The European Tribune is a forum for thoughtful dialogue of European and international issues. You are invited to post comments and your own articles.
Please REGISTER to post.
Energy investment needs 'strong regulatory push' Europe needs to invest hundreds of billions of euros in new energy networks and renewable energy production. Most of this money will have to come from "the market", but financial experts agree that, left to their own devices, banks and energy companies are neither able nor willing to do all that needs to be done. They say that a strong inflow from additional sources, such as dedicated investment funds and public institutions, will be indispensable. The European Commission has already started preparing a "tool box" that will contain "innovative market-based solutions" intended to seduce investors. But one private investor warns that if the EU is to achieve its ambitions with regard to climate and the internal market, the EU and member state governments will have to take a much more active role. 'A strong regulatory push is required'. (...) érôme Guillet, co-owner of Green Giraffe Energy Bankers (GGEB), a French-Dutch specialist advisory company focused on the renewable energy sector, sounded a slightly different note at the breakfast meeting. According to the Frenchman, who has been active in the financing of virtually all offshore wind projects in North West Europe to date, money as such is not the biggest problem for the renewable energy sector. The problem is that unlike gas-fired power plants, renewable energy projects require large upfront investments and therefore yield a lower initial rate of return. As financial markets are always looking for high initial rates of return, said Guillet, a purely market-based regulatory framework will always favour investment in gas-fired generation. `Gas-fired electricity is not necessarily cheaper', he said. `But since gas-fired power sets the price in the market and has low capital costs, it does tend be more profitable - and in a shorter time. Gas-fired power also provides more trading opportunities.' For this reason, he said, investments in renewable energy will require a strong `regulatory push' from the EU and Member State governments. `Nothing capital-intensive will get built without firm supporting policies', he said. `The key investment requirement is long-term price visibility - and this can only come from public decisions.'
Europe needs to invest hundreds of billions of euros in new energy networks and renewable energy production. Most of this money will have to come from "the market", but financial experts agree that, left to their own devices, banks and energy companies are neither able nor willing to do all that needs to be done. They say that a strong inflow from additional sources, such as dedicated investment funds and public institutions, will be indispensable. The European Commission has already started preparing a "tool box" that will contain "innovative market-based solutions" intended to seduce investors. But one private investor warns that if the EU is to achieve its ambitions with regard to climate and the internal market, the EU and member state governments will have to take a much more active role. 'A strong regulatory push is required'.
(...)
érôme Guillet, co-owner of Green Giraffe Energy Bankers (GGEB), a French-Dutch specialist advisory company focused on the renewable energy sector, sounded a slightly different note at the breakfast meeting. According to the Frenchman, who has been active in the financing of virtually all offshore wind projects in North West Europe to date, money as such is not the biggest problem for the renewable energy sector. The problem is that unlike gas-fired power plants, renewable energy projects require large upfront investments and therefore yield a lower initial rate of return.
As financial markets are always looking for high initial rates of return, said Guillet, a purely market-based regulatory framework will always favour investment in gas-fired generation. `Gas-fired electricity is not necessarily cheaper', he said. `But since gas-fired power sets the price in the market and has low capital costs, it does tend be more profitable - and in a shorter time. Gas-fired power also provides more trading opportunities.' For this reason, he said, investments in renewable energy will require a strong `regulatory push' from the EU and Member State governments. `Nothing capital-intensive will get built without firm supporting policies', he said. `The key investment requirement is long-term price visibility - and this can only come from public decisions.'
by Oui - Feb 4 30 comments
by Frank Schnittger - Feb 2 8 comments
by Frank Schnittger - Jan 26 3 comments
by Frank Schnittger - Jan 31 3 comments
by Frank Schnittger - Jan 22 3 comments
by Cat - Jan 25 61 comments
by Oui - Jan 9 21 comments
by gmoke - Jan 20
by Oui - Feb 430 comments
by Oui - Feb 311 comments
by Frank Schnittger - Feb 28 comments
by Oui - Feb 290 comments
by Oui - Feb 16 comments
by Frank Schnittger - Jan 313 comments
by gmoke - Jan 29
by Oui - Jan 2735 comments
by Frank Schnittger - Jan 263 comments
by Cat - Jan 2561 comments
by Frank Schnittger - Jan 223 comments
by Oui - Jan 2110 comments
by Oui - Jan 21
by Oui - Jan 20
by Oui - Jan 1841 comments
by Oui - Jan 1591 comments
by Oui - Jan 145 comments
by Frank Schnittger - Jan 1328 comments
by Oui - Jan 1222 comments