Italy and Spain Forge Ahead with Renewable Energy Projects

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Researched by Industrial Info Resources (Sugar Land, Texas)--In a recent report, leading power management company GSE (Rome, Italy) stated that Italy's total installed renewable power generation capacity was about 23,859 megawatts (MW) in 2008, an increase of 21% from 2007 figures. The increase has been attributed primarily to the hydropower sector, which recorded a growth of 27%. Solar power capacity in 2008 grew at a staggering 400%, moving from 87 MW in 2007 to 431 MW in 2008. The contribution of biomass and wind energy projects to the renewable energy pool in the country increased 16% and 30%, respectively. The report also indicates that about 75% of Italy's renewable energy generation comes from the northern region. In 2008, Italy ranked fifth in the list of top global renewable energy producers.

Spain's leading power transmission company, Red Electrica Corporacion SA (MCE:REE) (Madrid), reported that by the end of 2009, more than 25% of the country's energy demand would be fulfilled by renewable energy sources. In 2008, renewable energy sources accounted for 20% of the total power generated in Spain. The growth in the contribution of renewable energy to the national energy grid will be achieved through the increase of hydropower and wind energy capacities. Spain, which had a total installed wind energy capacity of 16,740 MW in 2008, has set a target of achieving 20,000 MW of wind power generation capacity by 2010.

The focus on developing renewable energy sources in Italy and Spain comes at a time when a recently published European Union report indicates slow growth of renewable energy projects among member nations. This could present a hurdle to achieving the E.U.'s 2010 renewable energy targets set for the energy production and transportation sectors. By 2010, the E.U. hopes to achieve a 21% contribution of renewable energy to electricity generation and 5.75% contribution to transportation. The report states that in the last two years, some countries have been able to successfully commission new projects, while others have made very little progress. This may lead to the E.U. reaching only 19% and 4% of renewable energy contribution in the energy generation and transportation sectors, respectively. Lack of strong legislation and government support, administrative and procedural delays, and issues relating to access to grids have been identified as some of the impediments to achieving the E.U.'s 2010 targets.

In January last year, the E.U. announced that by 2020, renewable energy sources would contribute about 20% to the energy demand. In 2008, the contribution of alternative energy sources in the E.U. was about 8.5%. An additional target of a 10% contribution from biofuels in the transportation sector was also set, making it mandatory for every member nation to target an increase of 5.5% in biofuel contribution from 2005. The balance target was calculated and allocated to each country. Recently, the E.U. also developed and adopted a template to measure the development of renewable energy among member states. Each country will be required to finalize a specific national renewable energy development plan and a strategy to achieve the 2020 renewable energy targets.

However, Carbon Trust (London, United Kingdom) has stated that despite the efforts being made by the E.U. to increase the use of environmentally friendlier energy sources, the E.U. lags behind North America in new investments and commissioning of renewable energy projects.

In July this year, under the economic recovery scheme, the E.U. Council allocated 3.98 billion euros ($5.7 billion) for 47 new projects in the energy sector. The funding was aimed at helping the E.U. make headway in the development of green energy projects. However, the process of selecting and apportioning funds went on for months, with member nations arguing about the allocation. Finally, an agreement was reached at the E.U. Summit held in March this year. The allocation will be made as follows:

• 1.05 billion euros ($1.5 billion) for 13 carbon capture and storage projects
• 1.44 billion euros ($204.5 million) for 18 gas infrastructure projects
• 565 million euros ($802.3 million) for five offshore wind power plants
• 15 million euros ($21.3 million) towards two small island energy schemes
• 910 million euros ($1.29 billion) for nine electricity infrastructure programs

Environmentalists and industry experts indicate that no funds were set aside for solar, hydropower, biomass, geothermal and other renewable energy projects. Member states have decided that funds from the economic recovery plan that remain unspent after 2010 will be utilized for developing alternative energy projects and improving energy efficiency.

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