Three options to calculate the percentage renewable energy: An example for a EU policy debate

The European Commission proposed a renewable energy directive with binding targets for the percentage renewable energy, usually calculated with the primary energy method. This method has the disadvantage that for hydro and wind electricity production is counted, whereas for thermal electricity the higher input to power plants is counted. Therefore, the Commission looked for an alternative: the final energy method. Also this method has disadvantages. Firstly, electricity consumption is weighed equally to fuel consumption for heat and transport, neglecting higher primary energy demand for electricity. Secondly. non-energy consumption of energy commodities is neglected, artificially raising the percentage renewable energy. Therefore, I introduce a simple substitution method, which measures renewable energy by comparison with hypothetical equivalent conventional energy. Calculations for EU-27 show that the method strongly affects the contributions of different sectors (electricity, heat and transport), sources and countries. Concluding, any credible calculation method should reflect the trade off between conventional and renewable primary energy. A simple substitution method fulfills this condition, contrary to the primary and final energy method. Using these biased methods may result in policies that are inefficient in terms of saving conventional fuels and avoiding CO2 emissions, the main underlying goals of the proposed directive. (C) 2008 Elsevier Ltd. All rights reserved.