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The following article was published in our article directory on October 12, 2010.
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European Union A Variety of Policy Support the New Energy Industry

Article Category: Business

Author Name: xia zihui

The scarcity of traditional energy sources for the EU is not only the development of renewable energy to meet future energy needs a "key", but also to achieve greenhouse gas emission reduction targets and to seize the "green economy" commanding heights of a "weapon." In order to promote the development of new energy industries, the EU introduced a variety of subsidy policies to support, but these subsidies are built "green barriers" should cause alarm.

Legislative measures to promote the development of new energy industry

As early as 2001, the EU passed legislation to promote renewable energy. In March 2007 EU summit, EU leaders adopted a landmark package of energy and climate change agreements, including the expansion of renewable energy use to set specific targets to achieve by 2020 renewable energy accounted for EU energy consumption to 20%.

Under the agreement, the European Union in April 2009 passed a new renewable energy legislation, the expansion of renewable energy use overall objective assigned to head the Member States, and requires Member States to June 30 this year, before the development of national Plan to be implemented.

This series of moves, especially in setting specific objectives for the EU's new energy industry, pointing out the development and market prospects, investors eat a "reassurance." In view of early development of new energy and a higher initial cost, hard to compete with traditional energy sources on the same stage, the EU means to support the widespread use of subsidies.

Under the new legislation, the EU put on the new energy industry subsidies discretion left to member states. This means that the EU and for the development of new energy industry means there is no uniform allowance, the Member States according to their own characteristics, choose to support certain types of new energy development, the form of subsidies is also varied.

Price support and volume requirements of both dual

Overall, the European Union in order to encourage use of renewable energy power generation, subsidies can be divided into two categories. Among them, one is price support, the most typical example is the first implementation of the Internet in Germany fixed price system.

German laws enacted in 1990, for the first time provides for free access to renewable energy grid, and the government will provide subsidies. The beginning of the amount of subsidies is based on the percentage of end-user determine the purchase price, for example, the maximum available solar and wind power 90% of retail price subsidies, biofuels and hydroelectric power available to 65% to 80% of the subsidies. In 2000, Germany amended the legislation to access a fixed price, that electricity suppliers must be designated by the Government in price from the manufacturer, renewable energy purchase. The fixed price based on renewable energy vary by the type, the two sides signed more than 10 years the general long-term contracts, thus ensuring the benefits of renewable energy companies.

This support policy has greatly promoted the development of new energy industry in Germany. Currently, from the capacity point of view, Germany is the world's largest solar market, wind power last year after the United States. So far, more than 40 countries to emulate Germany, the implementation of online fixed price system, including France, Spain, Italy and the Czech Republic and other EU member states. This system has become the new EU countries to support their most important means of energy industries. The European Commission believes that the fixed price system of the Internet for promotion of renewable energy power generation is the "most effective" and "most economic" forms of support.

The other is the number of requirements, which require electricity suppliers must ensure that a certain percentage of their electricity from renewable energy sources. More representative in this respect is the British "Green Certificate" system. For the use of renewable energy power generation enterprises, which will be based on how much electricity can be traded to obtain green certificates, this is a bit like a carbon emissions trading rights, but not to the number of requirements for power generation will need to purchase green certificates from the market.

Tax breaks and preferential loans and other means to promote the development of new energy

In addition to price support and the two main ways the number of requirements, the EU also adopted preferential tax breaks and loans, or even direct cash grants and other financial instruments to promote the development of new energy industries. For example, in some EU countries, the use of renewable energy power generation companies can be exempt from carbon tax. British government in February this year, the introduction of "clean energy cash back program" provides that any installation of solar panels and micro wind turbines and small family businesses will be able to receive subsidies, age 10 to 25 years.

The policies of different countries, different means, it is difficult to Statistics New EU energy industry to promote the development of the total subsidies provided. With the new development and expansion of the energy industry within the EU also issued a unified voice of subsidy policy. Senior Advisor to the European Federation of Industry Fuer Ke Franz pointed out that the different countries of the EU subsidies hinder fair competition in energy markets is not conducive to optimal allocation of resources in the long term, the EU should be unified subsidies for new energy industry .

Although the EU has no unified means of subsidies, but in recent years, indirect support through increased investment in research and development of new energy industries. Last October, the European Commission proposed to increase the EU in the next 10 years, 50 billion euros earmarked for low-carbon technology development. The European Commission have jointly developed the business community and researchers develop low-carbon technologies of the EU "roadmap" to wind, solar, bio-energy, carbon capture and storage, power grids and nuclear fission was established as the six most critical areas of development potential .

Industry subsidies controversy

Benefit from policy support to the European Union and member states, many European companies in wind energy, biomass and other new energy holds the forefront of technology, the industry leader. However, the EU and its members some of the subsidies has also been called into question the practice, is considered to impede competition in the market, a violation of WTO rules is suspect.

Europe International Political Economy Research Center, Frederick, Eriksson told the EU's bio-fuel subsidies, a systematic study. In his view, the EU's biofuel production to accept the high subsidies, the annual subsidy of up to 40 billion euros. By setting high tariffs to raise the technical threshold, the production of biofuels imposition of strict environmental standards, his country and the production of raw materials kept out of biofuels, the EU is essentially in the implementation of "green protectionism."

In biofuels, the EU has also created trade frictions with the United States and last July the decision of the U.S. biodiesel exports to the EU imposed a five-year anti-dumping and countervailing duties. Around the new energy industry, the competition between the major economies are becoming fierce.

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