European renewables and gas companies join forces

Posted at November 2, 2012 » By : » Categories : News » Comments Off on European renewables and gas companies join forces

European renewables and gas companies Alpine Energie, DONG Energy, First Solar, GE and Shell launched a new partnership yesterday backing an integrated European energy policy for 2030 and beyond.

The Energy Partnership, which is being backed by the European Commissioner for Energy Günther Oettinger, aims to create a common pathway for the two industries towards low-carbon and cost efficient energy in the region.

“This partnership… is a brand new way of unifying the industry forces that are so essential for Europe to reach its 2050 de-carbonization and energy goals,” says Jan Ingwersen, vice president of DONG Energy.

The companies want to promote greater political and public understanding of the merits of an integrated renewables and gas energy market in Europe.

“Combining variable renewable energy and the flexibility of gas is key to Europe’s low-carbon energy future,” says Stephan Reimelt, CEO of GE Energy Germany.

Jörg Gmeinbauer, director of Alpine Energy, adds that Europe now needs integrated policies, market reforms and investment in energy generation, transmission, and infrastructure.

Without incentives to unlock new gas generation, Ingwersen warns that European generators may start to look towards coal again.

“Coal consumption is rising again and gas consumption fell almost 10% in 2011 and is headed for an even higher decline this year,” he says.

“Europe’s green transition is at risk if this trend is not reversed. Right now, there’s no business case for gas, and new coal production capacity is coming on stream in greater and faster volumes.”

Those incentives include the EU Emission Trading System (EU-ETS), under which the carbon price is now so low that it offers no economic argument to replace coal with renewables.

In the short term, removing allowances could boost the EU-ETS, he suggest, but more fundamental structural reform is needed to secure investment in clean energy.

“The key European driver for a low carbon future is at risk of dissolving if European leaders fail to recommit EU to the ETS,” Ingwersen warns.

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