A wind turbine being constructed. Wind generation rose 9% in 2020, with new installations set to increase further in 2021. Source: OX2

For the first time ever, renewable energy overtook fossil fuels in the EU's electricity mix in 2020, rising to 38% of overall generation as the share of fossil fuels declined to 37%.

"This is an important milestone in Europe's energy transition," think tanks Agora Energiewende of Germany and Ember of the U.K. said in a joint report Jan. 25.

Among the EU's 27 member states, Germany and Spain also saw renewables surpass fossil-fired generation for the first time in 2020, a feat also achieved by former EU member the U.K.

The COVID-19 pandemic had a limited impact on the overall trend from fossil fuels to renewables in the EU, according to the report.

"The rise in renewables was reassuringly robust despite the pandemic, and the fall in fossil-fired electricity could have been even more dramatic, had it not been for such a bounce-back in electricity demand and the worst year on record for nuclear generation," the authors said.

Indeed, renewables developers have come through the pandemic relatively unscathed thanks to priority grid access as well as growing resolve from policymakers to facilitate a green recovery from the crisis.

The EU's renewables growth has come exclusively from wind and solar since 2015, with hydropower unchanged and bioenergy growth stalling, Agora and Ember said. Wind generation rose 9% in 2020, and solar grew 15% year over year.

In the Nordics, however, hydro generation soared in 2020 due to high water reserves. The effect, combined with high wind speeds in northern Sweden and Norway as well as lower power demand, pushed power prices down in those areas, putting into question the attractiveness of new deployment in parts of the Nordics for some.

Wind power installations are set to increase sharply in 2021 due to new growth in France, Poland and Denmark. But for Europe to meet its climate commitments by 2030, the current trajectory of deployment is still too slow, the think tanks said. EU member states are adding about 72 TWh of new wind and solar capacity each year, below the 100 TWh required.

The largest increase in wind and solar generation was in the Netherlands, which had previously seen years of sluggish installations. Sweden and Belgium also saw strong levels of additions, while growth was subdued in Austria, Portugal, the Czech Republic, Italy, Romania and Slovakia.

Those countries have among the lowest share of green power in their generation mix. At the top of the list is Denmark, which saw renewables exceed 60% of its power generation in 2020.

Coal, nuclear phaseouts

Coal generation dropped 20% in 2020, and it has halved since 2015. The downward trend was accelerated by the pandemic as electricity demand fell.

Europe's largest coal generator, Germany, curbed coal-fired production even more sharply, briefly making neighboring Poland Europe's top coal generator for the first time ever.

Gas-fired power generation fell 4%, while nuclear power saw what was likely its largest-ever decline during the year, falling 10%. Gas acted increasingly as a buffer for lower coal and nuclear output, given its lower emissions profile and corresponding carbon costs.

Permanent closures of nuclear reactors, paired with problems at some plants, were behind the technology's record decline in 2020. Electricité de France SA outages saw French output drop 11%, and Vattenfall AB closed its Ringhals 1 power plant in Sweden, while EnBW Energie Baden-Württemberg AG shuttered the German Phillipsburg plant.

Further phaseouts are on the horizon, with Germany, Belgium, Spain and France aiming to reduce reliance on nuclear generation by 2035. "This illustrates once more the immediate need to increase the speed of adding wind and solar capacities," Agora and Ember said.