New EU rules phase out subsidies for renewables

The EU Commission on Wednesday (April, 9) published new rules on public support for environmental protection and energy that will replace the existing guidelines on aid for Environmental protection entered into force in 2008. The new rules replace subsidies for renewable energy  sources with market-based schemes, providing for the gradual replacement of feed-in tariffs by feed-in premiums.
The Regulation will be adopted in May 2014 and enter into force on 1 July 2014. A pilot phase in 2015 and 2016 will request Member States to start implementing competitive bidding procedures for a small share of their new capacity from renewables, and from 2017 on they will had to  set up tenders to grant support to all new installations, official notice says. The guidelines will be in force until the end of 2020, but they will have no effect on aid paid to the owners of existing installations.
The aim is to address “the market distortions that may result from subsidies granted to renewable energy sources”. The Commission explains that “the remarkable growth of renewable energy over recent years, partly induced by public support, has helped to make progress on environmental objectives but has also caused serious market distortions and increasing costs to consumers”.
The decision received strong criticism from several fronts, Reuters reported. Many pointed out Germany reached a compromise deal that allow Berlin to set special rules for individual sectors. Environmental groups denounced new rules allowing for exemptions also in energy-intensive energy sectors will lead to to more use of coal and efforts to develop shale gas, not more green power. The European Wind Energy Association said it is appropriate that the increasingly competitive wind industry be integrated into the market, but that the Commission should eliminate all fossil fuel subsidies as a priority.