A flurry of clean energy announcements in the European Union this year bodes well for the expansion of renewables but there will be a race against time to get key legislation adopted before next summer’s European elections.

The European Union has set ambitious targets for solar PV expansion but is Brussels designing the right policies to support growth? Andreas Walstad investigates.

Despite its faults and shortcomings, the EU’s Taxonomy Regulation is expected to support the energy transition and help redirect capital flows to renewables and green assets. Andreas Walstad examines how the taxonomy sets out criteria for technologies to be labeled green and environmentally sustainable in a bid to provide investors with a classification system that boosts clarity, accountability, and predictability.

U.K. carbon prices have looked relatively strong since the market launched in May. There is now optimism that the U.K. emissions trading system (ETS) will drive investment in renewables and green hydrogen. However, linking with the EU ETS is seen as key for the market to flourish in the longer term.

The European Commission’s antitrust investigation into EPEX Spot has revealed barriers for the integration of renewables in wholesale power markets. Challenges appear in a range of European marketplaces, but investigations and reforms appear to be clearing barriers to entry.

The European Commission will propose a number of new laws this summer and fall that are set to boost investment in renewable electricity and green hydrogen, reports Andreas Walstad in Brussels.

The carbon market is finally a reality in China. After 10 years of delays, regional pilot schemes and general uncertainty, China’s national carbon market became a reality on Feb. 1, 2021. Over time, the scheme is expected to support China’s gradual shift away from coal toward more solar and wind in power generation.

A new EU framework designed to incentivize cross-border renewables financing could help accelerate the roll-out of solar PV projects across Europe. However, investors are awaiting more clarity about how the system will work in practice.

European utilities with large exposure to renewable energy have performed well this year, despite a downturn in both energy demand and prices on the back of Covid-19.

Policy support for battery energy storage is gaining momentum across Europe as national governments remove regulatory barriers and the EU pledges financial support for this emerging technology. In several countries, revised capacity markets now allow energy storage operators to compete for subsidy contracts on a more equal footing with power generators. Support from the European Battery Alliance and €1 billion in loans from the European Investment Bank in 2020 alone should help shore up investor confidence. Battery storage will be a key component to support the growth of solar PV – but the rollout of projects will have to accelerate faster to fulfill this potential.