Europe has five central energy aims: climate protection, reducing dependence on imports (particularly for renewable sources), diversification of suppliers, improving efficiency and researching innovative CO2-free technologies. For more than 10 years the European Commission has also been seeking greater competition in the electricity and gas industries, with plans for unified markets in both sectors to guarantee supplies and market-based prices.
Yet the Commission’s ambitions are not going to come to fruition any time soon. Unified energy markets require a pan-European regulatory authority capable of breaking up outdated market structures and creating a level playing field for all EU suppliers. The authority will also have to safeguard the conditions for a long-term, stable energy market in Europe, and maintain links with Europe’s neighbours.
Despite the obstacles, EU Energy Commissioner Günther Oettinger is right to demand a rapid expansion of EU infrastructure. This is now urgent, with large-scale projects needed to improve energy trade within Europe and to generate new and reliable renewable sources. New pipelines and liquefied natural gas terminals will also have to be part of the mix in order to diversify Europe’s international energy suppliers.
All new projects designed to improve security of supply should be accelerated over the next 30 years. Within the EU expanded infrastructure will strengthen the single energy market and benefit from economies of scale, which will be especially important to make the new renewable sector competitive. On Europe’s periphery, there needs to be considerable expansion of non-EU infrastructure, with higher storage capacities for wind and hydro-power in Scandinavia, for example, and development of solar power in North Africa. Decentralised supply systems will also become increasingly important, especially for renewable energy. In future intelligent supply networks will optimise electric power transmission, and balance supply and demand more effectively.
None of this will happen, of course, without large-scale investment. Spending on infrastructure will reach €200bn in the next decade, and it is important that the money is spent quickly, because without an expanded central infrastructure Europe will fail to make the transition to a sustainable energy future.