EU wants end to energy support measures by 2024
The European Commission wants all EU states to "wind down" energy support measures in force at present by the end of this year.
In its policy guidance issued today to member states, the commission said that it wants EU states to step up cuts to fossil fuel consumption.
And in the event of renewed energy price increases, the commission wants any new support measures after 2023 to be targeted at protecting vulnerable households and firms rather than wider support policies. Such measures should also be "fiscally affordable" as well as maintain incentives for energy savings, the commission said.
Despite recent steps to increase energy security, the commission sees no room for "complacency". The share of Russian pipeline imports in total EU gas imports dropped to 7pc in January, the commission said — having made up well over a third of Europe's supply in the years before 2022. But a potential complete halt to Russian gas supplies, infrastructure "incidents", droughts and unplanned power plant maintenance could create "concerns" for security of supply, it said.
The commission called for EU countries to focus on implementing climate and energy legislation to reach a 55pc reduction of greenhouse gases by 2030, most of which has been approved. Further efforts are needed in most areas, such as climate change adaptation and food systems, including soil preservation and other land use sectors, the commission said.
The commission also issued country-specific recommendations. For France, officials want accelerated deployment of renewables, focusing particularly on wind, solar and geothermal sources and biogas. Italy should increase internal gas transmission capacity to diversify energy imports, it said. And Germany must boost investment and deployment of renewables through improvements in administrative capacity and permitting. Poland should also accelerate legal reforms for grid connection permitting and renewables, including energy communities, biomethane and renewable hydrogen, according to the commission's recommendations.
Related news posts
APA defers FID for Australian gas pipeline's stage 3
APA defers FID for Australian gas pipeline's stage 3
Sydney, 13 May (Argus) — Australian pipeline operator APA has deferred a final investment decision (FID) for stage 3 of its planned east coast grid expansion, given potential rule changes for the South West Queensland pipeline (SWQP). APA is pushing back the FID by about 6-12 months to the first-half of 2025, and was likely initially planning to make the FID this year. The operator postponed the FID because of recent action by the Australian Energy Regulator (AER), which said it might recommend rule changes for the SWQP. A review was announced in February and is not expected to be completed until November at the earliest, APA said. The firm opposes any further regulation of the SWQP , maintaining that it does not return excessive profits. APA said the lack of a single arbitration case involving the facility since such a regime was instituted in 2017 is evidence that its customers accept present arrangements. "We've probably got around six to 12 months at the very most for us to work through and hopefully there's no change to regulation, but basically the time frame is we need to get started pretty much early next year on building stage 3," APA's chief executive Adam Watson said on 9 May. If the AER decides to make the lightly regulated SWQP subject to reference price regulation, an access arrangement would need to be determined which will take 2-3 years to complete, APA said. This means any changes would be instituted in the fiscal year to 30 June 2028. The SWQP can carry 440 TJ/d (11.75mn m³/d) in a westerly direction from Wallumbilla to the Moomba hub, from where gas can enter the APA-operated Moomba-Sydney and Epic Energy-owned Moomba-Adelaide pipelines for transport to southeastern facilities. Expanding the capacity of pipelines allowing the north-south transit of gas is considered critical to avoiding shortfalls owing to the depletion of Gippsland basin fields this decade. Stage 1 of APA's east coast grid expansion was completed in 2023, with stage 2 also now operational in line with guidance. These two stages increased capacity by 25pc, allowing about 50 TJ/d more gas to flow on the SWQP to southern markets, with similar increased volumes expected from stages 3 and 4. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Mexican power outages enter fourth day
Mexican power outages enter fourth day
Mexico City, 10 May (Argus) — Mexican power grid operator Cenace issued its fourth consecutive day of operating alerts amid the heatwave gripping the country. Net electricity demand reached 47,321MW early today, with deployed electricity capacity slightly below at 47,233 MW, according to Cenace. Since 7 May, Cenace has declared emergency operating alerts as demand exceeded generation capacity during peak evening hours, prompting the grid operator to preemptively cut electricity supply across different states to maintain grid integrity. Power outages have lasted up to several hours in Mexico City and in major industrial states as power demand has outstripped supply by up to 1,000MW. Peak demand this week hit 49,000MW, just below last year's historic peak of 53,000MW during atypical temperatures in June. "We are very concerned about the unprecedented outages detected across 21 states, a situation that affects the normal functioning of Mexican companies," national business chamber Coparmex said. Peak electricity demand typically rises in June-July but temperatures this week have risen as high as 48°C (118° F) across some states. Mexico City reported a record high of 34.3°C on 9 May and high temperatures are forecast to continue into next week, Mexico's national weather service said. The inability of Mexico's grid to respond to increased demand is because of insufficient power generation capacity, non-profit think-tank the Mexican institute for competitiveness (Imco) said this week. "Despite the energy ministry's forecast that 22,000MW of new power capacity would enter service by 2026, only 1,483MW had entered service as of 2022" since late 2018, Imco said. President Andres Manuel Lopez Obrador's administration pledged to build new generation capacity, including five gas-fired, combined-cycle plants, but recognized this week that delays had contributed to the power outages. "We have an electricity generation deficit because some of the combined-cycle plants were delayed, but we are working on it and it will soon be resolved," Lopez Obrador said on 9 May. Lopez Obrador's government has also curtailed private sector power development during his administration. Mexico needs to upgrade and expand its transmission network, industry associations say. "In order to resolve this problem, we believe that a reopening of the electricity market to the private sector is imperative," Mexico's wind energy association, Amdee, said. Mexico has 87,130MW of installed capacity, with 39.5pc from combined-cycle gas-fired power plants and 31pc in renewable power, including wind, solar, hydroelectric, geothermal and biomass, according to the latest statistics from the energy ministry. By Rebecca Conan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Petrobras to expand free gas market footprint
Petrobras to expand free gas market footprint
Rio de Janeiro, 10 May (Argus) — Petrobras said today it will offer new types of natural gas contracts in Brazil's open market with more flexibile and competitive terms, but provided no details on the planned offers. The company also announced new commercial contract models for gas sales to state distributors, offering price reductions for current contracts of up to 10pc. The reduction will be connected to the distributors performance, Petrobras said, without providing more detail. The move by the state-controlled giant is significant given the 2021 gas market liberalization as aimed at increasing competition at every step of the value chain beyond just Petrobras. But progress has been slow in cutting Petrobras' market share, lowering prices, and increasing market transparency. The 2021 gas law covers the full lifecycle of natural gas, from production to transportation, processing to storage, and sales. A key provision aimed at promoting competition in the upstream, midstream, and downstream sectors, particularly transportation and distribution. Yet, three years later, there is little sign of downstream customers migrating to the free market, despite some moves such as those from Delta Geração, Acelen, Gerdau, Tradener, and others. The number of free market commercial contracts does not exceed ten, according to a lawyer specialized in the energy market. By Betina Moura Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Floods stress Brazil energy sector vulnerability
Floods stress Brazil energy sector vulnerability
New York, 10 May (Argus) — Record flooding in Brazil's Rio Grande do Sul state over the past week underscores vulnerabilities in the country's energy system to extreme weather, which could also slow its pace of transition to cleaner energies. Nearly one week after record rainfall began flooding the state, power outages continue to plague it, with nearly 400,000 residents still in the dark. The flooding forced companies to suspend operations of critical infrastructure for the power sector, including three substations, 25 transmission lines, six hydroelectric plants and 11 power transformers. This led grid operator ONS to import power from Uruguay to meet domestic demand. With forecasts pointing to more rain, it is increasingly clear that it will take weeks if not months for the state to start returning to normal. The Rio Grande do Sul government estimates that the floods will cost the state R19bn ($3.6bn) . The tragedy in southern Brazil comes less than a year after a record drought struck the Amazon basin, which pushed water levels of the Amazon River and its tributaries to their lowest in 120 years. The drought reduced hydroelectric output from the region's plants and interrupted transport of fuel along key river corridors, leaving many households without power, because of the lack of diesel to operate generators used in off-grid communities. These crises highlight the country's failure to prepare for extreme weather and underscore the lack of investment in critical infrastructure, including in the energy sector. A study by the World Bank from 2023warned of the need to upgrade the country's aging infrastructure and of future power supply risks. Brazil's large hydroelectric plants have been operating for an average of 55 years, according to the study, and need investments to boost efficiency and to limit the impact of extreme weather. A total of 11 hydroelectric plants in Rio Grande do Sul are being monitored, including six that present an elevated risk of rupture, such as the 28MW 14 de Julho plant that experienced a partial rupture last week because of the heavy rains. Authorities will now need to change their focus, which has been largely on limiting the impact of dry weather on the electricity sector, especially following the 2021 droughts, that resulted in expansion of thermoelectric generation. More recently, electricity regulator Aneel has been focusing on making power distribution and transmission networks more resilient to extreme weather, especially after downed power lines resulted in extended blackouts for some 4mn consumers in the city of Sao Paulo and over 1.3mn consumers in Rio de Janeiro. The sector is working to make transmission towers more resilient to high winds. Several cities and states in Brazil have launched plans to prepare for climate change, but the bulk of these plans focus on increasing investments in renewable energy and emissions reduction. Increasingly, these plans will also need to focus on mitigating risk from floods, heat waves and landslides. Brazilian energy companies are also behind the curve in their preparations for climate change. Only 13pc of executives in the energy sector that participated in a recent survey conducted by consulting firm PwC Brasil said they have assessed the impact of climate change on their financial planning. State of climate Brazil faced 12 extreme climate events in 2023, according to the World Meteorological Association (WMO). This included a tropical cyclone that hit Rio Grande do Sul last year and affected more than 340,000 people and left nearly 50 dead. The WMO blamed the extreme climate events in Brazil on the "double-whammy of El Niño and longer-term climate change." Last year, eight Brazilian states recorded their lowest July-to-September rainfall in over 40 years, it said. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more