In the last three years, Horizon 2020 will allocate €2 billion to decarbonizing buildings, renewables, storage solutions and electromobility.

European governments spent €42 billion on direct fossil-fuel subsidies. But they invested only €4.2 billion into clean-energy research and innovation.

The figures for 2012 and 2014, respectively, were highlighted by the new Communication of the European Commission, Accelerating Clean Energy Innovation, published in late November. Commissioner for Research, Science and Innovation Carlos Moedas presented it at the SET Plan – Central European Energy Conference X in Bratislava, where it was submitted to a first review.

Correcting market failures

“The transition to clean energy is happening. But not as fast as we need it to happen,” said Commissioner Moedas. “Climate change and loss of competitiveness mean we need a renewed sense of urgency,” he told experts at the Bratislava conference.

The thinking behind the new research and innovation (R&I) is that “innovation-led growth is not just about fixing a market failure, but also about setting direction and creating new markets.”
In order to correct the market failure, the Commission wants, first, “regulations as policy signals”. They should channel the private investment as well as public subsidies in new technologies. They should also bring about “prosumers: consumers who use, but also produce their energy.”

Mobilizing private investment

Second, the correcting market failure means mobilizing private investment.

“The EU can deploy targeted financial instruments to lower the risk of private investments in untested but promising clean energy technologies or business models,” Moedas explained.

He announced the Commission would at least double the budget of the InnovFin Energy Demonstration Projects scheme. The scheme, part of the Horizon 2020, “is generating strong interest for loans or loan guarantees to first-of-a-kind low-carbon technologies in renewables and fuel cells and hydrogen,” the Communication reads.

Setting direction

As for setting direction, Moedas plans to redirect funds within Commission’s main fund for research.

“In the last three years, of Horizon 2020, we will put more than €2 billion in four specific areas … that build on the priorities of the SET Plan,” the Commissioner informed. They are decarbonizing buildings, renewables, storage solutions and electromobility.

Moedas believes Europe can be “a leader in low-carbon technologies”, but it needs “a new era of disruptive innovation.”

Learning by doing

Charlina Vitcheva, Deputy Director General of the Joint Research Centre (JRC), elaborated on Moedas’ strategy listing technologies, which should be funded: offshore wind, photovoltaic, deep geothermal energy, ocean energy and concentrated solar energy.

Member of the HORIZON 2020 Advisory Group on Energy, Marianne Haug, was more critical. She complained that the Commission has reconciled with the fact that 80 percent of investments in the renewables happen outside Europe.

“But learning by doing is an innovation policy. It’s not enough to look at is as export policy,” she told experts. “If we have 20 percent of the market, any claim to be a leader will be down the drain.”

Integrating renewables

Haug also criticized the Communication for promoting one single type of system integration of renewables.

According to her, there are three types: the German social choice of solar and wind, bioenergy elsewhere and other kinds. However, “we seem to be following the German case only”.

“We have to have a European strategy. Some will follow the German system, the majority will not,” Haug added.

Engaging cities and citizens

Another issue which sparked debate at the conference was the role of the cities in the energy transition.

Both Vitcheva of JRC and Haugh said cities should raise awareness, but also participate in convincing people. “If we are really serious, we have to provide grants” for pilot projects to cities, Haug added.

Hervé Bernard, Chairman of the European Energy Research Alliance, refocused attention to the issue of research. The EU should fund more basic research on materials, including those in the nuclear sector.

Linking research and industry

Torbjørn Digernes, Chair of the European Platform of Universities in Energy Research & Education, explained that societies can benefit from research if they have a good human resources policy.

We need to better integrate research and education. Educated people can then make the link between research and industry.

“We need smart people,” Digernes concluded.

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The project has received funding from the European Union’s Horizon 2020 research and innovation program under grant agreement No 785277.