Brussels, Belgium --- (METERING.COM) --- June 6, 2012 - With their isolated and small integrated power systems, Europe’s islands have the potential to be used as a test-bed for innovative technologies such as smart grids, storage and renewable energy systems, according to a new report from Eurelectric.

Further, this potential should be incentivized through research, development and demonstration support, thereby improving the situation of island power systems, while also providing learning and benefits to the mainland.

Eurelectric’s report is aimed to examine power generation in the EU’s 286 islands, which are home to some 2 percent (10 million) of the European population, and to present solutions towards sustainable energy systems.

According to the report, these islands are facing considerable challenges in meeting their energy needs in a sustainable, affordable and reliable way. In particular the five main challenges are market failure, inconsistent regulation, security of supply, emissions, and an import dependency.

However, the report finds that the island energy systems, despite their diversity, share common characteristics and are thus subject to common challenges. Their sustainable energy future depends on an improved investment climate and policy framework. In many cases, the limited size of their markets raises issues of market failure: complementary measures and remedies have to be found.

In addition to using the islands as a priority test-bed for smart grid and other technologies, and fostering RD&D, other recommendations include improving security of supply through diversified power generation technologies and interconnections, and setting up an island Sustainable Energy Action Plan 2020 containing island-specific measures up to 2020.

Examples of island projects that have been implemented include the advanced metering deployments in Cyprus and Malta and the EU-EcoGrid on Bornholm.