Enough power stations? Don’t leave it to the market
“If individual member states continue to implement their own subsidies and other aspects on the energy market separately, it will be extremely expensive,” said Maroš Šefčovič, the Vice President of the European Commission with responsibility for the Energy Union, during his recent visit to Prague.
In short, what Šefčovič learned in Prague from representatives of businesses and the government was that the EC’s plan is a good one – but no-one is interested in implementing it. Energy companies in Western Europe are demanding the creation of capacity markets that would serve as a source of income for lossmaking traditional power generation stations that serve as a backup at times of insufficient output being sourced from renewable power sources.
“The electricity market alone cannot guarantee reliability in power supply, in other words the existence of sufficient backup capacities,” said Martin Herrmann, CEO of RWE East, in sentiments echoed by several others, including Simone Mori, Executive Vice President of Italy’s Enel. The difference between RWE and Enel lies in the fact that RWE can hardly expect any payment for backup capacities in Germany since the country’s government has abandoned that approach, while Italy is preparing a tender that aims to ensure the preservation of backup power stations within the grid.