Energy in Europe — State of play

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Article Published 29 Aug 2017 Last modified 25 Sep 2017
9 min read
European countries consume less energy compared with 10 years ago, mainly due to energy efficiency gains. Europe also relies less on fossil fuels due to energy savings and the faster-than-expected uptake of renewable energy. In the decade 2005-2015, the share of renewables in the EU’s energy consumption nearly doubled, from 9 % to almost 17 %. Some sectors and countries are leading the way towards clean energy. Despite their declining share of the market, however, fossil fuels continue to be the dominant energy source in Europe.

© Keith Arkins, Environment & Me /EEA

In May 2016, the Portuguese Renewable Energy Association announced that Portugal met its electricity needs entirely from renewable sources for four consecutive days  — 107 hours to be exact. Achievements like this are becoming more commonplace across the EU. On certain days, Denmark can generate more than 100 % of its electricity needs from only wind energy and have enough spare to power parts of Germany and Sweden.

Europe consumes less energy and less fossil fuel

Renewable energy sources provide a rapidly increasing share of the energy used in Europe. Nevertheless, the largest proportion of the energy consumed in the EU still comes from fossil fuels (72.6 % in terms of gross inland consumption in 2015), although their share in the energy mix has been falling steadily.

Similarly, Europe’s overall energy consumption decreased by more than 10 % between 2005 and 2015 and amounted to almost 1 630 million tonnes of oil equivalent (Mtoe) ([1]) in 2015. This significant reduction was due to energy efficiency improvements, the increase in the share of energy from hydro, wind and solar photovoltaic sources, structural changes in the economy and the economic recession of 2008. Warmer winters have also contributed, as they have reduced the amount of energy used in heating.

Electricity generation

The move away from fossil fuels is quite prominent in many sectors. The biggest reduction between 1990 and 2015 was in electricity generation from coal and lignite, which was mainly replaced by electricity generation from natural gas during the 1990s and up until 2010, mainly due to decreasing gas prices. More recently, however, natural gas lost some ground, due to a combination of factors. These include the rapid uptake of renewable electricity generation and the economic downturn of 2008, which lowered the overall demand for electricity. The increase in gas prices, driven by the gas-to-oil price indexation, and low carbon prices, due to the surplus of emission allowances on the market, have also played a role.

It is clear that the substitution of coal and oil with cleaner alternatives contributes to significant reductions in greenhouse gas emissions in sectors closely linked to electricity consumption in particular. In fact, this substitution also contributes to the ongoing energy transition in Europe from an energy system that is based predominantly on fossil fuels towards a system based on renewable and clean energy sources.

In 2015, nuclear energy generated 26.5 % of electricity in the EU and it remains one of the largest generators of electricity after fossil fuels and renewables. Several EU countries intend to move ahead with decommissioning nuclear plants in the wake of the Fukushima incident of 2011. The costs of nuclear electricity generation have since risen in some countries because of extra investments in maintenance and safety measures, which make electricity from nuclear sources more expensive and hence less competitive compared with electricity from other sources. Such nuclear incidents are also known to affect public opinion in their aftermaths. Shifts in public opinion, along with considerations of rising costs, prompt some governments to decommission nuclear power plants and/or to invest in other energy sources.

A power plant, once operational, can generate electricity for decades. When choosing the energy source to be used for power generation, existing and planned plants, as well as their capacities and life spans, must be taken into account. Not taking these into account might result in investing in new fossil-fuel-based power plants . Such investment decisions should also be taken bearing in mind the EU’s long-term climate goals.

Growth in renewables

Since 2005, renewable energy has grown quickly, taking many market actors by surprise. This growth can be attributed to renewable energy support policies at national and EU levels, along with significant cost reductions in renewable energy technologies in recent years, in particular wind power and solar photovoltaics. In fact, all EU Member States have renewable energy policies and support schemes in place to help favour their use.

The effects of these efforts are already visible. Many European households can now buy electricity generated from renewable sources such as wind, solar and biomass. On the production side, in 2015, renewable energy accounted for 77 % of new generating capacity in the EU.

According to the latest Eurostat data , in terms of gross final energy consumption ([2]), the proportion of energy from renewable sources rose to almost 17 % in 2015, from 9 % in 2005. This is one of the headline indicators of the Europe 2020 strategy, which sets the target of 20 % of gross final consumption from renewable sources by that date. EU institutions are currently discussing a proposal that would set the EU’s target for 2030 at a share of at least 27 %, as renewables are expected to play an ever more important role in helping Europe meet its future energy needs.

The transport challenge

The uptake of renewable energy varies between countries and energy market sectors (i.e. electricity, heating and cooling, and transport). Renewable energy represented a significant share of energy use in energy market sectors in 2015, although it contributed only 6.7 % of transport energy use despite the growth in consumption of biofuels.

Road transport has achieved considerable improvements in energy efficiency in recent years. This can be explained by improvements in fuel efficiency as a result of EU vehicle emission standards for new passenger cars and vans. Despite these efficiency gains, the demand for road transport has been growing, which led to a slight increase in greenhouse gas emissions from this sector in 2014 and 2015.

Although decreasing, greenhouse gas emissions per passenger-kilometre ([3]) from air transport are still considerably higher than those from road transport, while rail transport remains the mode of passenger transport with the lowest emissions per passenger-kilometre.

Countries moving towards renewable energy sources

In all EU Member States, consumption of renewables has increased since 2005. Sweden is by far the best performer, with 53.9 % of its gross final energy consumption in 2015 coming from renewable sources. Finland (39.3 %) comes next, followed by Latvia, Austria and Denmark. In fact, 11 Member States have already reached or bettered their 2020 target set under the EU’s Renewable Energy Directive.

The sources of renewable energy differ significantly across EU Member States. For example, Estonia relies almost entirely on solid biomass, whereas more than half of Ireland’s primary renewable energy production comes from wind power, while Greece’s renewable energy consumption comes from a wider range of sources, including biomass, followed by hydro, wind and solar power.

Impacts of our fuel choices

Nuclear waste is notoriously difficult to dispose of safely, while fossil fuels are closely associated with air pollution and climate change. Combustion of fossil fuels releases air pollutants (nitrogen oxides, sulphur oxides, non-methane volatile organic compounds and fine particulate matter), as well as greenhouse gases, into the atmosphere. Combustion of biomass can also have similar impacts on air quality and climate change. Moreover, biofuels may create land use issues, putting extra pressure on land and water resources. Using agricultural and forestry residues or used cooking oil to produce second-generation biofuels can help to reduce some of these pressures.

Some economic sectors are closely linked to specific air pollutants. Given that most road vehicles have combustion engines, road transport is a significant source of nitrogen oxides and particulate matter, which affect urban air quality, in particular. Similarly, the energy production and distribution sector is responsible, among other things, for more than half of sulphur oxides emissions and one fifth of nitrogen oxides emissions in the 33 EEA member countries (EEA-33) ([4]).

Although air pollutant emissions have decreased significantly in most EU countries, current levels still pose a significant risk to human health, as air pollutants can aggravate, among other things, respiratory and cardiovascular diseases. Depending on the pollutant, they can also contribute to climate change and affect the environment. For example, black carbon is one of the common components of soot found mostly in fine particles (smaller than 2.5 microns in diameter). In urban areas, black carbon emissions are caused mainly by road transport and diesel engines in particular. Besides its impacts on human health, black carbon in particulate matter contributes to climate change by absorbing the sun’s heat and warming the atmosphere.

Resource use in a circular economy

Whatever fuel we choose to meet our energy needs, it will require using resources — land, water, minerals, wood, and energy. In the case of fossil fuels, to tap into new reserves and extract them, public and private funds would be used in building new onshore and offshore sites, power plants and refineries, pipelines to transport them, etc. In addition to their impacts on health, air quality and the climate, the extra demand and dependence on fossil fuels might also induce countries to expand their drilling activities to new regions and use more land or marine areas for extraction, resulting in new risks such as oil spills and pollution.

Similarly, an exponential growth in renewables might be associated with increased demand for materials such as rare earth elements, which are used in batteries or photovoltaic panels. Like other energy generation activities, solar panels and wind farms also need space — either on land or at sea. Similarly, productive land and fresh water resources are very much in demand for bioenergy production, including for biomass and biofuels. It is not always easy to determine how much land — or surface area in general — is needed to generate renewable energy in sufficient amounts to phase out fossil fuels. Furthermore, the energy generation potential from renewables and the source of renewable energy can vary substantially from one region to another. Some countries might have higher solar and wind potential, while others could potentially meet almost all their energy needs from geothermal energy.

Moreover, from solar panels to pipelines and power plants, energy generation equipment and infrastructure will become obsolete after a number of years. The materials used will also have to be dealt with at the end of their lives. In fact, renewable energy can offer us the opportunity to design our technical solutions, such as solar panels, according to circular economy principles, whereby different components and resources can be re-used, recovered and recycled.

Potential gains are not limited to components’ end of life and their re-use and recycling. Better landscape planning and urban design — such as integrating solar panels in rooftop materials or highway noise barriers — can also alleviate some concerns over land use, as well as over noise and visual pollution.

Technological solutions or design can certainly help reduce the negative impacts of our current energy use. As households, investors, consumers and policymakers, our energy choices favouring clean and smart energy use could in fact be a force powerful enough to bring about a total overhaul of the way we consume and produce energy within decades.

Similarly, a more efficient use of all resources, by preventing waste, re-using and recycling, could help reduce the overall need for energy. After all, we use energy to grow food and produce consumer products. Every time we throw them away, we waste the resources — energy, water, land and labour — used in producing and bringing them to us.

([1])            For the sake of comparability, the energy content of various fuels is converted to oil equivalents — i.e. the energy intensity of oil.

([2])            Gross final energy consumption is defined as energy commodities delivered for energy purposes to final consumers (industry, transport, households, services, agriculture, forestry and fisheries), including the consumption of electricity and heat by the energy branch for electricity and heat production, and including losses of electricity and heat in distribution and transmission.

([3])            Passenger-kilometre represents the transport of one passenger by a defined mode of transport (road, rail, air, sea, inland waterways, etc.) over 1 kilometre.

([4])            EEA member countries comprise the EU-28, Iceland, Liechtenstein, Norway, Switzerland and Turkey.

Energy in Europe: State of play


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