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Questions and Answers on the outcome of the first call for proposals under the NER300 programme
Commission Européenne - MEMO/12/999 18/12/2012
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Brussels, 18 December 2012
Questions and Answers on the outcome of the first call for proposals under the NER300 programme
Results of the first call for proposals
The Commission has awarded over €1.2 billion to 23 innovative renewable energy technology (RES) projects. The projects cover a wide range of renewable energy technologies - from bioenergy (including advanced biofuels), concentrated solar power and geothermal power to wind power, ocean energy and distributed renewable management (smart grids). The projects will be hosted in 16 EU Member States: Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Hungary, Ireland, Italy, the Netherlands, Poland, Portugal, Spain, Sweden and the United Kingdom. The projects awarded funding are listed in the Annex to this document, grouped in alphabetic order by technology category.
The projects awarded funding demonstrated that they represent the most cost-effective use of NER300 public funding, that they are financially and technically robust and that they fulfil strict eligibility criteria. This includes how innovative the technology is and the potential for it to be scaled up and replicated, as well as the reasonable expectation of the project being up and running by the end of 2016, the deadline for entry into operation.
The projects were chosen following a rigorous selection process. After an initial eligibility test carried out by Member States, applications were submitted to the European Investment Bank (EIB) which performed an in-depth technical and financial assessment of the project proposals. The EIB provided an initial ranking for the projects, based on the cost-per-unit performance - a measure of how much public funding is needed per unit of CO2 stored (for carbon capture and storage projects), or of clean energy produced (in the case of renewable energy sources). In July 2012, interim results of the NER300 programme were published in a Progress Report (SWD(2012)224 final), presenting a preliminary lists of candidate (top-ranked) and reserve projects in both CCS and RES groups. In October, Member States were asked to confirm their candidate and reserve projects, as well as the relevant funding package. On the basis of the final list of confirmed projects, the funding proportion between the CCS and the RES groups was established and the final list of projects for award was established. The funding decision was adopted by the European Commission following a positive vote in the Climate Change Committee on 13 December.
Most CCS projects put forward were not confirmed by the Member States concerned, and could therefore not be considered for funding awards. Member States were unable to confirm the projects for various reasons: in some cases there were funding gaps, while in others the projects were not sufficiently advanced to allow for confirmation within the timeframe of the first call for proposals.
The funds were raised from the sale of 200 million allowances from the new entrants' reserve (NER) of the EU Emissions Trading System. The sales were carried out by the European Investment Bank between early December 2011 and early October 2012. For more details, see http://www.eib.org/products/ner-300/reports.htm
Unused funds remain available for further projects under the NER300 programme in the second call.
One of the conditions of the NER300 programme is that projects must enter into operation/start generating renewable energy within four years of the funding award. The date of entry into operation of individual projects will take place between 2013 and 2016, with two thirds of projects scheduled to be operational before the end of 2015.
Projects will receive funding on an annual basis, based on proven performance. For the RES projects, this will depend on the amount of clean energy produced each year for the first five years following entry into operation. In recognition of the risks associated with such first-of-a-kind projects, only 75% of the targeted performance has to be achieved to receive full funding under the award decision. Annual funding payments are also conditional on specific knowledge sharing requirements (see question 10).
Annual payments will be transferred from the European Investment Bank to the Member States, which will in turn distribute the money to project sponsors.
The Member States play a central role in monitoring the projects. From the adoption of the Award Decision, Member States have to report on an annual basis to the European Commission on the progress made by the projects in their country, as well as on any problems with project implementation, and recommended solutions. Performance reporting following the project's entry into operation is one of the two conditions of funding (see question 7 above).
Under NER300, project sponsors who receive financing from the programme must report and share information on technical set-up and performance, costs, project management, environmental impact and any potential health and safety issues related to the project. The European Commission will check that information provided is complete and adequate.
The selected projects will bridge a critical gap in the innovation chain by specifically tackling some of the key obstacles that often hamper the large-scale deployment of technologies that have successfully been piloted. The funding awarded will help to lower costs, manage risks and tackle knowledge barriers. The €1.2 billion allocated to projects under the first call for proposals is already being matched by pledges of €2billion from private investors to cover the additional costs. In the short term the projects will add 10 TWh to the EU's annual renewable energy production. This corresponds to approximately the annual fuel consumption of more than a million passenger cars. Crucially, however, these projects are intended to spur new investment in the sector, leading to substantial increases in production capacity from renewable sources in the mid-term.
Collectively, the demonstration projects will create several thousand jobs during the construction phase (over the next 3-4 years). Once operational, about 1000 full- time workers will be needed to keep the demonstration projects running over their lifetime. Positive growth and employment effects are also intended along the supply chain feeding the sector.
Next Steps in the Implementation of the NER300 programme
The European Commission intends to proceed swiftly with the launch and implementation of the second call for proposals, covering the revenues of the remaining 100 million allowances as well as any unused funds from the first call for proposals (see question 5 above). Prior to the launch, the Commission and Member States will take stock of the experience gained from the implementation of the first call in the Climate Change Committee.
References and further reading
For more information on the NER300 Programme, visit:
See also IP/12/1385
PROJECTS AWARDED FUNDING
SHORT DESCRIPTION OF PROJECTS
Finland Bioenergy Ajos BTL
A biofuel-to-liquid plant in northern Finland will produce biodiesel and bionaphta in the Baltic Sea area for sale to a market primarily of diesel and petrol retailers. The plant will use some 950,000 tonnes/year (t/y) of woody feedstock and 31,000 t/y of tall oil to deliver an annual output of 115,000 t/y of biofuel. The innovative project will include biomass pre-treatment, a gasification island and gas-to-liquid conversion.
Italy Bioenergy BEST
Selected energy crops will be turned into second generation biofuels at a demonstration plant in Crescentino, near Turin in Italy. The highly innovative integrated biofuels plant will use giant cane, a new fast growing and drought-resistant energy crop, as well as wheat straw to produce ethanol. The plant will have an annual production capacity of 51 million litres per year.
Poland Bioenergy CEG Plant Goswinowice
Agricultural residues such as wheat straw and corn stover will become the basis for producing 60m litres/year of second generation bioethanol. The new plant in Goswinowice will be partially integrated with an existing first generation ethanol plant. Lignin and biogas by-products will provide fuel to the existing plant which in turn will provide steam for both plants.
France Wind VertiMED
The project comprises a floating offshore 26 MW wind farm located 50 km from Marseille. Thirteen wind turbines will be installed on 13 moored floating structures which will transfer power to an onshore substation connected to the grid.
France Bioenergy UPM Stracel BTL
A second generation biomass-to-liquid plant in Strasbourg will use about 1 million tonnes of woody biomass to deliver an annual output of 105,000 tonnes of biofuel. The plant is designed to be integrated into the paper & pulp production line of the existing paper mill, enabling exchanges of energy and products. The novel gasification technology will convert the biomass into gas before a gas-to-liquid conversion renders it fit for biofuels production.
Netherlands Bioenergy Woodspirit
Wood chips will be the feedstock for producing 286m litres/year of bio-methanol, equivalent to 228,000 t/y, in Farmsum. The bio-methanol will be produced using biomass torrefaction and entrained flow gasification as new core technologies to deliver a petrol additive for partial replacement of mineral fuel. (The figures in this paragraph were updated on 21 February 2013)
Sweden Bioenergy GoBiGas Phase 2
The plant will make use of forestry feedstocks from the areas surrounding Gothenburg to demonstrate large-scale conversion of low-quality wood into high quality synthetic natural gas for injection into the regional gas network. The facility will be an up-scaling of a successful Austrian pilot scale technology. The volume of 500,000 tonnes/year of wet biomass will produce 800 GWh/year of synthetic natural gas.
Sweden Bioenergy Pyrogrot
A new plant near the town of Skärblacka using forest residues as feedstock will produce 160,000 tonnes/year of pyrolysis oil to deliver 750 GWh of energy. The plant will operate at an input processing capacity of 720 tonnes/day of dry biomass.
Sweden Wind Vindpark Blaiken
The 225MW wind farm located in the Arctic climate of northern Sweden will comprise 90 wind turbines equipped with an innovative de-icing system made up of heating elements in the leading blade edges. The project, which will be constructed in 3 lots of 30 tubines over a three-year period, will be located close to the Juktan hydropower plant and connected to the national grid.
Cyprus Concentrated solar power Helios Power
A large-scale Stirling dish power plant sited on a field area of 200ha near the city of Larnaca will have a total installed capacity of 50.76 MWe. Each one of the 16920 Stirling dish units will capture concentrated solar irradiation from a reflector and convert the solar energy to electricity to supply the national grid.
Greece Concentrated solar power MAXIMUS
A large-scale Stirling dish power plant in the region of Florina will have a total installed capacity of 75.3 MWe. Each one of the 25160 Stirling dish units will capture concentrated solar irradiation from a reflector and convert the solar energy to electricity. The plant is composed of 37 small power plants, which will be connected to the grid via a single connection point.
Greece Concentrated solar power MINOS
The plant, to be sited near Atherinolakos in the southeast of Crete, is based on central tower technology with a nominal electrical capacity of 50 MWe. Heliostat mirrors will concentrate the sun irradiation on a solar receiver, and an innovative superheated steam technology will increase the efficiency of existing plants.
Spain Concentrated solar power PTC50-Alvarado
The plant near Badajoz will be a 50 MW central tower concentrating solar power (CSP) plant using superheated steam. A field of large tracking plain mirrors - heliostats - will serve to convert primary solar energy into electrical energy.
Belgium Distributed renewable management Slim
The project will develop and implement five smart grid 'building blocks' as the basis for a smart grid solution for the distribution grid in the city of Lommel, which already has a high penetration of renewable generation capacity. Associated network issues will be addressed through a combination of electricity market changes and smart grid control technologies to give improved visibility of distributed energy resources to the transmission system operator.
Hungary Geothermal South Hungarian Enhanced Geothermal System (EGS) Demonstration Project
A geothermal power plant, near the village of Ferencszállás in south-eastern Hungary, will use geothermal energy from hot dry rock in a compressional stress field. An Enhanced Geothermal System will involve the drilling of four 4km deep production wells and two re-injection wells, and the hydraulic fracturing of the reservoir under the compressional stress fields. Net capacity of the plant is 8.9 MWe; the electricity is expected to be sold to the electrical grid.
United Kingdom Ocean Kyle Rhea
An array of tidal turbines with a nominal capacity of 8 MWe will be built in the narrow strait between the Isle of Skye and the Scottish mainland. The project consists of four tidal energy twin rotor turbines, each one rated at 2MWe, and is based on a significant scaling up of the operational test turbine, which has a three-year track record in Northern Ireland.
United Kingdom Ocean Sound of Islay
An array of ten 1 MWe grid-connected tidal current turbines will be installed in deep water in the Sound of Islay off the west coast of Scotland. The tidal turbine technology will have a 3-bladed, seabed mounted design to deliver the overall net capacity of 10 MWe.
Ireland Ocean West Wave
A project located off the west coast of Ireland plans to demonstrate the potential of scaling up wave energy. Six wave energy capture devices will be placed at a depth of 15 metres. A prototype has already been tested at the European Marine Energy Centre (EMEC) in Orkney. The results of recent design changes and tests of an improved 800 kW design will feed into the final design, installation and operation of the project.
Germany Bioenergy VERBIO Straw
The town of Schwedt will host an extension to an existing ethanol-biogas plant where some 70,000 tonnes/year of straw will be the basis for delivering 25.6m m3 of biogas produced via a biochemical process, which will be cleaned to natural gas quality before being fed into the grid.
Germany Wind Innogy
The German Bight, 40 km north of Juist Island in the North Sea, is the location for an innovative offshore wind power project comprising 54 wind turbine generators with an overall capacity of 332 MW. A meteorological measurement mast (met mast) at the project site will monitor wind resources and conditions.
Germany Wind Veja Mate I
Located in the North Sea, north west of Borkum in the German "Exclusive Economic Zone" (EEZ), the project comprises the design, construction and operation of an offshore wind farm with a total capacity of 208 MW. It will consist of 32 turbines of 6.5MW some 90 km from the coast. The power generated will feed into an onshore grid.
Portugal Wind Windfloat
Five floating wind turbines with an overall capacity of 27 MW will be built some 14 km offshore from the coastline of Portugal. The Project will be built and installed in two stages. The first stage will consist of two WindFloat support structures and two 3 MW offshore wind turbines. The second stage will consist of three WindFloat support structures and three 7 MW offshore wind turbines.
Austria Wind Windpark Handalm
The mountainous region of Styria in Austria is the location for a wind demonstration project consisting of 11 turbines built at an average altitude of 1800 metres above sea level. The project, which will generate 72600 MWh of electricity annually, aims to demonstrate the large scale application of a wind turbine generator optimised for the special wind and site conditions of mountainous locations. The generators will be equipped with a system that offers remote control and reporting facilities.