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NET ZERO INDUSTRY ACT

In its press release of 7 December 2023, WindEurope called for clear, EU-harmonised, technology-specific, and immediately applicable changes to the design of wind auctions. Only then will they help to expand the European wind energy supply chain to meet Europe’s energy security and climate goals, which require the EU to build around 30 GW of new wind turbines every year until 2030.

Trialogues on Net Zero Industry Act will start this month and go into Q1 2024. To have a positive effect on the European wind energy supply chain, qualitative criteria in the final deal must follow 5 principles:

1. They must be simple and easily applicable. The EU should especially max out on mandatory prequalification criteria for onshore and offshore wind auctions. This includes readily deployable rules for cybersecurity and data residency which will guarantee that Europe’s critical energy and grid infrastructure cannot be an easy target for cyberattacks.
2. They must be technologic-specific. Today almost all wind turbines installed in Europe are made in Europe. The EU has a strong domestic wind supply chain. This is not the case for all renewable technologies. The EU must take these fundamentally different starting conditions into account. Pre-qualification and non-price award criteria should therefore be technology-specific.
3. They must apply uniformly at EU level. The EU must adopt a harmonised approach to pre-qualification and non-price award criteria. It must avoid a patchwork of national auction rules.
4. They must apply right from the start. Prequalification criteria and, where relevant, non-price criteria should immediately apply to all wind energy auctions. The EU should not opt for a “phased-in approach” in which only 20% of auction volumes apply these criteria and the rest doesn’t. Phasing-in may make sense for other technologies but it’s not the right approach for wind energy.
5. The supply chain resilience criterion must be fit for purpose. Having the right approach to supply chain resilience in renewable energy auctions is at the core of the Net Zero Industry Act. Supply chain resilience criteria must apply to all wind auctions from the start. And they must recognise the contribution of the whole European supply chain, including the UK, Norway and Turkey.

“Getting auction design right will make or break the Net Zero Industry Act. It’s the only thing that matters, really. When it comes to wind, Europe needs to agree a limited set of pre-qualification and non-price award criteria that apply from the start. That must include a clear criterion on supply chain resilience reflecting the value of “made in Europe”. Failing to do that would only prolong the status quo: race to the bottom auctions which hurt the wind supply chain. And our ability to meet our climate and energy security objectives”, says Pierre Tardieu, Chief Policy Officer at WindEurope.

We’d like to recall that, in October this year, the European Commission published the Wind Power Package, which contains 15 immediate measures aimed at strengthening the wind energy industry in Europe. Some of these measures are to be taken by the Commission itself, others by the European Investment Bank, and some by national governments.

The main provisions of the Package also include a change in the Design of Wind Power Auctions. To consolidate its support for the Wind Power Package, the European Commission has developed the European Wind Charter and is calling on national governments to sign it. The signing of the Charter by EU energy ministers is expected on 19 December 2023 during the quarterly meeting of the Energy Council in Brussels.

The European Commission, to unite governments and industry in the implementation of the Wind Power Package, has invited wind energy companies to provide their logos to the Charter. The Ukrainian Wind Energy Association joined this initiative and has supported the European Wind Charter.