Relieved energy industry cheers ‘bullseye’ Draghi report

EU energy industry associations welcomed the Draghi report, lauding its restraint to attack the bloc’s energy market principles, while MEPs want to make sure it is politically recognised.

The long-awaited 400 page Draghi report urging Europe to focus on productivity growth was broad enough that most Brussels lobby groups could find something they liked – and lots not to like.

“The Draghi report hits the bull’s eye on so many things,” said Giles Dickson, the CEO of industry association WindEurope, particularly welcoming the focus on grids.

While the report stressed the need to decouple power from gas prices, the industry cheered that Draghi refrained from attacking the power market’s foundational principle, the merit order.

“The solar sector is relieved to read the acknowledgment of the critical role of long-term contracts, like PPAs and CfDs, as well as marginal pricing,” said Walburga Hemetsberger, CEO of SolarPower Europe.

Contrary to rumours, “the report does not advocate for radical change of recently agreed market reforms,” said power sector association Eurelectric.

The wind industry welcomed Draghi’s proposal for Brussels to pick winning clean-tech sectors, while leaving others to competitors from abroad.

The suggestion to “channel EU funds into key supply chains while resisting unfair trade practices from abroad” was “spot on,” said Dickson.

Hemetsberger, who represents an industry where China appears unbeatable, says “it is important not to give up on strengthening the EU solar supply chain.”

Eurelectric CEO Kristian Ruby warned against “several untested ideas for reducing energy costs that could use more careful consideration.”

Draghi suggested that some power producers provide electricity to industry exposed to international competition, backed by a cheap long-term contract.

“This approach represents a significant market intervention that risks discouraging investment in the electricity sector,” Ruby said.

Parliamentary backing

The EU’s legislative largely welcomed the report, too. “We need to seriously reduce the regulatory burden on European companies,” said Andreas Schwab, a German centre-right MEP (EPP).

“I am satisfied that he confirms many of the demands that the EPP Group has been making for a long time,” the group’s single market spokesman added.

“We are glad to see some of the S&D Group’s priorities in the report, such as the decarbonisation of the EU economy and the need for a green industrial strategy,” said Iraxte Garcia, president of centre-left S&D.

Both parties vowed to back the report politically. “This report mustn’t get lost in the drawers of Brussels bureaucrats,” said Christian Ehler, the EPP’s industry lead, inviting Draghi to meet lawmakers in Strasbourg at the hemicycle’s next plenary session.

“We expect this report and the report of Mr Letta to shape the incoming European Commission and its priorities,” said Renew’s Valerie Hayer.