Copublished with Beyond Fossil Fuels
BERLIN, 26 JUNE 2024 – A new report assessing the transition plans of five European power utilities reveals that none include the critical commitment to phase out fossil gas power by 2035, as recommended by the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC) [1].
The new report “Power Moves and Power Failures,” produced within the Beyond Fossil Fuels coalition, assesses the plans of Enel, ENGIE, EPH, Iberdrola and Statkraft, and reveals a promising increase in investments in renewable energy [2]. However, three of these companies, Enel, ENGIE and EPH, remain significant developers of fossil gas-fired power plants, undermining the transition to a renewables-based power sector in Europe and pursuing strategies that would lock them and the countries in which they operate into burning more gas.
EPH, Enel, and ENGIE’s so-called transition plans fail to deliver a transition away from fossil fuels, and as such, make as much sense as driving a car with the handbrake on. Their commitment to developing new gas-fired power plants will lock in future emissions and hinder Europe’s ability to meet its climate goals. They will also leave their financial backers at risk of not meeting net zero commitments. Iberdrola and Statkraft show that transition plans largely focused on readily-available and easily-deployable wind, solar, storage, and grid solutions are feasible. Financial institutions must push power companies to adopt genuine transition plans and support the decarbonisation of the power sector.
Pierre-Alain Sebrecht of Reclaim Finance.
Currently, banks, investors, and rating agencies lack effective methods to consistently evaluate utilities’ energy transition plans, making it difficult for them to draw meaningful comparisons and ensure their support is only directed to those companies whose plans align with climate science. The report is the first in a series that will offer financial institutions a replicable framework to accurately evaluate the transition plans of power utilities and make informed, sustainable investment decisions.
The financing decisions being made today will determine how successful Europe will be at decarbonising its power sector by 2035. We are presenting a new tool to assess utility plans, so that financial actors can engage with their power utility clients to make a genuine contribution to the transition to a fossil-free, renewables-based power sector by 2035.
Brigitte Alarcon, campaigner at Beyond Fossil Fuels.
