Abstract

Europe has focused on the development of renewable energy sources so as to decrease fossil fuel consumption and the dependence on fossil fuel imports. This is also in line with Europe's greenhouse gas emission reduction targets as specified in the Kyoto Protocol, to which Europe is a signatory. In Europe, the demand for solar energy for power generation and heating has been on the rise as capacity additions in the solar energy industry have continuously increased from 2002 to 2005. Some of the major factors that have influenced the demand for solar energy include rising oil consumption in Europe, increased share of imports in total oil consumed in Europe, and growing power consumption in Europe. If fossil fuel is to be replaced with renewable energy sources, the cost of generating renewable energy should be comparable with that of generating conventional power. Hence, Europe is developing technologies for producing low cost solar cells. Renewable energy can also be used as a decentralized source for providing power in remote locations. To increase solar energy consumption in domestic electricity and heating applications, Europe is promoting integration of solar energy systems in constructions. This will help to decrease the pollution resulting from conventional power generated for domestic applications. To support the generation of solar energy, Europe has introduced feed-in tariff and the green energy certificate system, and is conducting the sustainable energy campaign. A number of financing schemes for the development of renewable energy projects have also been introduced. In addition, at the country level, a number of regulations providing subsidies and tax rebates have been introduced. However, inconsistent federal support remains an issue that can hamper investment in the sector. In Europe, a major source of solar energy is from the solar cells installed in buildings for grid connected and off-grid power supply and the development of solar energy parks. Europe can also effectively utilize the desert areas for large-scale generation of solar power. Research and development is also being conducted to develop various methods to generate electricity and fuel from solar power. Power generation companies like BP Solar and leading financing companies such as GE Energy Financial Services have invested in the development of some of the world's largest solar parks in Europe.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

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Keywords

Solar Energy , Europe, Regulatory Environment, Photovoltaic Cell Production, Non-conventional Energy Sources, Kyoto Protocol, European Renewables Directive, Patient Capital Initiative, Sustainable Energy Finance Initiative, Fossil Fuel , Environment Management Pollution, Seed Capital Access Facility, Feed-in Tariff, Green Energy Certificate System, Q-Cells AG, BP Solar