An RWE solar plant. As the utility phases out its fossil fuel fleet, CEO Markus Krebber warns against a rush to hive off polluting assets to disreputable entities. Source: RWE AG

While utilities and developers work to deliver Europe's renewable power targets, policymakers pushing for net-zero emissions ought to focus on providing regulatory certainty, energy executives said at the Aurora Spring Forum in London on Sept. 29.

"We are way beyond asking for subsidies. We have proven to bring down [the cost of electricity] dramatically," Andreas Nauen, CEO of wind-turbine maker Siemens Gamesa Renewable Energy SA, said at the event, organized by consultancy Aurora Energy Research. "We have a humble ask: stability."

In Germany, Europe's largest economy, conversations over the future coalition government are ongoing following a Sept. 26 general election in which climate and energy policy were key battlegrounds.

"Finally, climate change is at the forefront," Nauen told the conference. "What I still struggle with is the clarity of the message. It doesn't come across that the energy transition will take time and cost money."

Markus Krebber, CEO of utility RWE AG, said climate and energy policy in Germany will look similar under a coalition led by the Social Democratic Party as it does today under the center-right Christian Democratic Union.

Likely coalition member the Green Party is calling for the closure of Germany's coal-fired power generation by 2030. German industry, already paying some of Europe's highest power prices, is meanwhile cautioning over international competitiveness. Asked whether the government could end up weakening its industrial base in the process of decarbonization, Krebber said, "Only by accident."

Over in Spain, developers and utilities are bemoaning recent market interference. Regulators have introduced a CO2 price clawback and more recently floated a retrieval of windfall profits for low-carbon generators benefiting from surging gas and power prices. "We invest in next-generation technology but then rules come in to pull the plug on projects," Nauen said.

EDP - Energias de Portugal SA CFO Rui Teixeira also pointed to the need for clear frameworks to support renewables investments, telling the conference that the Spanish government harmed its reputation and long-term visibility as a place to build out renewables.

Asked for a best-practice policymaking example, Nauen pointed to the Netherlands, which hosts regular offshore wind auctions and deploys wind farms "like clockwork." This contrasts with Germany's offshore wind build-out, which has slowed in recent years.

"The German government hasn't impressed me in the same way. Germany is still installing the odd project, but clearly we're not leading the world anymore," Nauen said. The country is targeting 20 GW of installed offshore wind capacity by the end of this decade.

'Custodians of high-carbon assets'

A revision of Germany's climate law earlier this year, which moved forward the country's net-zero goal and introduced interim emissions targets, is reigniting debate over an adjustment of energy policy. The Green Party, as well as some climate experts, argue that the new law requires an accelerated decarbonization timeline and more ambitious renewables targets.

To deliver results in the transition, more emphasis should be placed on near-term action and project delivery rather than bigger-picture debates, RWE's Krebber said at the conference.

"The discussion about targets and are they ambitious enough is over. So let's switch gears and get it done," Krebber said, pointing to RWE's partnership with chemicals giant BASF AG, which is looking to source green power for hydrogen production through an off-take deal.

Nora Mead Brownell, a former commissioner of the Federal Energy Regulatory Commission in the U.S., said many innovations and investments from the private sector are yielding faster results than the government can.

"When I look for real change, I see the [likes of Google LLC and Walmart Inc.] pushing innovations of their own and changing their ways of operating, providing enormous demand in the market for renewables," Brownell said at the event. "The private sector can provide leadership and money to deliver what utilities can't."

Pressure from environmental, social and governance-minded investors is also rising, Krebber noted. "In all of our investor discussion, ESG is a key topic. The question is: can we transform faster?" Krebber said. "You cannot switch off all CO2 emissions overnight."

Some may suggest hiving off fossil fuel assets to green the utility's footprint, Krebber said, without specifically naming activist investor Enkraft Capital GmbH, which is reportedly lobbying RWE to shed its lignite business.

"So who is that [new] owner? Probably not a publicly listed company under good governance," Krebber said. "I really hope we can educate investors fast enough, [otherwise there will be] negative consequences."

Alistair Phillips-Davies, CEO of British utility SSE PLC, said utilities should steer their own fleets through decarbonization. "We are custodians of high-carbon assets," the CEO said at the conference.