Maintaining a resilient energy system for a climate neutral and competitive economy: Regional insights for EU-wide strategies

Tsvetelina Penkova MEP, EEF President opened the discussion by expressing that we need predictability of EU regulatory framework. Balancing climate goal with energy competitiveness is no easy task. The diversity of Europe is a strength, and she stressed the importance of regional insight. By bringing these regional perspectives together we can build the foundation of climate neutrality while remaining competitive. She said that we need a diversified energy mix: We should invest in baseload renewable and innovative storage solutions ; we should encourage cross border cooperation and use digital technologies that are game changer for resilience, effectiveness and flexibility.

Małgosia Rybak, Climate Change & Energy Director at CEPI, the confederation of pulp and paper industry explained how their industry, that has 900 mills in Europe is transforming from everyday lives products to alternative products including biobased ones. She showcased decarbonization examples in different factories that are situated outside cities/in rural areas: some replace natural gas by biogas produced onsite; another increases the availability of green electricity in the grid with a combination of CHP and e- boilers; another uses 100% green electricity. She explained that in the case of CEPI, onsite energy changes can be made both in terms of molecules and electricity and that their examples and expertise can serve and facilitate the transition in other places in Europe.

Werner Götz, CEO of TransnetBW introduced his company, one of Germany’s Transmission System Operators . It has to provide a reliable source of energy to the region of Baden Württemberg that is one of the strongest industrial cluster in Germany, is highly populated and has very variable landscapes. They face challenges such as public acceptance, environmental constraints and replacing energy generation. As he gave concrete examples, he explained that we need to look at energy transition from industrial and economic point of view. We need back up capacity at the right place and ready by 2030 in order to support grid stability needs. It is necessary to focus on the essential to reduce the cost and to provide a stable market and framework for investments to take place. Affordability is key and bureaucracy should be reduced.

Andreas Guth, Secretary General, Eurogas explained that the success of energy transition relies on achieving the right balance between security of supply, affordability and sustainability. Eurogas tried to look at the role different gases (natural gas, biomethane, Hydrogen, low carbon and renewable gases) can play in achieving this balance. The role of molecules in our energy system towards 2050 in all scenarios but one increase in relative share and in absolute term. We will have more gases in the system in 2050. Even in the high electrification scenario, we will still have 85% of the gases we use today in terms of final energy consumption. In case of excess generation from renewable, electrolysers are fundamental. He continued explaining why gases are essential in our energy system. High availability of renewable will achieve electricity price reduction. Although natural gas consumption will decline drastically in final energy demand, it will remain an important source of primary energy demand because we still need it for producing hydrogen. He added that we need to diversify the energy mix, by investing in domestic resources such as biomethane – which is a no regret option – but also in natural gas and concluded that all different gases are essential for that balance between security of supply, affordability and sustainability

During the Q&A session, both MEPs and industry representatives had the opportunity to share their point of view and ask questions on issues relating to energy intensive industries’ dependence on the price of electricity, storage options, carbon capture and storage development, loss of efficiency during energy transformation or intermittent energy sources. Reflexions also mentioned the potential need for another reform of the Electricity market in Europe, grids for hydrogen as well as flexibility and energy efficiency. Biomethane was also discussed along with the 35000 bcm target and guarantee of origin.