Ignacio Galán, the Chairman of Iberdrola and ScottishPower, has called for a pan-European energy regulator to be established to create an environment that can attract the major investment needed to deliver energy supply security and cut carbon emissions.
Speaking at Iberdrola’s annual general meeting in Bilbao, Galán also confirmed investments in wind power through its ScottishPower subsidiary under current regulatory conditions. “We will continue investing in wind energy projects, both onshore and offshore, for which there is a clear framework for installations that will begin operations up to 2017,” he said.
ScottishPower currently has approximately 1,420MW of onshore wind generation capacity in the UK, including the most recent project, the 136MW Harestanes windfarm in Dumfries and Galloway.
Galán said this will be increased further with the 389MW, £1.6 billion, off-shore West of Duddon Sands windfarm south west of Barrow in Furness, “which we expect to be fully operational this year.”
He said growth in the UK will come principally from investments in electricity networks which have a defined regulatory framework up to 2021 for transmission and to 2015 for distribution, with discussions under way for a new period up to 2023. In this regard, he highlighted the subsea HVDC cable connecting Scotland and Wales providing a 600,000 volt interconnection that will be the longest of its kind in the world.
He emphasised that the reason for this large difference in energy costs was due to the fact that in Europe energy bills have been used by governments as a catch-all for various costs unrelated to producing energy such as social, environmental and fiscal charges. In some EU countries these costs make up around 50% of bills, against less than 10% in the US.
However, at the same time around $2.6 trillion (€1.9 trillion) of new investment in energy infrastructure will be needed in Europe over the next 20 years, according to the International Energy Agency.
Galán said it was vital to create a single European regulator to promote a stable, predictable and coherent framework that could attract investment, ensuring compliance by all member states with established norms, at the same time as agreeing a common energy policy whose priority objective was to reconcile sustainability and competitiveness.