Johannes Teyseen, chief executive of E.ON said the price difference between Europe and the USA would lead heavy industry to invest in the latter.
He added that it would take years of innovation and investment before Europe could hope to compete, regardless of whether the continent decided to embrace fracking technology.
For Teyseen, the best chance for Europe to see cheaper energy prices, would be if Australia and China began fracking. This would free up reserves from Qatar and push down global prices.
Environmental subsidies hurting market
Teyseen added that the European energy market is being distorted by green subsidies and blamed these measures for E.ON having to mothball gas powered energy plants, which remain efficient but have become unprofitable.
Speaking to the Financial Times about Europe’s environmental policy, he said: “European power is getting dirtier. The CO2 content is increasing in spite of the renewables. It is unaffordable, and it’s losing its security. So the alarm signs are tremendous.
“We are feeding a giant with baby nutrition, missing the point that this giant can and needs to walk on its own feet now.”
E.ON is not alone in complaining about green subsidies. In fact, most of the UK’s big six energy suppliers have singled out green initiatives as a major reason there may be energy price rises in the run up to winter.
‘We shouldn’t be further ahead of our partners in Europe’
Teyseen’s comments may well resonate with UK Chancellor George Osborne, who recently announced he did not want environmental subsidies to price Britain out of the energy market.
Speaking ahead of the Conservative party conference, he told the Times: “I want to provide for the country the cheapest energy possible, consistent with having it reliable, in other words as a steady supply, and consistent with us playing our part in an international effort to tackle climate change.
But I don’t want us to be the only people out there in front of the rest of the world. I certainly think we shouldn’t be further ahead of our partners in Europe.”
The comments have been criticized by several environmental groups, including Friends of the Earth, who said Osbourne was “not only contributing to climate change, [but] also undermining our economic future by keeping the nation hooked on increasingly expensive fossil fuels.”