SMALL HYDROPOWER POLICY FRAMEWORK IN THE NEW EU MEMBER by smx43008

VIEWS: 15 PAGES: 47

									     Bled, Slovenia 15 – 17 October 2007


    SMALL HYDROPOWER POLICY
FRAMEWORK IN THE NEW EU MEMBER
 STATES AND ASSOCIATED COUNTRIES

                 Petras PUNYS

 Lithuanian Hydropower Association / University
                of Agriculture
                             Contents
Background
  METHODOLOGY of ANALYSIS
 SHP at a GLANCE
 SHP ELECTRICITY CONTRIBUTION for ACHIEVING RES-E
  DIRECTIVE TARGET
 ADMINISTRATIVE PROCEDURES
       Water rights (concession), power generation licences
       Market barriers
       Environmental legislation
   SHP SUPPORTING POLICY
       Instruments to support SHP electricity
       SHP market perception of support schemes
       Attractiveness of private investments and commercial security
 SOCIAL BARRIERS AND PUBLIC ACCEPTANCE
    Conclusions
Background
 Ongoing project “Small Hydro Energy Efficient
    Promotion Campaign Action” (SHERPA)
        Coordinator ESHA: 2006-2008,
   Funded by Intelligent Energy for Europe
                   programme

Work package 2 “Status of SHP policy framework
    and market development in EU27“ to be
          completed by October 2008
Swedish Renewable Energies Association (SERO): Old EU
                 Member States (EU15)

 Lithuanian Hydropower Association: New EU Member
        States (EU12) + Candidate countries (CC)
The main activities covered in WP2 have been:

Assessing the potential for future SHP
development, both in terms of upgrading the old
existing plants and building new sites.

Gathering data on the actual state-of-the–art of
the SHP development in the EU12 +CC5.

Analysing the policy framework in each country,
putting emphasis on the constraints that are
hindering the development of SHP plants.
        Yellow - Pre-May 1, 2004 EU Members (EU15);
 Blue - May 1, 2004 and January 1, 2007 New Member States
(EU12); Lavender - Post-January 1, 2007 Candidate Countries
                            (CC5).
Methodology of analysis
 Already existing studies

   ESHA data base, EuroStat, International Journal
on Hydropower & Dams (2006), World Energy Council
(2004), IEA (2004) , EREC (2004), ECOFYS (2006),
EBRD (2005) ect.

    Survey of SHP situation:

10 new EU MS (except Cyprus and Malta) + 5 Candidate
   countries . Reference year: 2006

     Information sources of the study
Outline questionnaire (69 questions)
             Environmental                    Granting
                  law                        procedures



Energy law             LEGAL FRAMEWORK                Water rights




                             Power pricing




        Small Hydropower legal framework
SHP at a glance
                          0.050
                                                 1 st
Specific power GWh/year


                          0.040

                          0.030

                          0.020

                          0.010

                          0.000




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      Small hydropower specific energy (economically
            feasible potential) in GWh/year/km2
           (annual energy divided by the area of a country)
                                                                13 400                               30 000 19760
                         6000
                                Gross t heoret ical
                                Technical f easible                            2nd                  1 st
SHP potential GWh/year




                                Economically f easible
                         4000
                                Developed



                         2000



                            0
                                BG   CZ     EE        HU   LV   LT   PO   RO   SK    SI   BA   HR    MK    ME   TR




                          Small hydropower potential (gross theoretical,
                             technically and economically feasible
                                    potential) in GWh/year
                1400                                                                          400
                                                                         Number of SHP
                                                                                              350




                                                                                                    SHP installed capacity MW
                1200                                                     Installed capacity
                                                                                              300
                1000
Number of SHP




                                                                                              250
                800
                                                                                              200
                600
                                                                                              150
                400
                                                                                              100
                200                                                                           50
                  0                                                                           0
                       BG CZ   EE   HU   LV   LT   PO RO SK   SI   BA   HR MK ME        TR




                Number of SHP plants and installed capacity
                                    2.5                                                Slovenia & Macedonia
Contribution to gross electricity




                                    2.0
         production %




                                    1.5


                                    1.0


                                    0.5


                                    0.0
                                          BG   CZ   EE   HU   LV   LT   PO   RO   SK    SI   BA   HR   MK   ME   TR




            SHP contribution to gross electricity generation
                                                                                                             Small Hydro
                                                                     Other renewables
                                     100.0
                                                  Large Hydro
Renewable electricity production %



                                                  Small Hydro
                                      80.0        Other Renewables


                                      60.0


                                      40.0


                                      20.0


                                       0.0
                                             BG     CZ    EE    HU   LV   LT   PO   RO   SK   SI   BA   HR    MK   ME   TR




   Share of large and small hydro, and other
renewable energy sources in the total renewable
              electricity generation
SHP electricity contribution for
  achieving RES-E Directive
         (2001/77/EC) target


 Renewable Electricity Directive (RES-E) is a policy tool to
assist the EU in the development of sustainable energy sector
                                50          SHP 1997
 National indicative target %               SHP 2004
                                40          SHP 2006
                                            Large Hydro 2006
                                30          TARGET 2010

                                20


                                10


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Actual contribution of SHP electricity in 1997,
2004 and 2006 versus 2010 target (as set in the
    RES-E Directive) for EU-12 countries
                                                           SHP 1997
National indicative target % (without Large Hydro)
                                                     12

                                                           SHP 2004
                                                           SHP 2006
                                                     8     TARGET 2010 (without Large Hydro)



                                                     4




                                                     0
                                                          Bulgaria    Czech     Estonia   Hungary   Latvia   Lithuania   Poland   Romania   Slovakia   Slovenia
                                                                     Republic




                                                      Actual contribution of SHP electricity in 1997,
                                                      2004 and 2006 versus 2010 target (as set in the
                                                          RES-E Directive) for EU-12 countries
                 SHP generators:
National Targets 2010 will most likely not be met
       (neither will New Renewables) !!!


  Main cause: risks due to uncertainties in the
              policy framework
•Key barriers:
  •administrative, environmental, financial and
  social nature
Administrative procedures
                 Environmental                     Grid related
                    barriers                        barriers



Administrative           MAIN BARRIERS FOR THE             Financial barriers
and regulatory            DEVELOPMENT OF SHP



                                 Social barriers




                   Classification of barriers
     Administrative and regulatory
              barriers:
1) high number of authorities involved (no
   “one–stop shop” for SHP developers in all
   countries);
2) lack of co-ordination between different
   authorities;
3) long      lead-times to obtain permits or
   licenses; spatial planning;
4) SHP insufficiently taken into account in
   spatial planning;
Water rights (concession), power
      generation licences
Water rights (“water permit, site right etc”)

10 years (Bulgaria) up to 30-50 and more years
(Lithuania, Slovenia, Slovakia) with possible
renewal.

The optimal duration should be at least 30 years.


No reversion principle (when concession rights go
back to the state)
  The length of validation of power generation
                    licenses:

 5 years (Estonia), 10 years (Latvia, Macedonia),
20-30 (the Czech Republic, Bosnia and
Herzegovina), 35 (Bulgaria) and 49 years
(Turkey)

The whole process to get licenses takes from 3-6
months in Poland and Estonia (without the time
required to carry out EIA) to 1-2 years in the
remaining countries.
Market barriers
                                                                                        Perception




                                                                                0
                                                                                    1
                                                                                         2
                                                                                              3
                                                                                                     4
                                                                                                         5
                                                    Market perception of the
                                                      costs of electricity



                                                  Lack of funding or financing



                                                  Lack of experience among
                                                      decision makers
                                                                                                                       1. Decision makers




                                                  Lack of experience among
                                                     banks or investors



                                                    Lack of experience in the
                                                         SHP industry


                                                     Lack of awareness of
                                                   multipurpose uses of SHP
                                                            plants



                                                             Buy-back rates




                                                       Infrastructural barriers
                                                                                                                      3. Power pricing




                                                     Electricity resource is
                                                   remote from areas of high
                                                      electricity demand



                                                       Administrative barriers




                                                               Legal barriers
Perception of general market barriers in EU-12
countries (1=no barrier….. 5=very high barrier)
                                                                                                                  barriers




                                                   Social acceptance and/or
                                                          awareness
                                                                                                             2. Administrative
      Market barriers (EU12 +CC)
     (out of 12 listed barriers on the 5 point scale:
            1=no barrier….5=very high barrier )

Most significant:

a) Lack of experience among decision makers - 3.6
   (not a problem in Turkey -2);
b) Lack of experience / trust among banks or investors
   -3.4 (Lithuania -2);
c) Lack of funding or financing - 3.2 (Croatia -1,
   Lithuania -2);
d) Administrative barriers -3.3 (Estonia and Latvia -
   2);
e) Low buy-back rates -3.2 (Estonia and Croatia -1).
Less significant:

a) Social acceptance and/or public awareness - 2.8 (the
   Czech Republic, Poland and Slovenia - 4);

b) Market perception of the costs of electricity - 2.6
   (Bosnia and Herzegovina, Macedonia - 4),

c) Lack of experience in the renewable/SHP electricity
   industry - 2.4 (Macedonia - 5);

d) Remoteness of electricity from areas of high
   electricity demand -2.1 (Bosnia and Herzegovina -4).
Environmental legislation
                               Fishery                                                       Visual impact
                                                       Visual impact
                    5                                  Fishery
                                                       Water regulation
                                                       Environmental regulation
                                                       Competition w ith other uses
                                                       Other kinds or resistance
                    4
Degree of gravity




                    3



                    2



                    1
                         BG   CZ   EE   HU   LV   LT   PO       RO      SK        SI   BA   HR   MK   ME   TR



                        Resistances to SHP development (1=no impact,
                                       5=severe impact)
                    5



                    4
Degree of gravity




                    3



                    2



                    1
                        BG   CZ   EE   HU   LV   LT   PO   RO   SK   SI   BA   HR   MK   ME   TR


                    Average score of the impact of environmental
                       regulations on SHP development (1=no
                           impact……. 5=severe impact)
EU Water Framework Directive
 2000/60/EC (WFD) and SHP

 No fears: Hungary and Turkey
 No information : Bulgaria, the Czech
Republic, Romania, Bosnia and Herzegovina,
Macedonia and Turkey
 List or rivers exempt from damming
causing reduction of SHP production: Estonia,
Latvia, Lithuania
 Augmentation of environmental flow rates
(Slovenia)
 Majority of respondents: SHP development and the
WFD requirements can be reconciled.

 WFD should be considered as an opportunity for
the sector; the chance to show how SHP developments
can be integrated into the ecosystems of the rivers with
a minimum of environmental impact.

 SHP operators agree to augment environmental
flow providing the resulting losses in electricity
production do not exceed 5 %.

 Only a few respondents think that large hydro, i.e
large reservoirs would undermine the achievements of
the WFD objectives.
SHP SUPPORTING POLICY

  Instruments to support SHP electricity
       Feed in Tariffs             Quota Obligation

       BG EE CZ HU
         LT SI SK

                             PL RO LA


                     CERTIFICATE
                      SYSTEMS


                                       SK SI



         Tenders               Fiscal Incentives


Overview of primary renewable electricity support
           systems in EU-12 countries
SHP market perception of support schemes
        5


        4
Score




        3


        2


        1
            Investment   Feed in Tariff     Quota          Tax       Tendering
            incentives                    obligations   incentives    system
                                           based on
                                              TGC


  Average score of support instruments according to the
 survey in the EU12 Member States (1=least important; 5
                    =most important)
Attractiveness of private investments and
           commercial security
Electricity prices €cents/kWh


                                  14        Household
                                                                                                                        EU 15
                                  12        SHP

                                  10

                                   8

                                   6

                                   4

                                   2

                                   0
                                       BG   CZ    EE   HU   LV   LT   PO   RO   SK   SI   BA   HR   MK   ME   TR EU27 EU15 EU12 CC




                                                                                                                        EU 12

                                SHP electricity buy-back rates and electricity prices for
                                         household consumers (€cents/kWh)
                                                                                        Electricity prices €cents/kWh
1                                                                                  10
                                                                                   9
                                                                                   8
                                                                                   7
                                                                                   6
0                                                                                  5
      BG   CZ   EE   HU   LV   LT   PL   RO   SK   SI   BA    HR     MK     TR     4
                                                                                   3
                                                             Attractivness of
                                                             investments           2
                                                             Commercial security
                                                                                   1
                                                             Power price €c/kWh
-1                                                                                 0




     Attractiveness of private investments and assurance of
       commercial security of the SHP sector under the
      current support system (positive =1; negative = -1).
      SOCIAL BARRIERS AND PUBLIC
             ACCEPTANCE
 NGOs
 General public
 Politicians (e.g. Parliament)
 Officials in charge of environment
  protection
 Officials in charge of promoting RES

•
NGOs: Neutral (except         General public: positive,     Politicians: positive, less
Latvia). Positive (Croatia,   reserved (Croatia, Latvia,    active (Croatia, Latvia,
Montenegro)                   Slovenia)                     Montenegro)
           Environ. bodies: big opposition (Lithuania),
                                                                RES institutions: good
          neutral (Estonia, Latvia, Croatia), positive
                                                                or very good support
          (Poland, Bosnia.., Macedonia, Monetenegro)
      NGOs
      General public
5     Politicians
      Environm. bodies
      RES bodies
4



3



2



1



0
     BG     CZ      EE   LV    LT     PO    RO     SI      BA    HR    MK     ME     TR


    SHP acceptance (1 = very Negative….. 5 = very Positive).
CONCLUSIONS (Coming soon!!!!)
SUMMARY OF SHP MARKETS AND POLICY
  in EU27 and CC (due for release on October 2008)
1. Water Resources
2. Background (Energy situation of the country)
3. Renewable Energy Sources
      RES policy: Supporting Policies + RES-E targets
      RES market status
4. SHP within the electricity and RES-E mix
      Current status of SHP
      SHP Potential
      SHP Policy Framework
5. SHP Sector Development
      Impact of EU Directives (Water framework, RES-E)
      SHP Economic Issues
      SHP manufacturing Industries
      Technological advancements
      Environmental integration
      Social and Public Acceptance
Bled, Slovenia 15 – 17 October 2007




  Thank you for attention !

								
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