(ADPnews) - Apr 26, 2010 - Central and Eastern Europe (CEE) is taking on the pressing challenge of boosting its renewable energy market amid the looming burden of the 20% by 2020 European Union target, Frost & Sullivan said in a recent analysis.
Five EU countries – Bulgaria, the Czech Republic, Hungary, Poland, and Romania – and one non-EU country, Turkey, are forecast to see high growth in their renewable energy markets in the coming years. This growth is attributable to their good incentive structure, the pressure of growing demand, and relatively good investor-friendly environments and encouraging governments.
The medium growth countries include Latvia, Slovakia and Slovenia. Although these countries have some good motivating factors, their market growth is hindered by lack of political will, uncertain support, and long cumbersome planning processes.
In order for CEE to maximise growth of its renewable energy markets, the region must cultivate political support and efficient incentive mechanisms with dedicated focus, the analysis said.
Until recently, CEE heavily relied on fossil fuels from Russia and largely ignored the potential of renewable energy sources. However, the region is now facing Russia's threat of cutting off energy supplies and the tough 2020 target, said the analysis. It comprises 19 country profiles including 11 EU countries, two candidate countries and six non-EU countries.
The EU Directive is impelling CEE countries to review their energy portfolios and develop a strategy to achieve those targets in the most efficient way, said Frost & Sullivan industry analyst Gouri Kumar. The targets, coupled with energy security issues, are boosting the renewable energy market in CEE, making it attractive for investors and market participants, he added.
"Although the challenges persist, the degree to which they are affecting the market is gradually reducing as the governments of several countries have begun to address these issues in their efforts to create a more conducive environment for investment," said Gouri. "It is moving slower than expected but the efforts are translating into growth in many sectors including the wind and solar energy markets."
Governments are pushing through important regulations that cater to the development of the renewable energy market. Such improvements in the regulatory framework coupled with the installation of new projects provide a prosperous foundation for the renewable energy market to thrive on, the analysis concluded.