The main reference document in which European policies for the renewable energy sector are defined is the White Paper on renewable energy, which was adopted in November 1997. This not only established the ambitious target of 12% for the contribution of renewable sources of energy to the European Union’s gross inland energy consumption in the year 2010, but also required the Commission to report every two years on the progress achieved towards this objective. The main features of the Action Plan contained in the White Paper include: 

  • internal market measures in the regulatory and fiscal spheres 
  • reinforcement of those Community policies which have a bearing on increased penetration by renewable energies 
  • proposals for strengthening co-operation between Member States 
  • support measures to facilitate investment and enhance dissemination and information in the renewables field

The so-called “Green Electricity Directive”13 sets a legal framework for the future development of the renewable electricity (“RES-E”) markets in the EU. Member States are now obliged to establish national targets for the future consumption of RES-E, and the Green Electricity Directive gives indications for these targets in an annex. If the targets are met, then the consumption of electricity from RES-E in the EU will rise from 14% in 1997 to 22% by 2010. The Commission monitors the progress made towards these targets. Member States had until 27 October 2003 to transpose this directive into national law.

The Commission has also adopted guidelines on State Aid for environmental protection14 providing transparent criteria for those circumstances under which it holds “green” State Aid to be compatible with the competition regime of the common market.

The so-called Biofuel Directive15 aims at promoting the use of bio fuels or other renewable fuels to replace diesel or petrol for transport purposes in each Member State, with a view to contributing to objectives such as meeting climate change commitments, environmentally friendly security of supply and promoting renewable energy sources. Member States had to transpose this directive into national law by 31 December 2004 at the latest. Apart from legislative initiatives, the European Union also supports renewable energy through its Research Framework Programme. The severnth Framework Research Programme, which will apply from 2007 -2013, proposes to fund a wide portfolio of research into environmental technologies such as solar and wind energy, clean coal and carbon capture and sequestration, economically viable biofuels for transports, and new energy vectors such as hydrogen and environmentally friendly energy usage (eg, fuel cells).