London (Platts)--15Dec2011/614 am EST/1114 GMT

Natural gas and renewables have been identified as "critical" energy sources to 2050 in each of the seven scenarios outlined by the European Commission in its Energy Roadmap 2050 published Thursday.

"Gas will be critical for the transformation of the energy system," the EC said in a statement.

"Renewables move center stage. The share of renewable energy rises substantially in all decarbonization scenarios, achieving at least 55% in gross final energy consumption in 2050," it said.

The EU wants to cut greenhouse gas emissions to 80-95% below 1990 levels by 2050. The roadmap outlines seven different scenarios under which this target could be achieved.

"Every scenario is based on a different energy mix, combining varying shares of renewables and the importance given to energy efficiency and new technologies such as CCS," the EC said.

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Following the Japanese Fukushima nuclear disaster in March the future of nuclear energy in Europe has become a politically sensitive issue. The EC's roadmap scenarios include delayed carbon capture and storage with the share of nuclear energy in primary energy consumption amounting to 18% and a low nuclear with higher shares of CCS, around 32% in power generation.

The EC said that irrespective of the energy mix chosen, the demand for renewable energy would grow, energy savings would be crucial, the role for electricity would increase, capital investment would increase, and fossil fuel expenditure would decrease.

The analysis shows that if Europe continues with its current policies, the total energy system cost -- including fuel, electricity and capital costs, investment in equipment, energy efficient products -- could represent 14.6% percent of European GDP in 2050 compared with 10.5% in 2005.

"By describing these scenarios and also their impact on costs and prices, it should help countries to make the necessary policy choices," the EC said.

"If the political choices are not made, there is uncertainty and much needed investments will be delayed. In the energy sector, investments are made for a period between 20 and 60 years," it added.

NO MENTION OF 2030 RENEWABLES TARGET

While there are no specific references to setting any renewable energy targets for 2030 in the roadmap, the EC does make clear the need for a stable renewables investment environment beyond 2030.

"In the case of renewables, investment needs beyond 2030 are considerably higher than in the case of the other scenarios. This is due to increased storage needs, extension of the grid and back up facilities such as gas power stations," it said.

"Most of these investments will come after 2030 due to the sharp increase of renewables in the same period of time. This means also higher electricity prices," it added.

The EC launched a consultation on December 7 on whether on not the EU should set renewable energy targets for 2030.

But initial analysis of the energy roadmap by Green lawmakers in the European Parliament say the EU will face an uphill struggle in securing a 2030 target.

"The resistance against a 2030 target is huge, especially among the European energy giants. In order to achieve the 20% renewable energy target by 2020, renewables would have a share of about 35% in the electricity sector. In 2030, they would then account for a share of 55-65% in the electricity mix," Luxembourg Green member of the European Parliament Claude Turmes said.

But Turmes said the final text announced Thursday was more optimistic about renewable energy and energy efficiency than earlier drafts, which the Greens had criticized for implicitly favoring nuclear energy and carbon capture and storage. He said the final text was more lukewarm on these.

"It shows -- at least between the lines -- that the hope for early breakthrough of CCS technology has been given up by EU Commission," Turmes said in emailed comments.

--Rachel Morison, rachel_morison@platts.com

--Paul Whitehead, paul_whitehead@platts.com

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