Burning gas to produce electricity is ‘stupid,’ the CEO of power giant Enel says

The CEO of Italian energy agency Enel has forged doubt on the continued good thing about utilizing fuel to supply electrical energy, telling CNBC it’s “silly” and that cheaper and higher options are actually accessible.

Talking to CNBC’s Steve Sedgwick on the World Financial Discussion board, Francesco Starace mentioned the place Europe had sourced its fuel from over time, name-checking each Libya and Russia.

Russia was the largest provider of petroleum oils and pure fuel to the EU final yr, according to Eurostat. The bloc is now attempting to wean itself off Russian hydrocarbons following the nation’s invasion of Ukraine.  

“I believe this can be a large get up name,” Starace mentioned, including that “an excessive amount of fuel” was getting used “in a silly manner, as a result of burning fuel to supply electrical energy is, right now, silly.”

As a substitute, Starace mentioned there have been extra engaging options.

“You may produce electrical energy higher, cheaper, with out utilizing fuel … Fuel is a treasured molecule and you must go away it for … purposes the place that’s wanted,” he added.

These industrial makes use of embrace chemical purposes, the paper business and use within the manufacturing of ceramics and glass, he mentioned.

“Spare fuel for them,” Starace mentioned. “Cease utilizing fuel for heating, cease utilizing fuel for producing electrical energy when there are options which can be higher.”

Various strategies of electrical energy era embrace wind and solar energy, amongst others.

According to a recent report from Ember, a assume tank targeted on shifting the planet away from coal to what it calls “clear electrical energy,” fossil fuels have been liable for 37% of EU electrical energy era in 2021.

Breaking down the above determine, Ember’s report — printed in February — mentioned fossil fuel energy produced 18% of the EU’s electrical energy, a three-year low. Renewables have been liable for 37%, whereas nuclear produced 26% of the bloc’s electrical energy final yr, Ember mentioned.

Throughout the Atlantic, preliminary figures from the U.S. Power Administration present that pure fuel was utilized in 38.3% of utility scale electrical energy era in the USA in 2021.

In Starace’s opinion, change is coming to Europe, the place the EU has mentioned it needs to be carbon impartial by 2050. “Total I believe there will likely be a discount of fuel consumption in Europe throughout the board coming principally from these, like I mentioned, ‘silly’ makes use of,” he mentioned.  

“So burning it to generate electrical energy isn’t good anymore, there’s a higher manner,” he mentioned. “Burning it to warmth our houses isn’t clever, there’s a higher manner.”

The Enel Group — whose important shareholder is the Italian Ministry of Financial system and Finance — has mentioned it would abandon fuel era by 2040. It additionally plans to depart the retail fuel market in 2040.

Starace was requested if the transfer to net-zero and deal with utilizing extra renewables in Europe can be turbocharged by the present disaster.

“I believe sure, positively,” he mentioned. “As a result of on high of the economics, on high of the local weather, there’s now [a] safety of provide subject.”

“So you’ve got a mixture of three elements, not two, so positively there’s an acceleration there,” he added.

He mentioned it may take two or three years however, “you’ll begin to see a dent in fuel consumption going ahead, no query.”