The bosses of eight European energy companies have warned EU leaders that the region’s energy sector is in a “perilous situation” and action is urgently needed.

The chief executives of Enel, Gasterra, GDF Suez, Iberdrola, ENI, RWE, E.ON, Gasnatural Fenosa met yesterday to agree a joint statement to underline “the seriousness of the current challenges for the sector and to propose appropriate policy actions”.

According to E.ON, there is a “lack of visibility and regulatory uncertainty which will inevitably lead to an absence of energy investments, with negative effects on security of supply, employment and reactivation of the European economy”.

The eight companies stress that “the status quo is simply not an option”.

The signatories remain committed to the EU’s ambition for an energy policy based on the principles of competitiveness, security of supply and sustainable development, and they also back the need for liberalisation of energy markets.

However, in a statement they said that “the reality that each of the respective energy companies has experienced, over recent years, is that EU and some national energy policies have not delivered the full expected benefits”.

“In concrete terms, European energy companies are experiencing a perfect storm which is endangering security of supply and the transformation towards a low-carbon economy, as well as undermining their capacity to attract capital.”

The companies want to see a revamped EU approach encompassing the following elements:

● An improved market design, including a European co-ordinated approach to capacity mechanisms in which all assets contributing to the security of supply of European customers are fairly remunerated;

● A European carbon market able to support climate-friendly technologies and in which a reliable perspective is provided, notably, by establishing ambitious but realistic and stable post-2020 greenhouse gas emissions targets;

● A more sustainable approach to the promotion of renewables so as to reduce costs for citizens and favour greater convergence between EU Member States;

● A strengthening of policy framework to trigger investments in promising technologies, such as energy storage, new renewables, shale gas and smart grids.