Fossil fuel subsidies exceed amount for renewables in 2019, EC report shows

Greece spent one percent of GDP on fossil fuel subsidies in 2019, exceeding the 0.9 percent level allotted for renewable energy subsidies, a European Commission report published yesterday has shown.

However, fossil fuel subsidies in Greece are on a downward trajectory whereas subsidies for the RES sector and energy efficiency are steadily rising, the report added.

Of 1.6 billion euros made available for fossil fuel subsidies in 2019, the biggest percentage concerned diesel and petroleum products, the remainder going to the natural gas and lignite sectors.

Energy source subsidies in the EU totaled 176 billion euros in 2019, up 8 percent from 2015, the report noted.

Subsidies for energy efficiency increased during this period by 43 percent to 5 billion euros while subsidies for energy production increased by just 4 percent to 3 billion euros, primarily for renewables, the Brussels report showed.

 

 

 

SEEPE: Energy transition cost significant for petroleum sector

The energy transition is being made at a high cost for the European market as well as market distortion dangers that need to be addressed, officials of SEEPE, the Hellenic Petroleum Marketing Companies Association, have stressed at a news conference.

It is extremely crucial that government policy packages do not allow for exclusions, while also paying attention to the petroleum sector’s sustainability, aligned with the idea of a truly fair and smooth transition, SEEPE officials pointed out.

Close coordination is needed, even internationally, as climate change is a global problem, the association noted, adding that the European market cannot bear the cost of the green transition without significant support in a globally competitive environment.

The petroleum sector will face challenges as a result of the gradual reduction in the number of fuel-powered vehicles by 2035, given the European Commission’s climate change objectives, SEEPE officials noted.

Despite the energy transition challenges, Greek petroleum companies are embracing the energy transition towards carbon neutrality, they added.

Investments will be needed while the petroleum sector’s new commercial strategy, to enable a transition from conventional fossil fuels to eco-friendly fuels, is vital, the SEEPE officials stressed.

Brussels fears electricity prices could reignite Euroscepticism

The European Commission is pressing for an antidote to counter the sharp rise in electricity prices around Europe, fearing a prolonged period of escalated prices could spark a new wave of Euroscepticism that would put EU citizens at odds with the continent’s energy transition plan, a key Brussels climate-action strategy.

Allegations of market manipulation and doubled CO2 emission right prices since the beginning of the year, at 59.43 euros per ton yesterday, have reinforced the overall reaction against the EU’s energy policy, placing governments under pressure and fueling unrest.

With fears growing of a resurgence in France’s yellow vest movement, the European Commission is seeking to convince citizens that the Emissions Trading System (ETS), a cornerstone of the EU’s green-energy transition policy, is not the cause of the electricity price rises, instead laying the blame on natural gas and fossil fuels.

European Commission president Ursula von der Leyen, in her State of the Union Address, delivered yesterday, was clearly distressed by the situation, offering strong support for the European Green Deal. But, judging by the overall response, she has not appeased the concerns about rising energy prices.

The president’s thinking was reiterated by her deputy Frans Timmermans, in charge of the European Commission’s climate action portfolio, according to whom, only one-fifth of the electricity price increases can be attributed to the elevated CO2 emission rights prices.

 

 

EU’s ‘Fit for 55’ package to spike heating, auto fuel costs

The EU’s new, more ambitious climate-change package, “Fit for 55”, aiming for a 55 percent reduction of carbon emissions by 2030, compared to 1990 levels, will prompt sharp price increases in diesel heating fuel costs as well as fossil-fuel powered transportation.

The prospective package, announced yesterday in the form of twelve legislative proposals, has already raised the question as to who will cover its cost – consumers, producers, or both.

The package will lead to wider implementation of the ETS for buildings and transportation.

Inevitably, less affluent households and smaller enterprises whose heating and transporation needs are exclusively covered by fossil fuels will face even greater pressure.

The European Commission has proposed a 61 percent reduction of carbon emissions from sectors covered in the EU’s existing Emissions Trading System (ETS), compared to 2005 levels, up from the previous target of 43 percent.

PPC turn to renewable energy backed by BNEF report findings

Wind and solar energy production costs will be lower than those of existing natural gas-fueled power stations by 2025, according to a BloombergNEF analysis on Greece’s electricity market.

The projection vindicates the power utility PPC’s decision to turn to renewable energy, the corporation’s head has indicated.

“The conclusions of the BNEF report are in full agreement with the key pillars of our new strategy,” PPC’s chief executive Giorgos Stassis said.

Installed wind and solar energy capacity will have quadrupled by 2025 compared to present levels, and renewable energy sources will have captured an energy mix share of nearly 50 percent, toppling fossil fuel from its dominant position, even if RES subsidies are not offered for existing technologies such as solar and wind, according to the BNEF analysis.

“The ever-increasing competitiveness of renewable energy sources also confirms, from an economic point of view, our choice to restructure our portfolio and transition our production towards renewable energy sources,” Stassis noted. “By focusing on clean energy, we can achieve a decarbonization of our activities in electricity generation and also reduce the cost of electricity for consumers.”

In addition, the report highlights the important role of consumers as key players in the future energy system, the PPC chief noted.

This supports PPC’s decision to develop a new customer-oriented approach and offer a reinforced portfolio of products and services, using new technologies and digital systems, according to Stassis.

Utilizing lower generation costs offered by wind and solar energy production, PPC will be well positioned for leading roles in other energy sectors, beginning with electromobility, the PPC head supported.

According to the BNEF report, Greece can establish itself as one of the EU’s energy transition leaders.

Lower-cost solar and wind energy production, as well as storage systems, plus increased CO2 emission right costs, are all radically transforming the country’s energy system, the BNEF report noted.

Greece is expected to gain an additional 18 GW in generation capacity by 2030, 67 percent of this increased output represented by wind and solar energy.

RES generation in EU captures record share of energy mix

Renewable energy generation captured a record-high 35 percent share of the EU’s energy mix in the fourth quarter of 2019, up from 31 percent a year earlier, primarily as a result of record generation levels registered by the hydropower and wind energy sectors, latest European Commission data has shown.

Hydropower production rose significantly, by over 16 TWh year to year, while major gains were achieved by the wind energy sector, whose onshore wind farms grew by 9 TWh, or 9 percent year to year, and offshore wind farms registered a record year-to-year increase of 3.3 TWh, 18 percent.

Overall RES generation in December totaled 105 TWh, a new record level for the month, as a result of favorable conditions for wind farms and record hydropower production levels.

On the contrary, the energy mix share of fossil fuel fell to 39 percent in the fourth quarter of 2019, down from 42 percent a year earlier.

Greenhouse gas emissions in EU electricity generation fell by approximately 12 percent in 2019 as a result of the increase in RES production and a turn from coal to gas.

CO2 emission right costs increased by 57 percent year to year, to 25 euros per ton, according to the European Commission data.