Analysis  |  24 September 2012

The end of the honeymoon period for renewables

By Timon Dubbeling

Electricity markets across Europe are experiencing a once-in-a-generation transformation, which is largely driven by the exponential growth of intermittent generation from renewable energy sources - solar PV and wind in particular. Although the rise of such renewables is both necessary and inevitable in the transition to a low-carbon economy, it is becoming increasingly difficult and costly to integrate them into the current power system. Inevitably renewable generators will be asked to play a bigger role in managing the impact their production has on electricity systems. In addition, they will have to deal with reduced financial support and legal prerogatives as policymakers will try to end their insulation from energy markets. The honeymoon period for renewables is ending, and their existence in electricity markets is bound to get a lot more challenging.

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