EWEA Expects Eur140 Billion in EU Power Grid Spend

The European Wind Energy Association expects the European Commission to estimate Wednesday that the EU needs to spend Eur140 billion ($192 billion) on power infrastructure in the next 10 years, EWEA press officer Peter Sennekamp said Monday.

The EC said in its 2020 energy strategy unveiled on November 10 that the EU would need to spend Eur1 trillion on energy infrastructure to 2020 to meetthe its energy policy aims.

The EC is expected to give more details in its paper on EU energy infrastructure due to be unveiled on Wednesday, and has been consulting widely with stakeholders such as EWEA, which represents the EU’s wind industry.

“We understand that the EC will say that around Eur70 billion will be needed for transmission infrastructure, including about Eur30 billion for interconnectors,” said Sennekamp.

The EC is expected to say that another Eur30 billion would be needed for offshore grids and Eur40 billion for smart grids and distribution networks.

“We expect the EC to say that building the offshore grid will be 20% more expensive if it is not coordinated at EU level,” said Sennekamp.

EWEA WANTS EU APPROACH TO REGULATED RATES OF RETURN

Some Eur90 billion of the total Eur140 billion would be for commercially viable investments and met by private funding, while the remaining Eur50 billion would need public funding, EWEA understands.

“We want to see infrastructure treated as a public good in a regulated market,” said EWEA’s CEO Christian Kjaer.

The EC should not dictate who invests, said Kjaer, but he added that he wants to see an EU approach to setting the regulated rates of return for strategic EU projects that reflects the risk involved. He said the EC should tackle this issue in its legislative proposals to promote investment in EU energy infrastructure expected next year.

Kjaer backed the EC’s idea in its 2020 strategy to have time limits for the permitting process for strategic EU projects. “There needs to be a deadline for permitting if there is EU money involved,” he said.

The EU’s push to further separate grids from parent energy companies in its 2009 third energy package would free up grid operators to invest more independently, said Kjaer.

But getting the public to accept big energy infrastructure projects is still difficult.

“It’s important for the EC and the sector to explain the benefits — such as reduced dependency on imported energy — more clearly,” said Kjaer.

[mappress]

Source: platts, November 16, 2010;

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