Pete Harrison, Reuters 2 Jun 09;
BRUSSELS (Reuters) - The European Union will boost economies and create an additional 410,000 jobs if the bloc meets its target of getting one fifth of its energy from renewable sources by 2020, a new report shows.
The 27-country bloc will boost gross domestic product (GDP) by a quarter of 1 percent in the process, the study prepared for the European Commission's energy department said.
The executive Commission introduced its green energy plan last year, with the aim of combating climate change and reducing Europe's dependence on unreliable imports of gas and oil.
But some member states fought bitterly against environmental policies, saying they were unaffordable and put jobs at risk at a time of economic turmoil.
The study appears to change the landscape for renewables by showing the shift will create benefits on all three fronts -- economy, climate and energy security.
"It is ... of immense value that increasing the share of energy from renewable sources not only does not harm the economy, but actually benefits it by creating jobs and increasing GDP," the report said.
Achieving the EU's green energy target will create a gross total of 2.8 million jobs in the sector, but the shift will hit jobs in traditional power plants and in industry due to higher power prices, yielding a lower net gain of around 410,000 jobs.
About two thirds of these are envisaged in small- and medium-sized enterprises.
CHEAPER POWER
"This is the most thorough analysis on employment I've seen in many years," said Christian Kjaer, chief executive of the European Wind Energy Association. "I think it will have a large impact."
GDP would have a net gain of 0.11-0.14 percent by 2020 under a business-as-usual scenario, but this can be boosted to a gain of 0.23-0.24 percent by pursuing the 2020 renewable energy goal, the report said.
"It also shows electricity prices will be around 7 percent lower if we go for the 2020 target scenario, compared to business as usual -- something we have been trying to say for some time," Kjaer said.
Germany currently experiences the biggest benefit from green energy, with nearly a quarter of the 1.4 million jobs in the EU renewables sector.
Other big winners include Finland, Sweden and Latvia, with heavy use of energy from plant biomass waste from farming and forestry.
Biomass energy creates over half the impact on jobs and economies, largely from growing and collecting the feedstock, followed by onshore windpower and hydropower.
The report assumes oil prices will increase to $100 per barrel by 2020 and carbon prices under the EU Emission Trading System will rise to 34 euros ($48.30) per tonne, from 15.30 today.
But it does not take account of the economic benefit of slowing climate change or of averting the industrial closures that occur when suppliers such as Russia cut gas flows, as happened in January.
(Reporting by Pete Harrison; editing by Sue Thomas)
