EU chief praises power industry as sector calls for fair price

European power plant suppliers were praised for their efforts in aligning with EU ambitions for a cleaner energy sector at the EPPSA’S annual conference in Brussels on Monday evening.

However the main representative body for the sector continued to call for a fair price for its stabilising services in order to effectively continue what it sees as its new role in facilitating more renewable energy on to the EU’s electricity system.
Dominique Ristori
Dominique Ristori, the European Commission’s director general for energy praised the “impressive commitment of the European Power Plant Suppliers Association in actively contributing to a successful energy transition in the European electricity market.”

“Energy is key in implementing the Paris Agreement and is also increasingly a strategic factor. We need an increasing dialogue with all key actors as it will be crucial to base our work on a clear understanding of key priorities.”

Ristori told the audience of power professionals at Residence Palace that so far gains had been made in reducing emissions due to a combination of clean energy and energy efficiency regulation.

“Our power plant suppliers are crucial to progressing a new, more efficient, European energy market. The sector will become more important as we see potential for new markets, in particular with the transport sector and the more rapid development than expected of electric vehicles, particularly in the cities as well as the digitisation of energy systems.”

“It will be essential to put the customer at the centre of the scene, in the context of a more decentralised energy system.”

CALL FOR INNOVATION

Much of Ristori’s speech was dedicated to urging suppliers to continue to facilitate the penetration of innovative new technologies. Another clue as to where the Commission eventually plans to put its resources, saw emphasis on the need for more research and development in the power industry.

Reading between the lines, Brussels may have an enormous amount to invest in the new clean energy revolution but wants industry actors to put their hands up in terms of coming up with the innovations required to accelerate the transition.

Earlier Professor Emmanouil Kakaras, president of EPPSA, as well as head of research at Mitsubishi Hitachi Power Systems cautioned against a ‘flick of the switch’ transition to a new look energy market.

“Our sector is greener than ever and this will continue for years to come. But it has to be done under affordable conditions as the energy we supply ensures security of the system. We are adapting a system that’s been there for 100 years so it should be an evolutionary approach rather than a switch for Europe.”

Kakaras’ key message on behalf of EPPSA members was that their role in providing a ‘secure energy system for EU citizens in the new market playground….should be rewarded with a proper price.’

At a time when conventional plants are being consigned to unprofitability due to market conditions and the influx of the renewable energy fossil plants are facilitating, Kakaras was keen to impress on policymakers in attendance that they should return the favour in helping plant owners continue to play its part in the transition.

“Thermal power is an enabler to allow the integration of more renewables on the grid and contributes to EU competitiveness through affordability of energy prices.”

“Thermal power will continue to embrace new technologies in years to come. Already we see recently the game changer in terms of CO2 abatement through centralised carbon capture, utilisation and storage technology. We are engaged in an industrial symbiosis with fuel transport, energy and heat sectors.”

Kakaras welcomed the recently announced European Commission’s energy package and said he looked forward to the new investment ‘which has vanished from the picture in the last year due to the insecurity of the political environment,’ before adding his members’ desire was to see a fair technology neutral, level playing field for all technologies that are able to contribute to the energy transition.

“We would welcomes rationalisation of subsides and (preference for) market-oriented solutions.’

EVOLUTION OR REVOLUTION?

Incidentally in a later panel discussion Douglas Spalding, head of planning at Doosan didn’t entirely agree on the notion of how quickly the new market could be developed.

“We think some parts of the EU are ready for a revolutionary switch. When you think of grids and technologies in other parts of Europe it will be more of an evolutionary transition but we think, to deliver the energy transition, thermal power must be agile. Fossil will ultimately be a thing of the past, and as soon as possible we are keen to see this evolutionary path supported by R&D so we make it happen as quickly as possible.”

Ristori said there will be regular progress analysis of the development of the new system with reports in March, June and November to establish how successful or unsuccessful implementation will turn out to be.

This would also serve to maintain a global and consistent approach for all actors.

The director general acknowledged the importance of EPPSAs members in facilitating the success of the system.

“70 per cent of new capacity in the electricity sector is dedicated to renewables and it is crucial to organise new rules in order to have this market ready for managing reliability.”

“It’s is crystal clear when you have 20 per cent of electricity provided by renewables and 50 per cent by 2050 it will become more difficult to anticipate the level of production so the management of reliability will be very important.”

Before returning to the theme of what he referred to as ‘the fifth dimension’, R&D , Ristori again delivered the Commission’s message of regional co-operation rather than member states alone being the answer to effective grid management.

But it was research and development that formed a substantial extent of his speech, and specifically what possibilities could emerge from a concerted effort in the area of storage development.

“It would be impossible to progress without the fifth dimension and we support that in the package in order to accelerate key responsibilities.”

“I speak of the challenge of modernisation of storage; innovation here would be supported as part of progressive decarbonisation of the wider energy system in order to support the more efficient integration of renewables. It can be an indispensable instrument and I would like to invite all key actors- and consistent support from the private sector and those in charge of research for this task."

“You can count on our encouragement to facilitate this approach- I mention the priority work between negotiators at EU level but also research from TSOs, DSOs, suppliers, consumers and regulator to do exactly the same in a coherent  way –we can’t do it in isolation and I am pleased with the quality of dialogue between the EPPSA and the Commission.”

“These challenges aren’t easy but if successful it will be extremely profitable for Europe, with many macroeconomic advantages, and profitability for Europe’s people, in terms of quality services, ability to manage electrical bills , mange the city environment, quality of air, diminishing noises, all of these things are extremely important affecting an impact on economies and individual lives.”

THE NGO PERSPECTIVE

European Environmental Bureau Policy Manager Christian Schaible was the non-governmental organisation (NGO) presence on the evening and he had mixed news for fossil fuel power agents in terms of how environmental legislation is likely to affect their enterprises.

He ruled out the prospects of a future for coal power on the continent based on best available technologies and the punitive costs of retrofitting facilities to state-of-the-art standards. He also pointed out the 'hidden externalised cost of air pollution' associated with coal.

"Annual health costs would still be EUR3.7bn a year with 2,500 premature deaths a year – I can re-assure you that NGOs will highlight this more and more and there is unlikely to be a future for coal past 2030 in our outlook. Phase-outs as seen in the UK and Portugal will be the common pattern for the market."

Schaible said prospects were better for gas utility operators, pointing to the potential for a 'meaningful European Emissions Trading System'. He also mentioned the strides in efficiency and abatement made by Siemens in their CCGT technology, particularly evidenced at the Fortuna plant in Dusseldorf.









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