Renewables predicted to reach 109GW by 2010
The authors of a new study have predicted that renewable energy in Europe will annually increase its revenues by 12% and installed capacity by 13% between 2001 and 2020.
The study, by market research company Frost and Sullivan, notes that the EU had envisaged biomass energy as being the main contributor to the growth in renewables, accounting for up to 75% of the total increase. However, Frost and Sullivan state that wind power will become Europe’s renewable of choice, exceeding targets by 30GW.
“The European renewable energy industry is poised for robust growth, albeit showing significant variations in performance,” said Senior Industry Analyst at Frost and Sullivan, Harald Thaler. “Comprising wind power, solar photovolaics, biomass power, small hydropower and geothermal power, the overall renewables market amassed US$4.6 billion in 2001 based on the installation of all new renewable energy equipment in Europe.”
Solar power will also increase by a further €0.8 billion, although this is lower than previously expected, says Ian French, co-author of the study. “Other sectors, such as biomass, are expected to fall short of the ambitious EU targets, with the expected small hydro capacity deviating least from the Commission’s forecasts,” he said.
With regards to biomass in particular, the growth in installed capacity of the technology reached 43.3% last year, amassing revenues worth €646 million on installations above 1MW. However, growth is predicted by the study to decline over the next few years in line with the decline in support schemes, combined with high costs, low electricity prices, and uncertainty of supply (see related story). Frost and Sullivan forecasts that the installed capacity of biomass power will reach 61.5% by 2020.
“A number of different support mechanisms and funding programmes will continue to encourage market penetration of wind power technology over the forecast period,” said Thaler. “Direct support for investment has been used to create markets for wind energy and develop a new manufacturing industry, while support for the price of electricity delivered to the public grid has been employed to stimulate markets in a number of key countries, including Germany, Denmark and Spain.”
The importance of these support schemes will become less pronounced over time as governments seek to limit the size of the incentives in order to promote competition and in response to declining wind power generation costs, says Frost and Sullivan.