London (Platts)--15Dec2011/559 am EST/1059 GMT

Coal and natural gas have no future in the long-term EU energy mix unless they are fitted with viable carbon capture and storage technologies, EU energy Commissioner Gunther Oettinger said Thursday.

Oettinger was launching the EU's new Energy Roadmap 2050 at a Brussels press conference that was broadcast on the internet. The roadmap sets out seven scenarios for the EU energy mix up to 2050.

"Coal will have a future if carbon capture and storage becomes technologically and economically feasible," Oettinger said.

And while the EC says in the roadmap that gas will be "critical" as a transformational technology, Oettinger said its future would also hinge on whether CCS technology can be deployed on a large scale.

"Gas will be important too but it is bound up with our CO2 targets [to cut carbon emissions in the EU as a whole by 80% by 2050]. It can only fit with our scenarios if it is fitted with CCS.

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"At the latest by 2025 gas-power stations will only be feasible if combined with CCS," Oettinger told reporters.

The EU backed the roll-out of a first wave of CCS demonstration plants with funding from its economic recovery package in 2009.

CARBON PRICE WOES

But two of the projects that received funding -- Scottish Power's plans to install CCS at its Longannet coal-fired plant in Scotland, and Vattenfall's plans for CCS at the Janschwalde coal-fired plant in Germany -- have already been scrapped.

A third project to install CCS as part of the conversion to coal of Enel's Porto Tolle oil-fired plant in Italy is embroiled in a legal battle with environmental objectors.

Another 11 CCS projects are bidding for a share of funding from the ongoing sale of 300 million EU carbon allowances from the new entrant reserve -- the NER 300. But the funding this raises depends on carbon prices, which have tumbled to record lows in recent days after Canada's decision to withdraw from the Kyoto treaty.

According Platts assessments, the price of EU carbon allowances for December 2012 delivery was just Eur6.950/metric ton on Wednesday. This compares with average prices above Eur20/mt in 2008.

"It is a mystery how the commission imagines we will be able to transform the energy system with a carbon price rapidly approaching zero and a draft energy efficiency law that is woefully weak," Jason Anderson, head of EU climate and energy at environmental campaign group WWF said Thursday in a response to the roadmap.

"Oettinger's roadmap will remain a pure think piece if not backed by effective legislation," he added.

--Paul Whitehead, paul_whitehead@platts.com

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