2nd May 2017

Cambridge Institute for Sustainability Leadership: 21st century energy: Business reflections on renewables in Europe

Executive summary

We invited 15 companies and business organisations to share their experiences with renewable energy and the innovation within their organisations, and interviewed them on the European context in which they operate. These companies together represent a cross-sectoral group of industries. Discussions explored the decisions taken on renewables and what the business drivers had been that prompted those decisions. Interviewees were asked if and how the existing Renewables Directive had affected corporate policy, whether the measures it contained were effective in achieving its goals, and how future Directives could best facilitate further action.

A common message from these discussions was a desire for a more ambitious, consistent, and co-operative approach to renewables policy, and a wish to see Europe lead on innovation in this area. Companies reported frustration with policies that they perceived as inconsistent, unenforced, and unambitious. They identified low levels of national and regional co-operation, and an absence of a coherent framework within which to plan future operations.

Other key insights included:

•  Most companies interviewed welcomed bold targets.

These are seen as a good way of delivering results in the private sector, while unambitious targets were felt less likely to drive business investments. Proponents of stronger targets argued that they must  be high enough to prompt action and intervention,  not merely predict where business as usual will end up.

•  Some interviewees argued that success depends on giving everyone a clear mandate. 

These interviewees believe Member State commitments should continue to be part of the solution, because the absence of binding targets on renewable energy devalues policy ambitions and creates an environment where investments are perceived as risky.

•  In a number of interviews, there was a clear recognition that greater consistency is needed in renewables policy between, and within, countries in Europe.

Europe’s Energy Union needs a common framework for cross-border co-operation that includes standard market design, templates for regional co-operation, and measures for enforcement.

Many of the companies interviewed felt they could easily absorb the current level of ambition for transitioning to renewable energy, and see the potential for doing much more if the EU would step in to rationalise the current landscape of conflicting policy and regulation. A clearer and more ambitious policy landscape will provide much-needed confidence that can enable business investment and take EU renewable energy supply to significantly greater levels.

In contrast to other companies interviewed, EDF Energy would like to see a progressively reduced emphasis on technology-specific targets (such as renewables) and a greater commitment to using a strong carbon price  to drive the development of the lowest cost, low carbon energy solutions.

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Members of the American Chamber of Commerce in the Czech Republic