Study: Government-owned power stations undermining EU’s low-carbon transition

Poland is the largest single emitter in the EU.

This is according to a report from GRESB, titled “Power Players: Ultimate Ownership, Emissions, and Slow Progress in the EU’s Power Sector from 2024 to 2030”. The scope of the analysis includes power plants located within the EU (the Eurozone plus Bulgaria, Czechia, Hungary, Poland, Romania, Sweden and Denmark).

The report highlights that a substantial share of the largest power-generating entities in the EU are ultimately owned by national and local governments, who are not transitioning away from fossil fuels quickly enough.

According to the analysis, the EU power sector is heavily concentrated, with 20 companies responsible for nearly 40% of the sector’s total emissions. Nearly 88% of power generation from these companies is attributable to governments, with national governments accounting for 85% and local governments for 3%.

Additionally, the report highlights disparity in the energy mix among different countries’ government-owned power generation portfolios within the EU.

Non-hydro renewable energy – mainly solar and wind – accounts for a major energy portfolio share of Sweden (17%), Denmark (77%)and Ireland (21%).

In contrast, coal and gas dominate the portfolios of Poland (89%), Germany (90%) and Ireland (70%), making Poland the largest single emitter in the EU with 48.6 MtCO2e in 2024.

The report emphasises that although the sector is moving towards clean energy, the transition is happening at a slower pace than necessary, with many private firms moving more rapidly than government-owned ones.

Research findings show that the EU’s total power generation sector emissions are projected to decline by one-third between 2024 and 2030, with coal usage dropping by 60% and renewable energy generation expected to double.

However, based on actual capital expenditure plans rather than stated targets, the EU will still use coal and gas to supply 5% and 25% of its electricity, respectively, in 2030.

GRESB’s research director for asset impact Alex Clark said: “To stay on track with the International Energy Agency’s net-zero by 2050 scenario, total emissions in the EU need to decline more than twice as fast as they currently are over the next six years and coal needs to be completely phased out.”

The report suggests that governments need to apply more direct pressure on the power companies they control to align with the EU’s climate goals and the International Energy Agency (IEA)’s Net Zero by 2050 scenario.

The report comes shortly after the EU agreed to exit the Energy Charter Treaty late last week– a move which several member states had already made on climate grounds. The Treaty was launched in the 1990s and provides a legal framework for international energy infrastructure financing. It also enables member nations to take legal action against one another for failing to pursue shared energy objectives.

Critics of the Treaty argue that it continues to prioritise fossil fuel finance and enables nations to be penalised for making a swift clean energy transition. The UK withdrew from the Treaty earlier this year.

Related article: IEA Pathway to Net-Zero by 2050: Conclusion and Updated Targets

Related article: Accelerate and Expand: EU Must Take Key Actions for a Rapid Transition to Clean Energy

Comments (1)

  1. Richard Phillips says:

    Non-hydro renewable energy – mainly solar and wind……
    This is all unreliable energy, sometimes a surfeit, sometimes dearth.
    What is needed is a totally reliable energy source or sources.
    In the non-carbon world, this means fission or fusion.
    There is no escape.
    But decisions are made by politicians who are mainly non-technical, and may be resistant to the admission that they may need education in this sector.

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