Eurelectric unveils four pillars of energy independence and decarbonisation

Faster electrification of Europe’s economy will allow it to “regain our independence, enhance energy security and fight climate change,” said EDF chairman and Eurelectric president Jean-Bernard Lévy.

Speaking at the opening of Eurelectric’s annual Power Summit in Brussels, Lévy said “climate change requires transformative action on a scale like never before”.

He said this urgency was compounded by the hangover of the coronavirus pandemic and the knock-on energy price effects of the war in Ukraine.

Yet he said there was a silver lining: an accelerated energy transition and electrification can get Europe out of these crises.

And he stressed that a renewed focus on decarbonisation was “not a focus on target X or target Y: our focus should be on the ‘how’: how to strengthen the grid; how to unlock speedier permitting; how to get greater clarity on taxonomy?”

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To focus minds on these ‘how’ questions, Eurelectric – the European trade body for electricity sector players – has released four action points, and at a press conference, Lévy outlined them in turn.

Raise the game on clean and renewable power generation

Lévy said the power sector is heading towards having 85% of EU electricity carbon-neutral by 2030 – but this is not fast enough. He said fast-tracked permitting for renewables – he included nuclear and biomass with wind and solar – and a skilled workforce are essential to ensuring this transition.

“Permitting, permitting, permitting,” he said. It was the cork that needs to be pulled for an outpouring of renewables.

To illustrate the problem of permitting, Melissa Stark of Accenture had earlier told the audience that the EU has four times more wind capacity stuck in the permitting stage than it currently has under construction.

Electrify everything that can be electrified  

Lévy warned that “the share of electrification is stagnating at 22%”. He said it is essential to fast-forward these stagnating electrification rates and bolster the deployment of heat pumps, electrolysers, smart charging infrastructure and storage solutions. 

Secure investments

Eurelectric highlights that €1200bn in investment is needed by 2030 to install the necessary clean energy capacity and ensure that grids can optimally support a carbon-neutral, decentralised and electric future. Levy said: “It’s not all about wind and solar – it’s also about transmission and distribution.”

Yet he warned that investors face a challenging market: distortive wholesale market interventions, ‘clawback” mechanisms and retail price caps deter investment in the energy transition and harm security of supply. “We must safeguard the integrity of the energy market,” he said. He stressed that the distribution grid alone needs a finance injection of €400bn between now and 2030.

He said the energy sector had enjoyed something of a “golden age of financing” but warned inflation was going to bring this to an end, which was why “unconsidered and distorted interventions in the market” like retail price caps and clawback measures were hindering the energy transition. “Not paying the full price for fossil fuels does not help the climate challenge.”

Yet he stressed that “public opinion is moving the needle very strongly towards ESG investments”.

Protect customers

Levy said that in times of high energy prices and volatility for consumers, it is essential to properly address the question of energy affordability, accelerate energy efficiency measures and ensure the social acceptance of the energy transition.

To sum up the journey ahead, Eurelectric Secretary General Kristian Ruby said: “We are at the beginning of a long curve. We have been fed cheap fossil fuels and now we have to get away from that addiction.”