU-27 with 17,900 GWh providing 3.3% of  total electricity consumption (27% of 
Germany's total electricity from renewable energy sources).  
Other Member States which have significantly  developed biomass generation over the past 
few years include: 
• Sweden who's energy certification scheme ha s been extremely effective in increasing 
production of existing biomass-fuelled plants (3,440 GWh increase) and has stimulated the 
construction of new plants (721 GWh increase) between May 2003 and Sept 2007. 
• The Flanders region of Belgiu m where 55% (1,638 GWh) of electricity from renewable 
energy sources came from biomass in 2007.  
And the following Member States have significant plans for new biomass capacity: 
• The UK's largest biomass plant was commissioned in 2007 (44 MW).  
• To meet its 2010 target (5.7%) Luxembourg envisages increasing its biogas production 
208-fold.  
• In Denmark as of February 2008 increased subsidies for biomass and biogas. The self 
sufficiency rule for waste incineration has been repealed. A 700,000 tonne use of straw and 
timber is expected by 2011 equiva lent to an increase in the total RE shar e of 1.2 percentage 
points. 
The following Member States have had problems with increasing electricity from renewable 
energy sources from biomass: 
• In Finland, there have been problems regardin g authorisation for recycled fuel plants. 
Construction halted due to repeated appe als against environmental and construction 
permits following the entry into force of the Waste Incineration Direc tive. Finland intends 
to seek a uniform interpretation to the Directiv e. Further to this, in Finland the introduction 
of emissions trading in 2005 prompted change s to the subsidy mechan isms for electricity 
 
EN 57   EN from renewable energy sources. The tax be nefit for wood, wood-based fuels, waste gas 
from metallurgical processes and chemical r eaction heat were disc ontinued in early 2007. 
• In Czech Republic biomass is the most tech nically exploitable renewable energy source. 
However, biomass forestry for energy purposes  is only effective up to a range of 50km 
from the proposed site of use. Biomass is also limited by the area of land available on 
account of food security. In 2006 285 GWh was supplied to the grid from biomass (up 
from 210 GWh in 2005). There is also a lack of feed-in tariff stability for the use of energy 
crops for electricity and heat in Czech Republic.  
• In Spain the expansion of biomass could no t take place in 2006 as an expected Royal 
Decree was not published. The lack of suitable incentives has prevented biomass 
development over recent years due to an expectation that there will be substantial changes in remuneration for biomass projects.  
Hydro 
In 2006, 349,000 GWh were produced by hydropow er in Austria. (The average annual 
generation is slightly more at 364,000 GWh). Au stria noted that in th e future hydro power 
will be significantly influenced not only by cl imatic changes but also by the implementation 
of the Water Framework Directive (2006/60/EC).  The intensity of future requirements for 
decommissioning hydro generating st ations and residual water flow  may lead to a 5-15% fall 
in hydro power production in Austria.  
In 2006, in Germany, 21,636 GWh was produced fr om hydro plants (98% of which are under 
5MW). This accounts for 3.5% of total energy supply.  
In 2007 80.5% of Bulgaria's electricity from renewable energy sources came from large 
hydropower (2,827.1 GWh) and 17.8% from small hydropower. Therefore only 1.7% of RES 
came from a source other than hydro- wind po wer. In the same year 84.5% of Romania's 
electricity from renewable energy sources came from hydro (13,467 GWh). 
In Spain the increase in hydropower is behind schedule with 53MW and 54 MW increases in 
2005 and 2006 respectively compared to an objec tive of a 127 MW increase per year.  
Hydro and climate conditions 
When calculating Member States' electricity from renewable energy sources the European 
Commission uses normalised data based on the am ount of hydro produced in an average year. 
This is important because hydro generation in can fluctuate significantly year on year. For 
example, in Finland year or year differences  in the amount of hydropow er produced can be as 
much as 30-50%.  
Most renewable energy comes from hydroelectri city in Lithuania (79% from hydro plants 
over 10MW and 13% from hydro plants under 10MW ). The electricity production increases 
in April when tidal waters are used. However, in the summer when the water levels in rivers 
and ponds drop the amount of energy produced is  significantly reduced, and in some cases 
completely terminated. 
 
EN 58   EN Geothermal 
Electricity generation from geothermal sources  in the EU-15 Member States from 1990 to 
2006  
01,0002,0003,0004,0005,0006,000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006Electricity from geothermal [GWh]AT
DE
FR
PT
IT
 
Italy produces the most geothermal electric ity in the EU-27. In 2005 there was 711 MW 
installed capacity which pr oduced 5,325 GWh. The same inst alled capacity produced an 
additional 202 GWh in 2006 (5,527 GWh) and in 2007 5,569 GWh were produced.  
Wave and tidal 
In Portugal the first wave-power plant w ith a capacity of 4 MW is operational.  
A feasibility study is underway in the UK on a barrage in the rive r Severn which could 
produce up to 5% of UK electricity. 
 
EN 59   EN ANNEX C: BIOFUEL ENERGY SHARE  
Member State Biofuel share 
2003 (%) Biofuel share 
2004 (%) Biofuel share 
2005 (%) Biofuel share 
2006 (%)  
Biofuel share 
2007 (%) 
Austria 0.06 0.06 0.93 3.54 4.23 
Belgium (*) 0.00 0.00 0.00 0.01 1.07 
Bulgaria (*)    0.41 4.82 
Cyprus 0.00 0.00 0.00 No data No data  
Czech 
Republic (*) 1.09 1.00 0.05 0.42 0.50 
Denmark (*) 0.00 0.00  0.15 0.14 
Estonia 0.00 0.00 0.00 0.12  0.06 
Finland 0.11 0.11  0.02 No data 
France 0.67 0.67 0.97 1.77 3.57 
Germany 1.21 1.72 3.75 6.32 7.35 
Greece (*) 0.00 0.00  0.75 1.21 
Hungary (*) 0.00 0.00 0.07 0.28 0.20 
Ireland 0.00 0.00 0.05 0.09 0.6 
Italy 0.50 0.50 0.51 0.46 0.46 
Latvia 0.22 0.07 0.33 0.22 0.14 
Lithuania 0.00 0.02 0.72 1.72 4.35 
Luxembourg 
(*) 0.00 0.02 0.02 0.026 1.46 
Malta 0.02 0.10 0.52 0.582 1.08 
Poland 0.49 0.30 0.48 0.92 0.68 
Portugal 0.00 0.00 0.00 1.02 2.54 
Romania    0.00 0.79 
Slovakia 0.14 0.15  0.69 2.53 
Slovenia 0.00 0.06 0.35 0.275 0.83 
Spain (*) 0.35 0.38 0.44 0.53  1.11 
Sweden 1.32 2.28 2.23 3.10  4.00 
The 
Netherlands 0.03 0.01 0.02 0.29 2.00 
UK 0.0378 0.04 0.18 0.45  0.84 
EU 27 0.5(a) 0.7(a) 1.02 1.82 2.58 
(a) EU 25 
Source: Member States 2006 and 2007 reports, except (*) data for 2007 which is from EurObserver Biofuels 
Barometer  
                                                 
78 0.03% in volume terms, equating to 0.26% in energy content, assuming 100% biodiesel. 
 
EN 60   EN ANNEX D: MAIN PLANNED AND EXISTING 2ND-GENERATION BIOFUEL FACILITIES IN EUROPE  
Country Place / 
COMPANY Technology in 
operation Capacity / Production 
(Current or Forecast)  
Austria1 Gϋssing demonstration plant of 
the FT synthesis NO 
in future  This demonstration plant will be big enough to 
refuel a fleet of vehicles in the city of Güssing 
Denmark1 Kalundborg - 
GENECOR pilot cereal-to-biofuel 
facility NO 
in future 4.500 tons of cellulosic ethanol per year 
Denmark1 Bornholm - 
BIOGASOL pilot plant producing 
lignocellulosic ethanol NO 
in future 8.000 tons of cellulosic ethanol per year 
Finland1 Varkaus - 
STORA ENSO syndiesel pilot plant 
using forest residue and pulp/paper waste NO 
end of 
2008  
France3 Pomacle-
Bazancourt 
(Marne) FUTUROL 
PROJECT pilot facility in 2008  
France1 not yet defined pilot plant producing 
lignocellulosic ethanol NO 
in future  100 tons of cellulosic ethanol per year 
France1 Bure 
(Lorraine) - 
AXENS pilot plant using Fischer-
Tropsch technology NO  
in future 15.000 tons per year 
Germany2 α-plant Pilot plant converted to a 
Fisher-Tropsch unit in 
2002 1997/199
8 several tons of FT until 2005 
 
Germany2 Freiberg - 
UET/CHOREN first commercial BtL 
plant (β-plant) YES 
from 2007 45 MW (360 barrel per day) 
from 2008: 15000 t/a of BtL 
Germany2 CHOREN standard production plant NO 
2011 200.000 t/a BtL (5000 barrels per day) fuel 
Germany2 Karlsruhe - 
FZK Pyrolysis pilot plant YES  
end of 
2007 capacity of 500 kg biomass per hour (2 MW) 
Sweden2 Hofors Pilot and demonstration 
black liquor gasification 
plant 1987 0.5 MW 
 
Sweden2 Skogall pressurized (15 bar) air-
blown pilot plant  
built in 
1994 
modified 
in 1997 1 MW 
 
Sweden2 Pitea - Sodra pressurized, 30 bar 
oxygen-blown development gasifier YES 
2005 
 3 MW 
Volvo is planning a test fleet of about 15 heavy duty trucks to be ready for the end of 2009. 
DME for this fleet is planned to be produced 
from gas from the DP-1 plant in Piteå which then will be equipped with a pilot plant for 
DME production with a capacity in the order of 
4-5 tons/day 
Sweden2 not yet defined BLGMF (Black Liquor 
Gasificator for Motor 
Fuel) end of 
2010 25,000 tons/year of fuel grade DME equivalent 
to ~17,000 t diesel/year 
Sweden2 not yet defined 2 BLGMF demonstration 
plants end of 
2010 
Sweden2 not yet defined 3 small BLGMF plants 2014- 
2018 
Sweden2 not yet defined 5 large BLGMF plants 2012 - The production calculated for all Swedish plants 
at the end of 2020 is almost 600.000 Ton diesel Oil Equiv. Per year  
 
EN 61   EN Country Place / 
COMPANY Technology in 
operation Capacity / Production 
(Current or Forecast)  
2020 
Sweden1 Örnsköldsvik - 
SEKAB pilot plant producing 
lignocellulosic ethanol YES 
2005 100 tons of cellulosic ethanol per year 
 
Spain1 Babilafuente - 
ABENGOA 
BIOENERGY pilot plant producing 
lignocellulosic ethanol YES 
2007 4000 tons of cellulosic ethanol per year 
 
The 
Netherlands1 Sas Van Gent 
- ROYAL NEDALCO pilot plant producing 
lignocellulosic ethanol in future  160.000 tons of cellulosic ethanol per year 
Source : 
1) IFP Innovation Energy Environment Panorama 2008 -“2nd generation pilot biofuel units worldwide 
2) Renewable Fuels for advanced Powertrains, Final Report. Renew 2008 
3) FUTUROL PROJECT