Centrica chief executive Sam Laidlaw spoke at the FT European Gas Summit in London.
Addressing the conference on ‘Europe’s energy challenges’, Sam spoke of the downward shift in wholesale gas and oil prices and the consequent benefits for European consumers and businesses.
He pointed to longer term causes for the price change: new supplies such as US shale coming on stream , new LNG projects delivering them to market, and increased energy efficiency.
But he warned against complacency, saying that a revival in economic growth in developing markets or geopolitical shocks could reverse the downward trend.
He said: “Questions remain about whether lower wholesale energy costs are a blip or something more structural.
“What is clear though is that some of the assumptions we have made in Europe about sharply increasing fossil fuel prices need to be revisited.
“That in turn prompts the question of whether policymakers should reconsider some of the choices they have made about energy.”
As an example, he pointed to the incentives offered by successive UK governments to renewable and low-carbon technologies meaning that UK consumers are unlikely to enjoy the benefit of lower power prices.
“Affordability must be the watchword if we are to achieve an energy policy which is both green and sustainable, because without popular support it will fail.”
“In the real world, there are trade-offs that have to be made between decarbonisation, security of supply and affordability – the energy ‘trilemma’ of our time.”
However, Sam said he remained optimistic, outlining the path set out in Centrica’s ‘Energy Choices for the UK’ report published earlier this year.
This sets out a practical and achievable way to meet long-term carbon reduction targets without placing unnecessary costs on households and businesses.
He concluded: “The challenge for governments is to have an honest conversation about our precious environment and to set a framework that has broad support. Then let the markets and innovation deliver.”
The FT European Gas Summit is attended by gas suppliers, industry experts, energy commentators, and government decision makers.
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