The new EON, the new Johannes Teyssen: “The future is state-led renewables, stop dreaming of perfect Energy Union and Emission Trading System”

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Johannes Teyssen (photo Eon)

Johannes Teyssen (photo Eon)

In one of his first in-depth interviews since the restructuring of EON, CEO Johannes Teyssen sets out a completely new vision of where he sees European energy markets and policies going. The future according to Teyssen is: distribution much more than transmission; state-led renewables auctions and capacity markets, not wholesale energy-only markets; carbon taxes or floor prices, not carbon trading or emission trading; higher energy efficiency targets, not higher renewables targets; and a total overhaul of the grid. Teyssen, who only three years ago told Energy Post he was opposed to national support schemes for renewables and wanted only the EU’s Emission Trading System as climate instrument, now says he is not much interested anymore in EU “dreams” of “a perfect world of an Energy Union with a perfect level playing field”: “I’d rather see some low-hanging fruit harvested”. His first priority now is “my customers”, the second EON. “Politics is a distant third.”

Less than two weeks after EON completed the spin-off of its conventional energy arm Uniper, Johannes Teyssen, the man who led this first radical restructuring of a major European utility company shaken by the energy transition, appears to be a new man himself. He has a very different vision of the future than he displayed nearly three years ago in an interview we did with him when EON was still an integrated company relying heavily on conventional power plants.

At the time, his main concern was for the EU to create a “market design” based on a free, competitive internal market, whose only climate instrument was the EU Emission Trading System (ETS). Now he believes that such a perfect market design is a dream. He argues that it may be better to replace the EU ETS with a carbon tax or a floor price.

He has also accepted that all countries will have their own support schemes for renewable energy. “For a long time to come we will have renewables auctions managed by the State,” he says, although he does hope the EU will create a “common rulebook for how member states can do their renewable energy auctions”.

He believes it is only natural that countries will also set up their own capacity markets: “In a world with growing renewables, you need capacity markets. You see them re-emerging everywhere…. In future, the capacity part of the market will grow and the energy part will decline.”

But Teyssen is much less concerned with politics these days. He is focusing on turning EON into a customer-centred company offering network services, renewables and customer solutions: “We have several million customers already buying products that are not commodities.” He notes that distribution networks will be much more important in the future than transmission networks. He believes the grid will need to “totally rebuilt”.

You can read the full interview on our premium newsletter Energy Post Weekly. If you don’t subscribe yet, no worries: you can register for a free trial here. If you want to know where European energy policies and markets are headed, in the vision of one of Europe’s most influential energy business leaders, don’t miss this candid interview. 

Comments

  1. Michael Hogan says

    Nothing new here, Mr. Teyssen is promoting his company’s vested financial interests (not that there’s anything wrong or unexpected about that). Three years ago he was running a company with a large and growing portfolio of stranded thermal generating assets, and there was not a sliver of space between his views and those of other Eurelectric members in a similar position. Today, he’s running a company with a strategic focus on renewables and customer service but with a large residual exposure to the stranded assets he once oversaw. So now he says he likes policy support for renewables and distributed resources, which means he has to promote subsidies for both the thermal generation that’s already been stranded and the thermal generation that will be added to the pile as new zero-carbon resources are added to the system, despite the fact that he must know that there is no way both are needed to keep the lights on. And, not surprisingly, there is still not a sliver of space between his “new” position and the position being promoted by his fellow Eurelectric members, which is to blur the boundary between the robust case for continued support for deployment of new zero-carbon resources and the non-existent case for subsidizing unneeded and inappropriate high-carbon thermal generation.

  2. Math Geurts says

    Remember: in the beginning it were politicians (whispered by economists) not people in energy companies who believed in a liberalized European energy market. At the end it will be politicians not people in energy companies who will prevent such a market to succeed.

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