Energy will undoubtedly remain the priority of the new European Commission. The Old Continent is seeing its competitiveness falter and is still suffering the collateral effects of the war in Ukraine. In this bleak picture, it is still possible to succeed in the energy transition, assures Catherine MacGregor, general director of Engie. Certainly, the path is strewn with pitfalls and the future Trump administration adds a dose of uncertainty. But Europe has the means to develop its independence, thanks in particular to electricity storage and renewable energies, assures the one who has held the helm, since 2021, of the French energy giant. Interview.
L’Express: The European Union renews its Commission. At the same time, the United States inherits a less cooperative president. In this changing world, will Europe be able to do well while succeeding in its energy transition?
Catherine MacGregor: Europe is facing its responsibilities! Its energy sovereignty is a more crucial issue than ever. We had somewhat forgotten him over the last eighteen months. Russian gas has been replaced by LNG from other countries, but we must be careful not to create new dependencies. Accelerating the energy transition towards renewable energy, produced in France and Europe, will help avoid this trap.
When it comes to the environment, Europe does not necessarily need to set tougher or more restrictive objectives: we already have an ambitious roadmap, let’s implement it! Our energy transition scenario for Europe shows this: the targets for reducing greenhouse gas emissions in 2030 are within our reach. Achieving carbon neutrality in 2050 will be more difficult. We will have to roll up our sleeves: invest, work on mechanisms to industrialize green technologies such as electrolysers or carbon capture solutions.
The competitiveness gap between Europe and the United States is widening. How to fix it?
Europe will have to show more pragmatism. It must tackle excess bureaucracy and emphasize competitiveness and protection of industry. Some regulations are disconnected from reality and slow us down. For example, it is very complicated to obtain “low carbon” hydrogen qualification, because the renewable asset enabling its production must be new, it cannot be an existing asset. Another obstacle is the financing of certain innovative projects: the procedures to obtain them are long and the slightest change along the way – this is not uncommon for non-mature technologies – requires reformulating a request and starting from scratch! These are two examples of rigidities that we would like to see soften. We need to move quickly!
There is also a need for more coordination. We discuss with the Commission and all the regulators of the countries where we operate on the framework for developing assets that will produce low-carbon electricity at the best price in order to meet industrial demand. For this, we need the European market to function without side effects: the poorly coordinated development of solar installations can lead to negative prices at certain times because too much equipment of this type has been built in the same place. ! Battery development mechanisms in combination with solar assets enable more stable electricity profiles that match our customers’ needs.
Do you think that with the inauguration of Donald Trump, the United States could one day blackmail Europe over gas?
It’s hard to know what Donald Trump will do. As a citizen, I hope that the United States will not leave the Paris agreement. Global warming is a global danger, we need every nation to contribute to reducing emissions. A fortiori, those that emit the most greenhouse gases.
As a group, Engie has been able to develop a huge number of renewable energy projects in the United States in recent years, including when Donald Trump was president. For a simple reason: across the Atlantic, economic pragmatism always wins. The projects we design there respond to real demand and, as a result, a considerable market is developing. The main question concerns offshore wind power, a subject on which the future president has taken strong positions, even if a cold snap in this sector would only affect Engie marginally.
The reason comes from the fact that Engie is focusing more on solar coupled with batteries?
It is a booming market in the United States, driven by strong economic growth. Added to this is the development of data centers and the generalization of uses linked to artificial intelligence. All this creates tension on energy demand. Everyone wants it at the same time. This creates opportunities for companies like ours. For example, we have just signed an energy supply contract with Meta. This activity is also growing in other countries. We are going to develop a 100 megawatt battery in Belgium with four hours of storage. We also have development projects in Chile.
Is industrial interest in Power Purchase Agreements, or PPAs, these long-term contracts for the purchase of electricity from renewable energies, confirmed?
Yes, many companies want to secure PPAs, because their electricity is a source of cost but also of CO2. Most of them have made ambitious commitments to decarbonize, they are therefore seeking to contract these green electrons and asking for visibility on the price. This market is very buoyant. Certainly, PPA prices are higher in Europe today, but they are tending to fall. Conversely, they are increasing in the United States due to a shortage of electrons, and green electrons in particular. The two curves are getting closer and European PPPs will eventually become competitive, which is good news for our economy.
Another good news at European level would be that the Commission pushes more interconnections. Would this protect us from possible future energy crises?
The European scale is the most relevant and we will benefit from the potential it represents by using interconnections as much as possible. Our continent can benefit from the complementarity of natural resources and means of production. Lots of sun on the Iberian plate, lots of wind in the North Sea or on the Atlantic coast and the English Channel. Nuclear power plants in France and in the countries which have made this choice. We are building an increasingly low-carbon and resilient European market. Developing the right interconnections, by integrating the means of storage and flexibility, and multiplying them will make it possible to benefit from the strengths of each technology and to face climatic hazards or the growing challenges of access to water.
Could these interconnections extend to Morocco, where Engie is investing?
As far as we are concerned, we have just signed a development agreement with OCP, the Office Cherifien des Phosphates, a major industrial player using ammonia, which has ambitions in terms of renewable energies and decarbonization. This involves the supply of green hydrogen. One of the big challenges of this technology is precisely to find a sufficient number of customers who commit, via long-term commercial contracts, to purchasing green hydrogen, even if it is at a low price today. higher than that of gray hydrogen. In Europe, this long-term demand should be supported.
Will these solutions arrive in France and actually reduce gas consumption?
Gas consumption will fall due to the electrification of uses. Since 2021, it has already been reduced by 15%, and we anticipate an additional reduction of around 10% by 2030, with an increase in green gas, produced from agricultural or household waste. This could represent 20% of gas consumption in 2030. 20%, this is the percentage that gas imported from Russia represented in French gas consumption before the war in Ukraine. We will therefore have replaced Russian gas with green gas produced locally. This is a determining point for energy sovereignty which, once again, is once again becoming a strategic issue.
Gas consumption in France has still not returned to its pre-crisis level. Is this a sign that economic difficulties continue and that sobriety remains largely imposed?
Demand for gas, and to a lesser extent electricity, has remained quite low over the recent period. Although it has not returned to its pre-crisis level, we have observed a slight recovery since the start of the year. In 2024, for electricity, demand will increase by around 1% compared to 2023. It is difficult to distinguish between efficiency, chosen or imposed sobriety… Before the crisis, some households and businesses consumed electricity without really realizing it. They are much more careful. Ultimately, given the massive needs linked to electrification and the challenges of decarbonization, we estimate that demand for electricity will pick up again, with growth of around 2 to 3% per year in all countries. Europeans.
This trend is already influencing Engie’s accounts. Approximately 60% of our operating results come from this activity. And 80% of our growth investments, 8 billion euros per year, are earmarked for electricity investments, whether production, storage or transport.
There is a debate in France about gas taxation. Would you accept that it be further burdened, in order to give the French the right signals, as Minister Agnès Pannier-Runacher explains?
First, taxes on gas have already doubled, since the internal tax on natural gas consumption has increased from 8.37 to 16.37 euros/MWh between 2023 and 2024. On this subject, we must ensure the power of citizens’ purchase. This is a strong concern of the French that cannot be ignored.
More generally on taxes, we have had discussions with the government. As a company, we are attentive to the balance of public finances. Engie will contribute to the collective effort of large companies but it is important that this effort be limited in time, simple and predictable. When it comes to energy, France and Europe have had their share of complex and inefficient systems. We need to get away from this logic.
You have been managing Engie for four years. The board of directors has proposed the renewal of your mandate at the next general meeting, which will be held at the end of April. Under what sign do you intend to place it?
We will communicate a roadmap in due course. There will be constants, in line with Engie’s purpose, the energy transition, the continued transformation of the group. I will be very happy to continue my mission, with the support of the board of directors, and to lead the growth of our group, which has become a major international player in renewable energies. Engie is today a refocused, more industrial group, committed to building the energy system of tomorrow with the ambition of being carbon neutral from 2045. We will continue to develop renewable projects, energy storage, flexibility solutions, centralized and decentralized infrastructures, and to support the transformation of energy consumption… And as the scenario we published shows, there is work!
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