Volatile energy regulations may deter investors from providing an estimated 1 trillion euros ($1.3 trillion) required in the power industry by 2020, according to European Union energy associations.
The missing investment will put future power generation at risk, electricity industry group Eurelectric said today in an e-mailed statement.
“Changing regulation decreases the attractiveness of utilities,” said Hans ten Berge, secretary-general of Eurelectric. “This deters investment and leads to yet more volatile regulation.”
The EU aims to reduce the impact of climate change by 2020 by setting targets for reductions in greenhouse gas emissions and increases in energy efficiency and the amount of energy produced from renewable sources. Inherent tensions between those goals and changes in their relative importance at the EU and national levels is increasing risk for investors, according to Eurelectric.
There is “no interrelation” between the EU emissions trading system and renewables targets, Eurelectric said. “Volatile national policies create uncertainty and undermine the viability of conventional generation.”