The Parliament: Europe must invest in energy security
Late last year, as events unfolded in Ukraine, the security of Europe's energy supply made its way back to the heart of the political debate. This has been further reinforced in recent months, with a growing recognition that, in the current weak macroeconomic climate across much of Europe, it is necessary to bolster investment in core infrastructure. Commission president Jean-Claude Juncker's investment plan, if agreed, is likely to target investments in European gas and electricity networks.
This renewed political attention on investment in Europe's energy network should be welcomed. But can the projects be delivered in a reasonable timeframe? There are at least two grounds for broad optimism. At European level, solid progress has been made over the last few years to identify investment needs. A comprehensive pipeline of 248(PCI) required by 2020 has been agreed with member states. Moreover, although many of these projects are undeniably complex to deliver, the technologies involved are broadly mature, the risks are well understood and the standard financing models are, in principle, well known by financial markets. This bodes well. Nevertheless, challenges remain for many proposed projects to overcome regulatory, financial and technical barriers. We offer the following four points within this debate.
"Given the macroeconomic position of Europe, it is critical to select projects which bring real economic net benefits"