WORKPACKAGE3

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Introduction 3

Carbon Tax 4 Iceland - Carbon Tax 5

Communities 6 Scotland - Community & renewable energy scheme (CARES) 6

Electricity 7

Finland - Feed in tariff 7 Northern Ireland - Renewable Obligation Certificate (ROCS) 7 Norway - Green Battery Strategy 8 Republic of Ireland - REFIT Scheme 8

Heat 9 Northern Ireland - Renewable Heat Incentive 9

Liquid Biofuels 10

Republic of Ireland - Biofuels Obligation 10

Research and Development 11 Finland - BEST (Sustainable Bioenergy Solutions for tomorrow) 11 Norway - Centres for Environment / friendly Energy Research 11 Scotland - SMART Scotland 12

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Introduction

GREBEisa€1.77m,3-year(2015-2018)transnationalprojecttosupporttherenewableenergysector.Itisco-fundedbytheEU’sNorthernPeriphery&Arctic(NPA)Programme.Itwillfocusonthechallengesofperipheraland arctic regions as places for doing business, and help develop renewable energy business opportunitiesprovidedbyextremeconditions.

Renewable Energy entrepreneursworking in theNPA area face challenges including a lack of criticalmass,dispersed settlements, poor accessibility, vulnerability to climate change effects and limited networkingopportunitiesarewellrecognisedbecauseoftheirperipherallocation.

GREBEwillequipSMEsandstart-upswiththeskillsandconfidencetoovercomethesechallengesanduseplacebasednaturalassetsforREtobestsustainableeffect.Therenewableenergysectorcontributestosustainableregionalandruraldevelopmentandhaspotentialforfuturegrowth.

ThekeyobjectiveofthisworkPackage:

• To identify and promote opportunities for policy to provide an effective supporting framework forsustainablerenewableenergybusiness(bothnewandemerging)

Throughoutthe“Summaryreportoftherelevantpolicyinitiativesandschemesineachofthepartnerregionsstudy”GREBEhasidentifiedshowcaseexamplesforthebestpracticepolicyinitiativesthatcanbeusedacrosstheNPAregion.TheGREBEProjectdevelopedasafollowuptoapreviousNorthernPeripheryProgramme(NPP)ProjectknownasBioPAD.TheBioPADprojectcarriedoutinitialworkregardingpolicyinitiativeanalysisacrossEuropeinsupportoftheRenewableEnergysectorandGREBEaimstofurtherdevelopandrefinethisworkandtakeittothenextlevel.

Thepolicy pagewithinBioPAD shows someexamples of this priorwork including a policy tour, policy gapsanalysis and policy recommendations in this area and can be found at: http://www.biopad.eu/what-is-biopad/policy/.

Whilethisprojectwasmainlyfocussedonbioenergy,thereisalotofinformationforHeat,Electricity,BioFuels,Transport, Low-carbon etc. in other European countries in the http://www.biopad.eu/wp-content/uploads/RASLRES-Policy-Toolkit.pdf.

Basedonfeedbackgatheredfromallpartnerregionstherewereatotalof67policyinitiativesinthe“Summaryreportoftherelevantpolicyinitiativesandschemesineachofthepartnerregionsstudythathelpcontributetowardssupportingtherenewableenergysector.TheGREBEreportwillshowcaseexamplesofbestpracticepolicyinitiativesunderthefollowingcategories.

• CarbonTaxAtaxonfossilfuels,especiallythoseusedbymotorvehicles,intendedtoreducetheemissionofcarbondioxide.

• CommunitiesSupportinglocalcommunitiesandhelpingtowardcreatingabetterenvironment

• ElectricityHelppromotethegenerationofelectricity

• HeatContributiontowardspromotingheatfromarenewablesource.

• LiquidBiofuels

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Themostwidelyusedliquidbiofuelsfortransportareethanolandbiodiesel.

• Research&DevelopmentResearchanddevelopment(R&D)referstotheinvestigativeactivitiesabusinessconductstoimproveexistingproductsandproceduresortoleadtothedevelopmentofnewproductsandprocedures.

Itisdifficulttoanalyseandcomparethesuccessorimpactofpolicyacrossdifferentnations.Whileapolicymaybeasuccessbasedonlocalconditionsitmaynotbewhencomparedtoanotherregion.ForexampleFinlandcreatedapolicytoplant100,000Haoftrees. InIcelandapolicywasput inplacetoplant1,000Haoftrees.50,000HaoftreeswereplantedinFinlandand2,000HawereplantedinIceland.SowhileFinlandfellshortoftheirpolicytargetandIcelandexceededthetargetset,whenconsideringthetotalareacoveredincomparisontherearedifferentmeasurementsofsuccess.

Forthisreasonithasbeendecidedthatseveralaspectsofprojectmustbeassessedandanalysedinconsideringwhether a policy has been successful and for this reason the following four titles have been selected asrepresentativeofawiderangeoffactorsthathelpshowtheimpactofapolicy.

• Strategy• Purpose• Uniquefeatures• Fundingtechnique

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Carbon Tax

Carbontaxisataxonfossilfuels,especiallythoseusedbymotorvehicles,intendedtoreducetheemissionofcarbondioxide.PolicyinitiativesarerequiredtoencouragetheuptakeofCarbonTaxschemesasreducingtheamountofCarbonusedwillrequirea largebehaviouralchange.Thischangewillbedifficulttoencourageaspeoplearesetintheirwaysandrequireanincentivetomakethechanges.

AnexampleofbestpracticeofapolicyinitiativeforcarbontaxisinplaceinIceland.

Iceland - Carbon Tax

Strategy–Acarbontaxisataxbasedongreenhousegasemissions(GHG)generatedfromburningfuels.Purpose - It puts a price on each tonneofGHGemitted, sending a price signal thatwill, over time, elicit apowerfulmarketresponseacrosstheentireeconomy,resultinginreducedemissions.Uniquefeature–Acarbontaxisafeeintendedtomakeusersoffossilfuelspayfortheclimatedamagetheirfueluse imposesby releasing carbondioxide into theatmosphereandalso tomotivate switches to cleanerenergy.Placingataxoncarbongivesconsumersandproducersamonetary incentivetoreducetheircarbondioxideemissionswhileadjustingpricesoffossilfuelstoreflectthedamagestoourplanetandsocietycausedbyreleasingCO2intotheatmosphere.Fundingtechnique–N/A

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Communities

Policyinitiativesforrenewableenergyareaimedatsupportinglocalcommunitiesandhelpingtowardcreatinga better environment.While prices for renewable energy or heating infrastructure can be prohibitive on aprivatelevel,thecreationofcommunityledschemeshelptooffsetthiscost.Schemesmayalsobringprofittothecommunitythroughenergythatcanbesoldbacktothegrid.

AnexampleofbestpracticeofapolicyinitiativefordevelopmentofcommunityenergyisinplaceinScotland.

Scotland - Community & renewable energy scheme (CARES)

Strategy-TheCARESloanfundwasannouncedbytheScottishGovernmenton15thFebruary2011.Theschemeaimstoprovideloanstowardsthehighrisk,pre-planningconsentstagesofrenewableenergyprojectswhichhavesignificantcommunityengagementandbenefits.TheschemeismanagedonbehalfofScottishMinistersbylocalenergyScotland.

Purpose - To support the development of locally-owned renewable energy projects which provide widercommunitybenefits?

Uniquefeature-Anyrenewableenergyproject,upto5MW,requiringfinancialoutlaypriortoplanningconsentis,inprinciple,eligible

• Loansofupto£150,000

• Coverupto90%ofagreedcosts

• Securitynotrequired

• Fixedinterestrateat10%

• Localadviceandsupportavailable

• Competitiveprocess

• Financeprovidedinstagesaccordingtoagreeddrawdownschedule

Fundingtechnique-Loanfinancewillbeavailabletocoverthepre-planningconsent(highrisk)stageofprojectdevelopment,ahighriskcostwhichiswidelyseenasabarriertocommunitygroupsandsmallerbusinesseswhowouldotherwisewishtodevelopaproject.

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Electricity

Initiatives are created with the aim of helping to promote the generation of renewable electricity. Theinstallation of renewable energy systems on an individual’s property can require a large initial investment.Providing financial incentives is one way in which the risk involved can be negated to encourage privateinvestment.

ExamplesofbestpracticeofpolicyinitiativesfortheelectricitysectorisinplaceinFinland,NorthernIreland,NorwayandintheRepublicofIreland.

Finland - Feed in tariff

Strategy–Thefeed-intariffschemeforelectricityhasbeendesignedtoincreasetheuseofrenewableenergysourcesinelectricityproduction.TheEUhassetarequirementforFinlandtoachieveanincreaseinrenewableenergieswherebytheywillaccountfor38%offinalconsumptionbytheendof2020.Feed-intariffisgrantedbyTheEnergyAuthority.

Purpose-ThesinglebiggestreasonfortheboomingoftheFinnishwindpoweristhefeed-in-tariffsystemthatwasimplementedinspring2011.

Uniquefeature-Afeed-intariffisavailablefor

-Newwindpowerplants

-Newbiogaspowerplants(gasproducedbydigestion)

-Newwood-fuelledpowerplantswhichalsoproduceheatforutilization

-Timberchippowerplants

Funding technique - The targetprice is EUR83.50/MWh.However,windpowerplants receivean increasedtargetpriceofEUR105.30/MWh.

Northern Ireland - Renewable Obligation Certificate (ROCS)

Strategy–Providesincentivesforlarge-scalerenewableelectricitygenerationbymakingUKsupplierssourceaproportionoftheirelectricityfromeligiblerenewablesources.Theaimistoincreasetheamountofelectricitysuppliedbyelectricitysuppliersfromrenewablesources.

Purpose - Renewable Obligation Certificates (ROC’s) are green certificates given to generators that useaccreditedrenewablesystemstocreateelectricity

Uniquefeature–Theserenewableobligationcertificatescanbetraded.IfsuppliersofelectricitydonotpresentthecorrectamountofROCstheyaremadetopaytheequivalentamountintoabuyoutfund.Thisencouragesthemtosourcemoreoftheirelectricityfromrenewablesources,insteadofbeingfinedfornotmeetingtheirobligation.

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Fundingtechnique–ThenumberofROCsissuedtoeachgeneratordependsuponthetypeoftechnologyituses(eachtypefallsundera'bandinglevel')andtheamountofelectricityitgenerates.

ThedefaultpositionisthatoneROCisissuedperMWhgenerated.However,sometechnologiesreceivemoreROCsandothersreceivefewer.Forexample,offshorewindreceivestwoROCsperMWhwhileonshorewindreceives0.9ROCperMWh.

Norway - Green Battery Strategy

Strategy–Norwayishopingtobecomethe“greenbatterycapitalofEurope”byusingitshydropowerplantstoprovideinstantextraelectricityifproductionfromwindandsolarpowersourcesinothercountriesfade.

Purpose-Norwayhas937hydropowerplants,whichprovide96%ofitselectricity,makingitthesixthlargesthydropowerproducer in theworlddespitehavingapopulationofonly fivemillion. Europealreadyhas400millionpeoplein24countriesconnectedtoasinglegrid,withpowersurplusesfromonecountrybeingexportedtoneighboursorimportedasnationalneedschange.

Uniquefeature-Withoutbuildinganynewpowerstations,engineersbelievetheycouldusetheexistingnetworktoinstantlyboostEuropeansuppliesandavoidothercountrieshavingtoswitchonfossilfuelplantstomakeupshortfalls

Fundingtechnique-ThecustomerswhoalreadyexistinNorwaywillhavetopaythebillfornewlinesconnectingNorwaytoothercounties.

Republic of Ireland - REFIT Scheme

Strategy – TheRenewable Energy Feed in Tariff (REFIT) schemes/supports are funded by the Public ServiceObligation(PSO)whichispaidforbyallelectricityconsumers.

Purpose - The REFIT schemes have been designed to incentivise the development of renewable electricitygeneration inordertoensureIrelandmeets itsgoalof40%ofelectricitycomingfromrenewablesourcesby2020.

Uniquefeature-REFITisdesignedtoprovidepricecertaintytorenewableelectricitygenerators.Ithasbeeninoperationforwindandhydropowersince2006.Itoperatesonaslidingscale,actingtoensureaguaranteedpriceforeachunitofelectricityexportedtothegridbypayingthedifferencebetweenthewholesalepriceforelectricityandtheREFITprice

Fundingtechnique–Thesupportpriceunderthegovernment’sRenewableEnergyFeed inTariff (REFIT)willrangefrom8.5centperkilowatthourto15centperkilowatthourdependingonthetechnologydeployed.ThetechnologiessupportedincludeAnaerobicDigestionCombinedHeatandPower,BiomassCombinedHeatandPowerandBiomassCombustion, includingprovision for30%co-firingofbiomass in thethreepeatpoweredstations.

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Heat

Policyinitiativesandschemesprovideacontributiontowardspromotingheatfromarenewablesource.Initialcostsforrenewableenergyinstallationscanbeoffputting,andpoliciesinitiativesinthisareacanhelppromotetherenewableheat.

Anexampleofbestpracticeofapolicyinitiativefordevelopmentoftherenewableheatsectoris inplaceinNorthernIreland.

Northern Ireland - Renewable Heat Incentive

Strategy - Financial incentive toencourage theuptakeanduseof renewableheat suchasbiomass systems,ground/airsourceheatpumps,geothermalandbiogasbelow200kWth.

Purpose–Businessesmustmeettheeligibilitycriteriawhenapplyingforaccreditation.Theremustbeatleast1nondomesticusefortheheatbeingproducedandtheinstallationmustmeetotherrequirements;beingnewattimeofinstallationandtheheatbeingproducedmustbemeteredcorrectlyetc.

Uniquefeature-DepartmentofEnterprise,TradeandInvestmentsetthepolicyandtariffrates,withpaymentsbeingguaranteedfor20years.OfgemadministertheschemeonbehalfofDETI.

Fundingtechnique-WhentheRHIcommencedaboilerrangingfrom20–199kWwouldreceive6.4pperkWheat generated. Therewas no upper usage cap. The tariff changed on the 4th of November 2015with theintroductionofa capwhere the first1314peakhours (1314xboiler kWh)arepaidat theTier1 tariff.AnyadditionalheatispaidattheTier2tariffuptoamaximumof400,000kWh.

UnfortunatelytheRenewableHeatIncentivehasbeendiscontinuedduetoarangeoffinancialmismanagementissues.

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Liquid Biofuels

Themostwidelyusedliquidbiofuelsfortransportareethanolandbiodiesel.Biofuelshavebeenselectedasapolicyinitiativeareaduetoseveralfactors–theyarecleanerthanfossilfuelsandcanbedevelopedfromlocalcropsreducingdependenceonimportedfuelsandincreasingenergysecurity.

AnexampleofbestpracticeofapolicyinitiativefordevelopmentofliquidbiofuelsisinplaceintheRepublicofIreland.

Republic of Ireland - Biofuels Obligation

Strategy–Ireland’stargetfortheshareofitsgrossfinalconsumptionofenergytocomefromrenewablesources,by2020,is16%.

Purpose-TheBOSSchemeplacesanobligationonsuppliersofmineraloiltoensurethat6.383%(byvolume)ofthemotor fuels (generallyGasolineandMotorDiesel) theyplaceonthemarket in Ireland isproducedfromrenewablesources,e.g.EthanolandBiodiesel.

Uniquefeature-Thismeansthatattheendofeachyearanobligatedroadtransportfuelsuppliermustholdsixbiofuelobligationcertificatesforevery94litresofpetroleumbasedfuelithasplacedonthemarket.Certificatesare issued forbiofuels thathavebeendemonstrated tohavecompliedwith thesustainabilitycriteriaof theDirective.

Fundingtechnique–N/A

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Research and Development

Researchanddevelopment(R&D)referstotheinvestigativeactivitiesabusinessconductstoimproveexistingproductsandproceduresortoleadtothedevelopmentofnewproductsandprocedures.R&Dcanbebeneficialinmanywaysincludingdrivingtechnologicaladvancesandbringingdownpricesandalsohelpingtochangetheoutlookonrelianceforfossilfuels.

Finland, Norway and Scotland provide examples of best practice of policy initiatives for research anddevelopment.

Finland - BEST (Sustainable Bioenergy Solutions for tomorrow)

Strategy–TheresearchprogramjoinsthestrengthsofthedifferentplayerswithintheFinnishbioenergyfieldtoanswertothecriticalresearchanddevelopmentneedsoftomorrow.

Purpose-Basedontheseglobaldrivers,BESTaimsat:

1. Radicallyimprovingthevalue/costratio,reliabilityandflexibilityofsupplyingdifferentbio-basedrawmaterials

2. Enablingtheincreasedavailabilityofbiomassrawmaterialsinasustainableway3. Creatingdifferentlocalenergyconceptsandnewconceptualdesignsforprocessintegration4. Boostingtheabilitytotailorbioenergysolutionstomeetthespecificrequirementsofeachmarket5. Creatingwaystosystematicallyassessthedevelopmentofthebusinessenvironmentanddeveloping

abilitiesforadoptingbothproactiveandreactivestrategies6. Activelydisseminatingtheresultsandtakingpartintheinternationalbioenergydiscussion

Uniquefeature-SustainableBioenergySolutionsforTomorrow(BEST)isaresearchprogramlaunchedinearly2013.Theprogrampartnerscurrentlyconsistof21companiesand13universitiesorresearchinstitutes.

Fundingtechnique-Theplanneddurationisfouryears(2013-2016)withanannualbudgetofroughly4MEUR.TheprogramiscoordinatedjointlybyCLEENLtd.

Norway - Centres for Environment / friendly Energy Research

Strategy-Thiswillconductlong-termresearchatahighinternationalstandard,withtheaimoftacklingenergy-relatedchallenges.

Purpose-TheobjectiveoftheschemeforCentresforEnvironment-friendlyEnergyResearch(FME)istoestablishtime-limitedresearchcentreswhichconductconcentrated,focusedandlong-termresearchofhighinternationalcalibreinordertosolvespecificchallengesinthefield.

Uniquefeature-Encourageenterprisestoinnovatebyplacingstrongeremphasisonlong-termresearchandbymakingitattractiveforenterprisesthatworkontheinternationalarenatoestablishR&DactivitiesinNorway.

- Facilitateactivealliancesbetweeninnovativeenterprisesandprominentresearchgroups.- Promotethedevelopmentofresearchgroupsthatareonthecuttingedgeofinternationalresearch

andarepartofstronginternationalnetworks.

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- Stimulate researcher training in fields of importance to the user partners and encourage thetransferofresearch-basedknowledgeandtechnology.

Fundingtechnique-ThetotalbudgetallocationfromtheResearchCouncilforthe11centresofFME-schemewillamounttoabout1200MNOKoverthelifespanofeightyears.

Scotland - SMART Scotland

Strategy - Provides grants too Small toMedium Enterprises (SMEs) based in Scotland. The grant helps youundertaketechnicalfeasibilitystudiesandresearchanddevelopment(R&D)projectsthathaveacommercialendpoint.

Purpose-SCOTLANDResearchandDevelopmentGrant(R&Dgrant)ofupto35%oftheeligibleprojectcosts,uptoamaximumgrantof£600,000,maybeavailabletohelpyoudevelopapre-productionprototypeofanewproductorprocess

Uniquefeature-seekstoachieveitsobjectivesbyprovidinggrantsonadiscretionarybasisfor,technicalandcommercialfeasibilitystudiesandresearchanddevelopment(R&D)projects.

Fundingtechnique-Supportsupto70%oftheeligiblecostsforasmallSMEandupto60%oftheeligiblecostsforamediumSME.Studiesmustlastbetween6and18months,andthemaximumgrantis£100,000.Onethirdofthegrantispaidupfrontwhentheprojectstarts.Theremainderispaidquarterlyinarrearsagainstclaimssubmitted.

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