Wind energy is the fastest-growing electricity-generating technology. The wind energy targets set during the last decade have all been surpassed. New targets are proposed for 2010 and 2020, since the existing European Commission and European Wind Energy Association targets do not reflect the trends in the market. The new targets and projections are used to define the role of wind energy in the electricity generation of the European Union during the next two decades. Estimation is made of the emission reductions which could be achieved with the use of wind energy by each Member State, and the contribution that wind energy could have in the process of the fulfilment of their Kyoto commitments is investigated. Finally an estimation of the costs involved is performed, with special reference to the avoided external costs. Copyright © 2003 John Wiley & Sons, Ltd.