This is an extract from Ember’s recent report titled “Ready, Set, Go: Europe’s race for wind and solar”
With the gas crisis and Russia’s war in Ukraine, energy security been shooting up on the top of the EU’s agenda. Seeing the urgency of reducing dependence on imported fossil fuels, the European Commission and European Union (EU) member states have increased ambition on renewable energy. The REPowerEU proposal aims for the EU to reach at 1236 GW of renewable capacity by 2030. Analysis from Ember and CREA reveals that many national governments have also committed to expanding renewables as a way to address spiking fossil gas prices and energy security concerns. Europe is in search of cheaper and more stable power systems. Modeling from Ember highlights how this can be achieved through possible pathways to a 1.5 C aligned clean electricity system in Europe. The modeling provides insights about required wind and solar capacity for 2030. Comparing these capacities with the pace of actual deployment represents that EU countries need to accelerate the rate of wind and solar capacity additions to reach the volumes required in 2030.
The EU is moving forward with renewables ambitions. Increased targets are an important step towards adding renewables to Europe’s electricity system. However, this needs to be coupled with actual delivery through national legislation, the removal of administrative barriers, effective support schemes and increased investment.
EU’s pace of wind and solar deployment
Europe is hungry for more renewables. The EU aims for a green recovery post covid-19. Also, the pressure from continuing gas crisis and Russia’s invasion of Ukraine are encouraging countries towards cleaner, cheaper and more secure sources of power. This shift is already underway with installed capacity of wind and solar in Europe increasing from the last decade. However, rates of deployment will have to signiﬁcantly step up to keep pace with more ambitious 2030 targets.
Recent increases in solar deployment are a positive sign. However, future deployment predictions are below pathways compatible with 1.5C. In the case of wind power, both current and future deployment rates are not aligned with 1.5C compatible benchmarks or REPowerEU targets. This is especially worrying as wind’s higher capacity factor in comparison to solar reflect that delays in wind deployment will have a larger impact on the electricity generation mix.
There are different ways through which the wind and solar could grow to meet capacity requirements aligned with 1.5C. Based on discussion with developers and analysis of current growth rates, the report shows that annual additions are needed for a steep continual increase in coming years, rising to four times the 2021 levels by 2030. WindEurope and IEA forecasts provide expected additions for wind and solar respectively from 2022 – 2026. These ﬁgures highlight wind and solar capacity additions are close to the required values in 2022 and 2023. However, 2024 onwards it is reaching only half of the required trajectory of 76 GW by 2026.
At an EU level, solar capacity has seen a rapid expansion in the last three years. Starting from 104 GW to 162 GW, an exponential trend adding 15 percent every year. In order to match necessary ambition for solar capacity and REPowerEU targets by 2030, this rate must continue. However, the IEA predicts growth below this pace, with annual additions in 2026 only 46 percent of the required value.
While reaching at suﬃciently high levels of wind and solar will be a challenge across both technologies, deployment projections for wind expose a particular risk. This is because wind’s higher capacity factor means that each gigawatt of wind capacity translates to comparably more electricity generation than in the case of solar. Wind capacity has grown more slowly than solar, adding an average of 10 GW per year since 2018. To meet 1.5C aligned objectives this needs to increase. However, according to forecasts, in 2026 only 54 percent of additions required will be added.
Ember’s clean electricity system modeling provides another pathway called a ‘system change’ (SC) which is also 1.5C aligned. It aims for a European net zero energy system by 2040 in comparison to 2050 in the TD pathway. Under this scenario, wind and solar capacities in 2030 are higher, putting expected deployment rates even further behind. In 2026, combined wind and solar will hit just one third of additions required under the SC pathway.
Key countries and their wind installation rates
Many EU countries have set ambitious targets for renewable energy. These goals must now be matched with accelerated deployment. The upcoming years will be crucial in setting the pace necessary to reach a clean EU electricity system by 2035.
Across EU-27 countries, progress towards 1.5C aligned 2030 wind capacity is slow. At predicted rates of deployment, only four out of 27 countries which include Finland, Croatia, Lithuania and Sweden are set to install suﬃcient yearly capacity.
Six countries with the potential to play a key role in wind installations look set to install only half of the capacity needed in 2026. Predictions for France, Spain and the Netherlands represent a ﬂatline and decreasing installation rates to 2026. The later these countries pick up their deployment pace, the faster they will have to accelerate in the lead up to 2030. This deployment deﬁcit exposes countries to ﬁnancial losses. Least-cost pathways clearly indicate the need for rapid wind deployment which would also reduce reliance on fossil fuel imports and lower electricity prices in a time of economic struggle.
However, there have been positive recent announcements signalling that European governments are taking deployment challenges seriously. The German Easter Package lays out an ambitious deployment schedule which plans to add 10 GW per year onshore wind capacity from 2025 onwards and 19 GW of offshore wind between 2026 and 2030. This would put German deployment rates far above current predictions and on track to reach a total of 145 GW wind capacity by 2030 and aligned with 1.5C benchmarks. In Poland, the government reached preliminary agreement to update a problematic wind law which has blocked investment in onshore wind since 2016, and the ﬁrst offshore wind farm is expected to start operating in 2026.
Future solar deployment rates not 1.5C aligned
At the EU level, solar deployment rates from the previous three years seem promising. However, predictions for the next four years paint a different picture. Analysis of six key countries reveal the pace varies widely, with many falling short.
According to annual forecasts, Poland and the Netherlands are set to keep up with 1.5C aligned solar capacity additions through 2026. However, it is important to note the worrying downward trend in expected solar capacity additions due to issues such as the lack of available grid connection. Immediate priority should be on unblocking the pace of deployment in laggard countries. For instance, Italy is predicted to install only one third of the yearly required capacity between 2022 and 2026.
Delays due to permitting procedures
A long permitting process is a key reason because of which EU and several countries are deploying wind and solar too slowly. It is usually the most time-consuming phase of a renewable energy project. Permitting includes all the administrative processes required to move from an idea phase to the construction of a wind or solar power plant. It involves securing construction permits, performing environmental impact assessments, and navigating local spatial planning processes. The analysis also included the grid connection process in permitting times.
The renewables industry has been ﬂagging the time delays from administrative barriers for years. This was recently acknowledged by the European Commission in its recommendation on speeding up the permitting process. EU legislation states that permit granting should take no more than two years, but adherence to this is rare. According to information collected from developers and industry bodies, solar permitting times range from 12 months in Lithuania to 48 months in Croatia. Out of the 12 countries with available information, only three which are Belgium, Lithuania, Romania had less permitting time than the EU limit of 24 months. Combined, these 12 countries account for 91 percent of current installed solar capacity.
Onshore wind permits take even longer, ranging from 30 months in Romania to 120 months in Croatia. None of the 18 countries analysed were below the 24-month limit stated in the RED. Together, these countries make up 96 percent of current installed wind capacity.
Common issues with permitting include lack of digitalisation in the overall process, lack of resources within local authorities, delays caused by legal appeals and overlap of responsibility amongst different authorities.
The upcoming amendment of the Renewable Energy Directive should support ideas suggested in REPowerEU, such as ‘go-to’ zones for renewable projects where permitting shall not exceed one year and designating renewable projects as “overriding public interest” to allow simpler administrative procedures. Any ﬁnal agreement should, however, adequately address environmental impact and social and biodiversity concern. It is also equally important to enforce the legislation that is already in place, namely the two-year limit that was set in the Renewable Energy Directive already in 2018.
Multiple gigawatts of European renewable capacity are being delayed due to administrative barriers. In Poland, up to 20 GW of solar capacity is waiting for grid connection permits. With quicker permitting times and the necessary grid upgrades, these projects can be unlocked, helping in the reduction of Russian gas consumption, lowering electricity prices and improving Europe’s energy security.
Shift towards deployment
At an EU level, expected wind and solar deployment rates are below those required for 1.5C, reaching only 50 percent of necessary additions in 2026. Out of the EU member states, only a handful are reaching required wind deployment rates, and key countries for solar deployment are also lagging behind. A crucial barrier to wind and solar deployment is the permitting process time, which in most countries exceeds the EU legislative limit of two years.
To begin tackling barriers to deployment, the existing two-year permitting limit, stated in the Renewable Energy Directive (RED), needs to be enforced by the European Commission. To align with REPowerEU and 1.5C, it is equally important that the amendment to the RED is passed this autumn, raising the EU’s 2030 renewable energy target to 45%.
Further, the 1.5C-aligned capacity expansion pathways should also be transposed into the updated National Energy and Climate Plans (NECPs) during the formal review process in 2023. At a national level, auction volumes should be signiﬁcantly increased to capacities in-line with 2030 targets. Renewable energy ‘go-to’ areas, taking into account environmental and social concerns, should be designated as suggested in REPowerEU where permit-granting should not exceed one year. Finally, permitting processes should be streamlined through investments in personnel and digitalisation to ensure they are compliant with the two year limit.
Slow wind and solar deployment will only exacerbate the current cost and security crisis the EU’s energy sector is facing. Rapid expansion of these technologies will help the EU to replace expensive and uncertain fossil fuel imports with clean and secure sources of energy, whilst also reducing electricity prices.
The complete report can be read here