Green laws and regulation risk energy crisis, say Europe's power companies

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Europe is facing an energy crisis because of green-influenced legislation and regulation, and difficulty in obtaining planning approval for key projects, energy companies warned yesterday.

Europe needs to spend €2tn (£1.5tn) on upgrading power networks in the next 25 years but leading energy companies have cancelled investments in new power plants worth billions of euros because of increased regulatory uncertainty, a senior executive claimed yesterday.

Johannes Teyssen, chief operating officer at E.ON, Germany's biggest energy group, blamed the European commission's plans to make companies pay for all their pollution permits from 2013, huge delays in approving planning applications and confusion among national regulators for the cancellations.

Teyssen, vice-chairman of the World Energy Council (WEC) Europe, said: "We see now every week a new investment project being cancelled across the EU." He cited at least four multibillion-euro projects to build power plants in Germany and said thousands of kilometres of new power lines were "lying on the table" because of planning delays.