The European Union will still experience higher power prices than the US and China, even under its best-case net zero scenario, due to growing demand and inherent disadvantages, the bloc’s business lobby said on Thursday.
A study commissioned by Business Europe indicated that the EU’s electricity generation costs will remain at least 50% higher than those in the US and China through to 2050 under a “managed scenario,” where climate goals are met without significant setbacks. A “frustrated transition,” in which key policies face delays beyond mid-century, could see costs rise to as much as three times higher than those of its main rivals.
“This will put European companies at a serious competitive disadvantage with these key competitors, which is why we need urgent action at EU level,” said Markus Beyrer, director general for Business Europe. “Securing energy at competitive prices will be central to preserving Europe’s industrial base.”
Reducing energy costs is a top priority for the heads of major industrial companies in Europe. Policymakers have made competitiveness in renewable energy sources a cornerstone for the next European Commission, but companies report being overwhelmed by bureaucracy.
The EU pays significantly more for its energy due to its reliance on imports, a situation worsened by Russia’s invasion of Ukraine and reduced gas supplies from Moscow.
