The CEO of one of the world’s largest energy companies told that restoring energy prices to pre-Ukraine war levels “would take years.”
Enel’s Francesco Starace stated that new energy sources, including renewables and heat pumps, are necessary to reduce prices.
Governments around Europe invest billions to assist businesses and households in paying their energy costs.
Additionally, they are trying to acquire additional supplies.
This year, according to Mr. Starace, the corporation that produces and distributes electricity and gas attempted to shelter its twenty million European clients from energy market volatility.
He stated that the company did its utmost to adhere to the fixed-price contracts it had agreed to.
He stated that losing client trust would be more detrimental to the company than a one-year drop in profits.
The Italian energy giant sells electricity to over seventy million households and businesses in over thirty countries.
However, Enel intends to withdraw from several of these nations to focus on renewable energy and achieve carbon neutrality by 2040.
It also desires to reduce its enormous debts of over $63 billion (£52 billion).
It is spending considerably on solar panel production as it expands an existing factory in Sicily and constructs a new factory in the United States.
The greatest contributor to inflation and the cost of living crises in the United Kingdom, the United States, and the eurozone has been soaring energy prices.
Mr. Starace stated that the global energy crisis precipitated by Russia’s invasion of Ukraine “clearly demonstrated how perilous it is for Europe to rely on a single source of energy.”
According to him, the future will be “highly decarbonized” and reliant on nuclear and renewable energy.
However, the transition to renewable energy is not risk-free.
The International Energy Agency stated in July that China’s dominance in the production of solar and wind turbines poses “possible issues that nations must address.”
Mr. Starace stated that the West is overly dependent on China for renewable energy and other things.
When asked about global tensions interfering with energy supplies, he responded, “Some rebalancing is necessary because it is healthy.”
This has contributed to Enel’s investment in solar panels, but the expansion of Sicilian manufacturing will only cover 10% of Europe’s demand, he said.
Additionally, political leaders have agreed that Europe must obtain its energy from additional sources.
According to the European Council on Foreign Relations, this year the EU and its member states inked 56 energy agreements with 23 countries.
Among the most recent was a 15-year agreement with ConocoPhillips for Germany to obtain liquefied natural gas (LNG) from Qatar.
Norway is likewise increasing natural gas output, while the United States, the world’s largest producer, has been pumping record volumes.
According to Megan Richards, former director of energy strategy for the European Commission, this indicates the likelihood of Europe replicating its dependence on Russia with another country is “very low.”
“A lot of work has been done” to replace Russian energy, she said, adding, “I don’t believe Europe will be fully domestically independent for a very, very long time, if ever,” even though “renewables will expand substantially.”
