18.8.2006   

EN

Official Journal of the European Union

C 195/69

1.1

The EESC welcomes the Commission's Biomass Action Plan, which, in its view, makes a key contribution towards achieving sustainable development in Europe.

1.2

The analysis of the current expansion of the use of biomass and the potential of this material provides an initial overview of the scope for using biomass and the existing obstacles to its use in the various energy sectors.

1.3

Bringing about an increase in the share of overall renewable energy represented by biomass is a key prerequisite for enabling the EU to achieve its goal of having renewable energy comprise 12 % of overall energy consumption by 2010. The proposal to step up the promotion of the use of biomass is therefore the right course of action and an essential step.

1.4

The proposal to close the gap in legislation with regard to the use of renewable energy for heating purposes is expressly supported by the EESC. The only instruments available up to now at EU level have been the Directive on promoting electricity produced from renewable sources and the Directive on promoting biofuels. In view of the fact that heating accounts for some 50 % of overall energy consumption, and in the light of the considerable potential of biomass as a means of producing heating, the Commission is expected to present a proposal on this subject before the end of 2006.

1.5

The scope of this proposal should, however, not be confined to biomass; it should also take account of other renewable energy technologies used in heating and cooling systems. Setting a concrete, binding target for the EU to achieve by 2020 would provide investors with security. The EU should set a binding target of having at least 25 % of final energy consumption met by energy produced from renewable sources by 2020.

1.6

The EESC has some criticisms to make in respect of the Commission's planned report on the use of biofuels and calls for stronger measures to be adopted in this field. The use of biofuels can, in principle, make a substantial contribution towards reducing Europe's dependence on fossil-based energy sources. In this context, in particular, it is also becoming clear that, even if an ambitious substitution policy is pursued, the development of more effective transport systems and a substantial improvement in energy efficiency will continue to be of decisive importance.

1.7

The EESC therefore urges the Commission to create, before the end of 2006, long-term prospects for investors and to propose new, binding targets with regard to the market share to be obtained by biofuels by 2020.

1.8

The funding provided up to now in the Seventh Framework Programme should be substantially increased. The use of lignocellulose-based biomass and by-products, in particular, should also be stepped up.

1.9

The existing Directive on the promotion of particularly efficient cogeneration (1) should be broadened in order to give priority to the use of biomass in cogeneration, provided that the underlying conditions render this possible.

1.10

A horizontal approach should be adopted in respect of the policy for increasing the use of biomass in the EU. Coordinating agricultural policy, structural policy, regional policy and energy policy with a view to enabling farmers to gain greater access to the energy production market, too, may point the way forward for competitiveness, environmental protection and energy supply in Europe.

1.11

The EESC welcomes the fact that the Commission has flagged up the need for transparent, reliable trade agreements. Instruments providing for qualified market access, also in the case of biomass products, should, however, be set up under the WTO treaties. This is the only way to enable the embryonic European production industry to have the opportunity to develop.

1.12

The use of biomass in the production of materials should also be discussed in a European action plan.

1.13

The Commission and the Member States are called upon to amend the Sixth Directive (2) on the harmonisation of the laws of the Member States relating to turnover taxes with a view to authorising Member States to apply a reduced rate of value-added tax on materials and services in connection with the use of heating and cooling systems powered by renewable energy.

1.14

The EESC calls upon the EU Member States and the Commission to ensure that a minimum share of the resources of the EU Structural Funds is set aside for investment in the use of biomass and other renewable sources of energy. The EESC also advocates earmarking minimum shares in the European Agricultural Fund for Rural Development (EAFRD) for such investment. The share of funding set aside for investment in this field should increase and amount to 10 % of Structural Funds resources — as an average figure for the Member States — by the end of the planning period in 2013.

1.15

The EESC also believes that the decoupling of direct payments, as part of the latest reform of the CAP, provides a key prerequisite for stepping up energy plant cultivation. In the EESC's view, there is scope for action to be taken in the short-term within the framework of the CAP with a view to adjusting the energy plant premium. The use of this instrument should then also be made possible in the new Member States, in particular.

1.16

In addition to an ongoing monitoring of the extent to which targets have been achieved, there is, in the EESC's view, also a need to make it mandatory for the Member States to draw up biomass action plans. This would make it possible to identify and mobilise the potential of the various regions.

1.17

The EESC proposes that administrative barriers be removed and that account be taken of renewable sources of energy, for example in regional planning measures.

1.18

The EESC expects that the requirements in respect of safe certification of the origin of products would already be defined in a Biomass Action Plan. It draws attention to the following requirements: sustainability criteria in respect of products of EU origin; food sovereignty; and social and environmental standards to be met in order to gain qualified market access.

1.19

The EESC welcomes the fact that, according to the Commission, the same emission standards will apply to bioenergy as apply to fossil fuels.

1.20

The EESC foresees the development of a single European energy policy. Whilst there may be a degree of useful competition between marketing systems for renewable sources of energy, those systems which have shown themselves to be particularly cost-efficient and efficient as regards the extent to which they have stimulated the development of new processes should also be applied throughout Europe. A case in point is the use of dynamic fixed price models which have already been introduced under the renewable energy acts adopted by many EU Member States.

1.21

In the EESC's view, marketing measures cannot be geared to long-term subsidisation but should rather seek to be competitive and economically viable when external costs are also taken into account.

2.1

The development of renewable sources of energy continues to top the energy policy agendas of both the EU and its Member States because of the following considerations: security of supply; the EU's increasing dependency on imports of oil and natural gas; rising oil prices; and the obligations to cut greenhouse gas emissions.

2.2

The goals set out in the Directive on the promotion of electricity produced from renewable energy sources and those set out in the Directive on the use of biofuels, will not be achieved unless more far-reaching measures are taken. The EU will also fail to realise its overall goal of doubling the market share of renewable energy to 12 % if it persists with a ‘business as usual’ scenario. A major reason for this is that a large part of the energy required to meet this target would have to be produced from biomass and the development of this market is lagging behind expectations.

2.3

The market share of all forms of renewable energy remains at a persistently low level; the share of renewable energy in the overall energy mix of the EU is likely to be only 9 % to 10 % by 2010, rather than the target figure of 12 %, unless appropriate measures are taken. The Commission has therefore submitted a biomass action plan which at least announces a number of further initiatives in this key area which has up to now been strategically neglected.

2.4

Investments in energy utilisation are always long-term investments. A newly-completed power station will have an operational life of in excess of 30 years. Uncertainty over trends in oil and gas prices, in contrast to the high level of predictability of raw material costs in the biomass sector, represent, together with the effects of aspects such as climate change, a key economic reason for promoting this technology. Furthermore, the aim is not to engage in long-term subsidisation of systems but rather to develop systems which are competitive when also taking account of external costs.

2.5

In contrast to the expected price increases for conventional fuels, renewable energy technologies are providing ever better value for money as result of falling investment costs brought about by technical progress and mass production.

2.6

Cost comparisons between renewable energy and conventional or nuclear energy are usually inadequate. In many cases comparisons are made between costs in respect of power stations built by former state-monopoly generating companies, the value of which has already been written off, and costs in respect of newly-installed capacity using renewable technologies. Furthermore, the external costs of conventional or nuclear technologies, such as damage to the environment or insurance benefits provided by the State in respect of power stations, are also not reflected in energy prices.

2.7

In its action plan, the Commission sets out more than 20 measures, most of which are to be implemented from 2006. With regard to the use of biofuels in transport, a number of preliminary measures have to be taken prior to the introduction of obligations under which oil companies would have to add a given percentage of biofuels to their conventional fuels.

2.8

In its action plan, the Commission announces that it will present a report in 2006 on a possible revision of the biofuels Directive; in this report the Commission will examine the implementation of this Directive in this EU Member States. The current market share of biofuels in the EU is 0.8 %; it is therefore highly unlikely that the target of a market share of 5.75 % for the EU as a whole, laid down in 2003, can be attained by 2010.

2.9

Under the action plan the scope for improving fuel standards is to be examined with a view to promoting the use of energy from biomass in transport, electricity generation and heating. Investment in research, particularly into the production of liquid fuels from wood and waste materials, is also to be promoted, as is a campaign to inform farmers and owners of forests about energy crops. The Commission also intends to draw up legislation to promote the use of renewable energy for heating purposes.

2.10

According to estimates made by the Commission, if the measures foreseen in the action plan are implemented, biomass use could be increased to about 150 Mtoe by 2010 (as opposed to 69 Mtoe in 2003) without intensifying agricultural production and without significantly affecting domestic food production. According to the forecast made by the Commission, this could, in turn, bring about a reduction in greenhouse gas emissions of 206 million tonnes CO2 per year. Between 250 000 and 300 000 jobs would also be created — mostly in rural areas — and the EU's dependence on imported energy would be reduced from 48 % to 42 %.

2.11

Assuming the price of a barrel of crude oil to be $54, the Commission estimates that the directly measurable cost of the projected increase in biomass use would be EUR 9 billion per year — EUR 6 billion for biofuels and EUR 3 billion for biomass used in electricity generation. This is equivalent to an increase of about 1.5 cents per litre of petrol and 0.1 of a cent per kWh of electricity.

3.1

The EU will not achieve the goals which it has set with regard to expanding the use of renewable energy unless further measures are taken. The EESC welcomes the Biomass Action Plan and notes that, in setting a number of additional intermediate objectives, such as a 15 % overall share for renewable energy and an 8 % overall share for biogen fuels by 2015, the Spring Summit of Heads of State and Government signalled that an ambitious policy for the use of renewable sources of energy is to continue to be pursued. The decision taken by the European Parliament to set a target of a 25 % overall share for renewable energy sources by 2020 demonstrates that there is a growing determination to bring about a redirection of energy policy in the EU.

3.2

A further barrier is the fact that — as is the case with many other innovative technologies — the technologies employed in the case of renewable energy sources often still have to contend with a lack of confidence on the part of investors, governments and consumers; this can be put down to ignorance of the technical and economic possibilities offered by these sources of energy. In the EESC's view, there is a considerable need for information and further training not just in respect of users and consumers but also in the R & D sector; the Biomass Action Plan should address this need more intensively.

3.2.1

The EESC also notes that there is frequently a concentration of enterprises in the energy sector and points out that this does not always chime with the need for a rapid introduction of innovatory techniques and procedures. The EESC draws attention to the fact that, against the background of the current business structure, new impulses, which often arise in small and medium-sized enterprises, are not adequately exploited. It calls upon the Commission to put forward proposals for improving this situation.

3.3

Increased use of biomass could not only bring about a substantial reduction in the EU's dependence on energy imports but also make a considerable contribution towards the realisation of the Lisbon strategy and the climate protection objectives. The use of biomass also tends to promote decentralised structures and thus also to encourage rural development. Particularly in the case of the new EU Member States, where a considerable proportion of the workforce is employed in agriculture, the use of biomass provides major scope for diversifying sources of income and safeguarding jobs.

3.4

The EESC draws attention to the fact that Europe is currently the leading player in a number of areas of bioenergy technologies. The EU economy is dependent upon the development and export of new technologies. Innovatory procedures and products based on regrowing raw materials provide the basis for enabling the EU to lead the world in the technologies of the future. It is therefore of key importance to the economic development of regrowing raw materials in the EU that the requisite basic political conditions are in place. The establishment of these structures should also go hand–in–hand with measures to support the export of bioenergy technologies to countries outside the EU.

3.5

The EESC recognises the considerable labour-market potential generated by the implementation of the Biomass Action Plan alone. The MITRE (Monitoring and Modelling Initiative on the Targets for Renewable Energy) Synthesis Report of 2003 established that, if the EU were to adopt an ambitious raw-material strategy based on renewable sources of energy, almost 2.5 million net additional jobs would be created by 2020 in EU-15 alone. It was forecast that some two-thirds of these jobs would be created in the biomass sector. This will give rise, on the one hand, to an additional need for highly skilled employees, particularly in the fields of R and D. The number of employees required is estimated at 400 000. At the same time there will, on the other hand, also be a need for employees having low or modest basic skills. The EESC calls upon the Commission to investigate the prospects for the EU labour market in the period up to 2020 which would be opened up by an ambitious expansion of the use of biomass and renewable energy sources.

3.6

In the EESC's view, it is essential to set out binding long-term political targets in order to trigger investment and restructuring. The Biomass Action Plan fails to set such targets. The Commission is therefore urged to define, as soon as possible, concrete objectives concerning the use of biomass or other renewable energy sources. Binding European targets, covering the period up to, at least, 2020, should be defined in respect of electricity generation, heating and transport; these targets should be realistic but ambitious. A binding target should be set of having at least 25 % of final energy consumption met by energy produced from the abovementioned sources by 2020. The existing biomass potential in Europe, particularly as regards by-products, together with the potential amount of land available, once it is put to different use to meet changed demand structures, may make it possible to pursue this course of development. The EESC would point out that the USA is implementing, by means of an energy conservation act, its own similarly high targets for the long-term use of biomass.

3.7

The EESC supports the cautious assessment of the raw-material basis (amount of biomass required) for implementing the Biomass Action Plan; it is expected that, during the planning period, these requirements will still not give rise to competition with agricultural raw material production. In the long term, it may be assumed that productivity will increase and that there will be a drop in the level of food consumed in Europe. At present a large proportion of arable land in the EU is required for keeping livestock. There is, however, on the other hand, a world-wide shortage of arable land. Considerable demands will therefore have to be placed on the development of efficient processing and conversion technologies. In this context, the EESC is critical of the ‘balanced approach’ advocated by the Commission with regard to the securing of supplies at international level, particularly supplies of the basic raw materials for biofuels. In this field cheap imports into the EU may endanger the production of basic food supplies in other parts of the world, whilst also holding back technological developments in Europe.

3.8

In spite of the different forms of energy requirements and differences as regards the biomass supply basis in Europe, the EESC expects a Biomass Action Plan to put forward views on how marketing systems can be developed. In this context and with a view to promoting electricity generation from renewable sources of energy, including biomass, the measures which have been shown to be the most efficient in terms of both cost and development are models for feeding electricity into the grid and premium models, such as those developed in Germany. In its communication on electricity from renewable energy sources (3), the Commission has already drawn attention to this point. The basic financial conditions are not, however, the only decisive factors with a view to expanding the use of renewable sources of energy. At least four parameters have to be met in order to ensure successful expansion in this field.

3.9

These conditions are as follows: an efficient financial incentive model; guaranteed, fair conditions in respect of access to the grid; transparent administrative procedures; and public acceptance. Only if these four conditions are fulfilled at the same time will it be possible to achieve a significant rate of growth as regards the generation of electricity from renewable energy sources. Electricity generation accounts for some 20 % of the EU's energy requirements.

3.10

The EESC endorses the conclusion, set out in the abovementioned Commission Communication, to the effect that it is too early at present to bring about complete harmonisation of aid models for promoting electricity from renewable energy sources. The EESC does, however, call upon both the Commission and the Members States to make preparations for the introduction throughout Europe of the most effective components of such models.

3.11

The Commission is called upon — in line with Directive 2001/77 (4) — to monitor the above-mentioned conditions in the Member States and, if necessary, to insist on their introduction.

3.12

The EESC endorses the Commission's appraisal of the role to be played by biomass in implementing Directive 2001/77. In the Action Plan the expansion of cogeneration, particularly when also utilising biomass, is described as a key prospect for future development. The EESC calls for the Directive to be brought into line with the cogeneration Directive. It should be stressed that, over the next two decades, the impending high level of investment in replacing power stations will provide an opportunity for expanding cogeneration in Europe. This will, as is widely acknowledged, promote more decentralised electricity generation, in close proximity to the consumer. The EESC does, however, draw attention to the fact that the Biomass Action Plan fails to put forward any views on how to ensure that electricity producers, including those producing energy from biomass, can be given access, on a non-discriminatory basis, to electricity grids.

3.13

50 % of Europe's energy requirements is used for the production of heating. Despite the considerable potential of biomass with regard to the production of heating, heating produced from this source probably accounts for less than 10 % of the market at the present time. The EESC therefore expressly welcomes the proposals set out in the Action Plan. In view of the fact that investment in heating systems and building systems is very long-term investment and, to a certain extent, also capital-intensive, the EESC calls for a prompt start to be made on implementing the proposed measures. The proposal for a legislative initiative in respect of heating and cooling systems should be extended to take the form of a Directive on the promotion of heating and cooling produced from all renewable sources of energy, i.e. including solar energy and geothermal energy. In addition to the measures proposed by the Commission, a future Directive should lay down binding national objectives which should take account of differences as regards natural resources and existing capacities.

3.14

The EESC deplores the fact that hardly any reliable statistics are available relating to heating; if there were to be a uniform system throughout Europe for monitoring the use of heating, this would enable the EU as a whole to plan the use of resources more effectively. As regards the conversion of district heating networks to use biomass as fuel, the EESC underscores the Commission's appraisal in respect of the importance, the development and the safeguarding of these networks. In the new Member States, in particular, there is a considerable number of such networks which need to be safeguarded.

The existing Directive on the energy performance of buildings should be implemented as soon as possible in all Member States and endeavours should be made to amend the Directive. The field of application of the Directive should be extended to include all buildings, including those having a surface area of less the 1 000 m2. Priority should be given to the use of decentralised energy systems based on biomass. The EESC endorses the observations made in the Action Plan on the building of new district heating systems — and the safeguarding of existing systems — using biomass to produce heat and, in particular, heat and power.

3.15

The EESC welcomes the points made by the Commission in the Biomass Action Plan with regard to the existing and future emission standards (and the Directive on particulate matter) in connection with the use of biomass. The same standards apply in the case of the production of heating and electricity generation and also the use of fuels.

4.1

Although fuels account for only 20 % of Europe's energy needs, they derive, almost exclusively, from imports of fossil-based raw materials. This fact justifies the considerable amount of space devoted to fuels in the Biomass Action Plan. In the EESC's view, the Commission's activities in this field, as described in the Biomass Action Plan, bear the hallmark, to an excessive degree, of pressure to come up with successful proposals without delay. Too much emphasis is placed on imports of marketable fuels and too little importance is attached to the new dependence on imported products and to effects on the environmental and social balance in the new energy-producing states. The EESC requests the Commission to examine whether this strategy, as set out in the Action Plan, might not actually have the effect of delaying the development of sustainable European solutions.

4.2

In the biofuel sector, tax reductions or tax exemptions have been shown to represent the most effective aid measures. This instrument has facilitated, in particular, investments tailored to regional requirements. The Member States should continue to have this option available to them. The Action Plan fails to make this point clear.

4.2.1

High priority should be attached in the R & D sector — and therefore also in the future implementation of an EU biofuel strategy — to the use of substitute natural gas (SNG), in addition to biomass-to-liquid (BTL) fuels. In comparison with biodiesel produced from oil-bearing plants, biogas has a five times higher energy yield per ha. SNG has a high level of output per area unit and is at an advanced stage of development; the use of this fuel does, in principal, also make it possible to produce fuel, power and heating at the same time in decentralised SNG plans.

4.3

The EESC supports the Commission in its endeavour to formulate a binding target of a 5.75 % market share for biofuels by 2010. It welcomes the fact that the 2006 Spring Summit of Heads of State and Government set an intermediate objective of 8 %, to be achieved by 2015. The EESC does, however, note the lack of a strong commitment on the part of the economic enterprises concerned, the Commission and the Member States to make the urgently necessary quantum leap as regards the achievement of more efficient transport systems. At this juncture the EESC welcomes the proposals set out in the Action Plan for removing the various forms of discrimination against biofuels and the proposals in respect of standardisation.

4.4

The use of biomass should be substantially strengthened under the Seventh Framework Programme for Research. One of the objectives in this context must be to make renewable energy sources competitive. The EESC draws attention to the fact that a paradigm shift in research policy towards research into renewable resources is of decisive importance to economic development in Europe. The EESC expects to see more binding statements issued in this context, also in the Biomass Action Plan. The EESC underlines the fact that the main areas in which development is lagging behind are not the supply of biomass but rather in the availability of technologies for producing marketable products.

4.4.1

With a view to developing the use of biomass, including its use for the production of materials, it is also often advisable to adopt an approach based on fractions of biomass and utilisation cascades. In principle, however, the decisive factors are market prices and production costs and future estimates in respect of these factors. By way of example, bearing in mind that there is no market for processed wood products, it is generally more advisable and more effective to make use of wood for the direct production of heating or energy, rather than processing it into fuel by means of a long BTL process involving energy losses. In the EESC's view, the Action Plan should adopt a more differentiated approach in this context and thus attach greater importance also to the use of biomass for the production of heating.

4.5

The EESC expects that the Council and the Commission will give high priority, also in the context of the allocation and distribution of resources from the Structural Funds in the Member States, to expanding investment in renewable energy sources and, in particular, biomass. A mandatory minimum share of Structural Funds resources allocated to the EU Member States should be earmarked for this type of investment. By the end of the current planning period in 2013, the share of Structural Funds resources set aside for investment in this field should amount to 10 %, as an average figure for the EU Member States.

4.5.1

In the context of the allocation of funding under the second pillar (rural development) of the European Agricultural Fund for Rural Development (EAFRD), renewable energy is mentioned in the strategic planning section, which deserves overall endorsement. Particularly in view of the very limited financial resources and in the light of the potential of rural areas, steps should be taken to ensure that, in the case of this funding, too, by the end of the planning period in 2013, a minimum average share, for the EU Member States as a whole, of 10 % is set aside for investment in renewable energy.

4.6

The EESC draws attention to the statements made in the Biomass Action Plan with regard to the impact of decoupling on the cultivation of regrowing raw materials. The EESC would, however, highlight the following opportunity to make adjustment in the short-term: the energy plant premium (EUR 45/ha) in respect of 1.5 m ha, adopted as part of the Luxembourg decision on EU agricultural reform (2003), is coming up for review at the end of 2006. The EESC calls upon the Commission to consider whether the current value of the premium is sufficient. The EESC considers that the current application procedure is too bureaucratic and it proposes that administrative adjustment be made as a matter of urgency. As things stand at present, no application for energy plant premiums may be made in the new accession states which have opted for a simplified CAP procedure (eight out of the ten new Member States). As part of the adjustments to be made from the end of 2006, the EESC calls for these Member States, too, to be given the possibility of having access to this area payment. As regards the amount of the premium, a separate adjustment should be made for those locations which, as results of the transformation process, are not entitled to receive payments (5).

4.7

The EESC proposes that the EU Biomass Action Plan makes provision for mandatory national and regional action plans in the Member States. In view of the diversity of the EU Member States and regions, this would be a step towards identifying the potential and shaping a policy and administrative bodies accordingly.

4.7.1

The EESC draws attention to the fact that the Action Plan fails to address the scope, shortcomings and impediments with regard to the extended use biomass and of renewable energy in the Member States and regions. A number of possible remedies may be proposed, namely: making it mandatory to take account of this issue in regional planning measures and incorporate it in these measures; pinpointing and removing discrimination in administrative bodies; concentrating the work in the planning and construction phases on one administrative department.

4.8

The EESC calls upon the Commission and the Member States to amend the Sixth Directive (77/388/EEC) on the harmonisation of the laws of the Member States relating to turnover taxes with a view to authorising Member States to apply a reduced rate of VAT on materials and services in connection with the use of heating and cooling generated from renewable sources of energy. By way of example, some Member States currently exempt gas and oil burners from taxes, whilst levying the full rate of taxation on investment in heating produced from renewable sources of energy.

4.9

There is, in the EESC's view, an urgent need to introduce a European energy policy. When selecting the instruments governing the introduction of renewable energy onto the market, there is a need to find a balanced approach based not only on competition between national systems but also involving dynamic progression towards introducing clearly the most efficient rules.

4.10

The EESC also believes that there is a need to take action without delay to introduce a certification system with regard to the origin of biomass raw materials. This is the only way to avoid negative balance sheets in respect of the environment and climate. The following requirements should be laid down (6):

4.11

The following requirements should also be included in the certification process in respect of the international trade in biomass and biomass products: food sovereignty (which implies that ensuring security of food supply takes precedence over the cultivation of cash crops); social and environmental standards in respect of production; no clearing of primeval forests. The EESC calls upon the EU to ensure that these criteria are also incorporated into WTO rules.

4.12

The EESC calls upon the Commission to give its support, in the Biomass Action Plan, to the creation of an International Renewable Energy Agency (IRENA) and also to pay greater heed in the Action Plan to the issue of transparency in the international raw materials trade and industry.