More than 100 electric utility companies and consultancies in Europe identified regulatory risk and weak wholesale power prices as the greatest challenges facing the industry, according to a recent survey conducted by Platts, a global energy information provider.
Insufficient network development and fuel price risk were also noted as need-to-resolve challenges to the electric utility companies.
“The survey reveals a wide spectrum of opinion in a sector struggling on several fronts,” said Henry Edwardes-Evans, editor, Platts Power in Europe. “Some respondents believe the industry is adequately equipped to meet power needs, while others believe West Europe is heading for a perfect storm driven by ageing infrastructure, supply volatility of renewables and accelerated nuclear closures.”
Nearly half of those surveyed said that new conventional power plants are needed in the next three years, particularly in the U.K., Germany and Belgium. Respondents also called for new power plants to be built in France within the next five years and in Italy, Ireland and Switzerland within the next 10 years.
“When we asked how these plants might be financed, most of those surveyed thought some form of central, regulated support would be needed,” said Edwardes-Evans. “Hardly anyone thought wholesale markets alone would provide sufficient revenue for the infrastructure build.”