Activity Report 2012 - Eurelectric

interview
EURELECTRIC Vice President Johannes TEySSEn
Mr Teyssen, last year you cited meeting the investment
needs as the biggest challenge for our sector.
How has the situation evolved since then? Are
investments still a concern?
Investments are and will remain a concern in Europe,
simply because the profound transformation of the
energy system is a matter of decades, not months. That is
why a coherent and holistic approach to energy policy on
a European level is desperately needed. At the moment,
overlapping instruments like the EU ETS, renewable
policies and energy efficiency targets are making
potential investors extremely cautious: they know that
such a situation is not sustainable, that corrections are
urgently needed – and so they wait with their investment
for a coherent and consistent 2030 approach to emerge.
If as a prudent investor you are certain that a complete readjustment
of EU policy is inevitable within the next few
years of course you stay away from the market and wait
for a more reliable situation.
Policymakers can now react in two ways: either improve
the situation by streamlining the energy package –
or introduce new subsidies in the hope of triggering
investments. I think our preferred approach is clear: new
subsidies would merely increase today’s unstable and
unsustainable environment and lead to higher costs
for energy consumers. Instead, the energy transformation
needs a clear and simple policy approach, ideally
with a strong EU ETS as the key driver of decarbonisation
that will also trigger renewable and energy efficiency
investments. The more market-oriented such investments
are, the better for the customer and for Europe’s
global competitiveness, which is defined by affordable
energy prices.
8 eurelectric activity report 2012
Competition is the only
approach that guarantees
affordable prices
Over the past year, discussions on EU energy policy
have increasingly focused on the time period after
2020, with policymakers looking ahead to 2030 or even
2050. What is your vision for Europe’s energy system
in 2030? And what needs to be done to get there?
My vision for 2030 is certainly not based on an exact
view, i.e. how much electricity should be delivered by
what source in which hour. Rather, it is based on an ideal
framework, needed to trigger investments into climate
friendly technologies while keeping energy affordable.
I therefore believe in a system with competition: this is
the only approach that guarantees affordable prices for
the customers in the long run, that triggers technological
innovation and that enables efficient investments. The
latter is of utmost importance for the second cornerstone
of my vision: the electricity system of the future is a
complex interplay of centralised and decentralised
generation, energy storage, smart grids with demand
response by customers. To find out in which segments
investments make the most economic sense, a market
price for electricity as a benchmark is certainly more
efficient than regulated prices for some or even all areas.
That is why a fully completed internal energy market by
2030 should be a matter of course. Finally, the EU ETS
should be the key driver of decarbonisation: the carbon
price will be incorporated into the electricity price and
this mechanism alone should deliver investment signals
for renewable energy and for energy efficiency measures.
With this vision the main areas for change are also clear:
a consistent energy package with no conflicting and/or
overlapping targets and a market design that will also
work in a world with a high share of renewable sources
and that has enough competitive elements to find the
most affordable solution for customers.
Finally, what would you say if asked to sum up, in not
more than 10 words, your hopes and ambitions for the
remainder of your term as EURELECTRIC Vice President?
Trigger policy for coherent and competition-based
approach to energy.