European Power Sector Faces Investment Boom
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LONDON, UK, May 13, 2002 - ICF Consulting's
European Wholesale Power Outlook predicts a
sharp reversal of the recent fall in power prices
around Europe. Prices are set to rise by an average
13 percent between 2002-2005 as power companies struggle
to comply with national and European Union greenhouse
gas emission targets.
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These targets, forcefully defended by the
Europeans during the Kyoto ratification process, require
a significant cut in greenhouse gas emissions to well below
1990 levels between 2008-2012. The power sector is a major
producer of carbon dioxide and will be expected to make
significant reductions to meet emission targets.
According to Simon Allen, President of ICF
Consulting Europe, "To meet emission targets will require
a massive investment in renewable forms of generation and
more efficient power stations. The bill for this investment
will be borne by electricity users. France, Germany, and
the United Kingdom can expect larger than average increases.
Our analysis indicates that 90,000 megawatts of renewable
capacity and 48,000 megawatts of new, gas-fired generation
is required by 2012 to meet European Union country commitments,
an investment of around €90 billion."
Neil Cornelius, ICF Managing Consultant added,
"With excess production capacity and generally low
prices, the European power sector seems an unlikely candidate
for a surge in investment. However, the strong desire of
the European Governments' to meet ambitious Kyoto emission
reduction targets will make the European Union a good investment
destination in contrast to current perceptions."
He added, "With the European Union planning
to start carbon emissions trading in 2005, the preparation
time for power companies is short; it takes two years to
build new gas-fired power stations and the process of getting
the required approvals adds significantly to the time lag
before new projects start operating. In fact, there is a
danger that a delay in defining the legislation for the
power sector in 2005 will make planning impossible and limit
the options available for reducing emissions, pushing the
cost of achieving the targets up even further."
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ICF International (Nasdaq: ICFI) partners with government and commercial clients to deliver consulting services and technology solutions in the energy, environment, transportation, social programs, defense, and homeland security markets. The firm combines passion for its work with industry expertise and innovative analytics to produce compelling results throughout the entire program life cycle, from analysis and design through implementation and improvement. Since 1969, ICF has been serving government at all levels, major corporations, and multilateral institutions. More than 1,800 employees serve these clients worldwide. ICF’s Web site is http://www.icfi.com.
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For Immediate Release
United Kingdom Contact: Kim Keats Martinez
Tel: 44 (0) 20.7092.3006
United States Contact: Douglas
Beck
Tel: 1.703.934.3820
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