* EU nations focused on own subsidies, projects
* Cooperation could save money now, post-2020
* Little pressure to reach 2020 targets
* Challenge separating energy plans from jobs, politics
By Karolin Schaps
LONDON, March 14 The next twist in European
renewables policy could well be a push toward more cross-border
cooperation as slimming budgets pressure governments to tap
billions of euros in savings between now and 2020.
European Commission guidelines due this summer are expected
to include a renewed call for such cooperation, yet analysts say
it will be a challenge to steer nations away from projects that
create local jobs.
Ways to cooperate were clearly spelled out in a 2009 EU
directive on promoting renewables yet there has been little
"It's not well accepted to meet targets with the help of
foreign countries. As long as there is no pressure (from the
European Commission) to carry out cooperation, there will be no
movement," said Corinna Klessmann, managing consultant at
renewable energy consultancy Ecofys in Berlin.
Only Sweden has set up a renewable energy trading mechanism
with a neighbour - and that was with non-EU nation Norway.
Britain is in the process of signing an agreement with
Ireland to import Irish wind power and Lithuania is looking at
trading excess renewables with landlocked Luxembourg.
In the meantime, EU states will spend an estimated 41
billion euros a year in renewable energy subsidies in an effort
to reach their 2020 targets.
Yet better cooperation would allow them to save up to 7
percent of that, or 2.8 billion euros ($3.65 billion) a year,
according to an EU-sponsored study in 2011 by Technical
University Vienna, Fraunhofer Institute, Ecofys and Ernst &
That's enough money to build 1,000 onshore wind turbines and
would offer relief to EU consumers grappling with recession,
state austerity measures and shrinking spending power.
At least six EU member states - Belgium, France, Italy,
Luxembourg, the Netherlands and Slovenia - already know they
will need help to meet their individual 2020 targets but few
have made progress with cooperation agreements.
"Luxembourg is generally interested in all the forms of
cooperation," said Georges Reding, head of the sustainable
energy department at Luxembourg's economy ministry. "No
agreements have been concluded so far but discussions are
ongoing with several member states."
JOBS AND 2020
Analysts said that domestic politics have in some instances
been an obstacle, including government promises to create local
green jobs and public resentment toward projects focused
A German project to build solar plants in Greece and export
electricity they produce to Germany stalled last year after a
public outcry over spending money to create jobs in Greece
rather than at home.
"Germany is a good example of how renewable policy has been
driven as much, or possibly more, by industrial and employment
policy concerns than it has by climate policy," said Stephen
Tindale, associate fellow at the London-based Centre for
Energy experts say nations need to overcome their reluctance
to be the first to forfeit their solo efforts in favour of joint
renewable energy projects.
They argue that securing agreements would allow states to
hedge against possible price risks after 2020 should, for
example, there be a last-minute rush for cross-border help that
drives up the price of spare renewable energy.
"Starting early gives you more options later. These are
valuable to maintain when there is uncertainty around costs and
viability of meeting your targets only by investment in your own
country," said James Rydge, Dahrendorf research fellow at the
London School of Economics' Grantham Research Institute on
Climate Change and the Environment.
Others point out that governments are not as proactive as
they could be because the European Commission has not set out
how or whether it would punish governments which come up short
on 2020 green energy goals which are legally binding.
"Almost all governments are just sitting tight and not
arranging any trades, either because they have been doing quite
well on their trajectory to their 2020 targets, or through
inertia, or perhaps because they think nothing bad will happen
if they miss their targets," said David Buchan, senior research
fellow at the Oxford Institute for Energy Studies.
One Commission official who declined to be identified, said:
"Member states have to report back to us regularly by national
action plans on how they want to meet their national targets.
But we cannot say go for more trading, or do this, we can only
try to (ask them to) cooperate more."
Another hurdle is the lack of a transparent means of trading
renewable power across Europe, despite a system where renewable
power crosses borders.
When the German grid is unable to absorb locally generated
wind power output, for example, it spills power on to grids in
Poland, the Czech Republic and the Netherlands.
"The big challenge is that all the regulatory systems across
Europe are all different and renewable electricity is not traded
on the wholesale European market," said Jean-Pascal Boutin, a
partner in the energy and natural resources practice at law firm
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(Additional reporting by Barbara Lewis in Brussels; editing by