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Repsol's CEO: Europe has to rethink its energy transition

·2-min read
Repsol CEO Josu Jon Imaz delivers a speech during the annual shareholders meeting in Madrid

MADRID (Reuters) - Europe needs to rethink its energy transition as it is preventing investment in some sources for ideological rather than technological reasons, the chief executive of Spain's biggest oil and gas firm Repsol said on Wednesday.

According to Josu Jon Imaz, the Russian invasion of Ukraine was not the only reason for a surge in gas prices.

"In Europe we have opted for an ideological energy transition in which we are selecting or rejecting, preventing investments in certain energy sources for ideological and not technological reasons," Imaz said at an energy event in Madrid.

"The consequence is that consumers pay more for energy and companies cannot pay for energy and CO2 (emissions) increase. We have to rethink all this. We need all sources of energy," he said.

Repsol has embarked on a broad plan to develop renewable energy and has plans to install wind, solar and hydropower plants with a combined capacity of 20 gigawatts by 2030, and is set to invest a chunk of the $4.8 billion it raised from the sale of a 25% stake in its oil business into renewable projects.

Spain is a leader in the development of renewable energy. With abundant sunlight, blustery hillsides and vast plains, Spain is transforming its energy system to rely on renewable sources and expects to get its economy carbon neutral by 2050.

Among the energy sources that are excluded, Imaz cited natural gas from shale deposits, which is banned in Spain and other countries in Europe due to environmental concerns such as the pollution of underground water.

The development of European gas output would have made Europe less dependent on Russia, Imaz said.

The Russian invasion of Ukraine in February triggered an energy crisis in Europe as the European Union responded to Moscow's moves with sanctions and a vow to reduce dependence on Russian energy, while Russia in turn has cut or shut down gas supplies.

According to Imaz, the energy transition in Europe has worsened the current crisis, and has not addressed the main problem it is supposed to address - CO2 emissions.

(Reporting by Inti Landauro and Christina Thykjaer, Writing by Emma Pinedo; Editing by Bernadette Baum)