Consequences for Spain Missing 20% Renewable Energy Target by 2020

In a meeting last week, the issue of Spain's failure to meet the EU's 20% renewable energy mandate by 2020 came up. I did some research into the consequences of this for Spain.

Directive 2009/28/EC passed in December of 2010 requires the EU to produce 20% of its final energy consumption and 10% of its energy in the transportation sector from renewable sources by 2020. Both the 20% and 10% targets are for the EU as a whole and the percentage of final energy production from renewable sources varies between countries based on their total energy consumption and starting  percentages in 2005.   The table below shows the 2005 starting point, the 2010 share of renewable energy, as well as the 2010 interim target and the 2020 target for Spain, Germany, and the EU as whole.

Country	2005 RE Share	2010 RE Share	2010 Target	2020 Target
Spain	8.7%	13.8%	10.2%	20%
Germany	5.6%	11%	8.2%	18%
EU	8.5%	12.7%	10.7%	20%

The information in the table is taken from the European Commission's 2013 Renewable Energy Progress Report. A Ren21 Global Progress Report in 2013 reported by the end of 2011, Spain’s renewable share of final energy generation at 15%.  This suggests that Spain may is not too far away from it’s 20% target; however, given the environment for renewable energy development, adding an additionally 5% of final energy generation will be a challenge, especially given the current overcapacity of generation.

The penalty for missing the 2020 target was not mentioned in Directive 2009/EC/28 to my knowledge, but some mention of a penalty was found in the final sentence of the Q&A section of the renewable energy progress report. The section states: “Finally, a failure to meet national binding targets could trigger infringement procedures against the relevant Member States.”  A few incidents of countries infringing upon Directive 2009/28/EC have already occurred though for different offenses. While the infringements seem minor in comparison to missing the 2020 renewable energy target, they offer some indication as to the magnitude of the penalty. The best example of infringement procedures I found concerned Poland and Cyprus’ failure to transpose the energy directive into law. Poland and Cyprus were fined €133,338.80 and €11,404.80, respectively. Despite the penalties, transposition of the energy directive is still pending. The penalty was calculated in a rather obscure manner by multiplying the following parameters together: seriousness factor, duration of the infringement, an “n” factor that varies between member states and depends upon their GDP, and a flat penalty, which currently stands at €640 per day. There may be well defined values for the "seriousness factor" and such, but I could not find any.

One last thing that needs to be evaluated is the European Commission's desire for economic stability and growth. When the time comes, it may put the stability of Spain's economy above the renewable energy target and either overlook the target or only levy a small penalty against Spain.

It is unclear how the EU will handle a country missing the 2020 target; however, not having a clear consequence for missing the target isn't a good start.