European Energy: More ambitious and immediate action needed to reach Paris Agreement goals

In a world with growing power demand, renewable energy project developer European Energy provides solutions for the energy transition necessary to combat climate change. CEO and Cofounder Knud Erik Andersen talked to our Nordea On Your Mind author Johan Trocmé about the merits of climate technologies, such as wind power, battery storage and Power-to-X, as well as key hurdles and risks and how they vary around the world. These challenges also affect the financing of renewable energy projects, which would benefit from being de-risked by coordinated global policy efforts.

Johan Trocmé (JT): European Energy was started 20 years ago – could you briefly describe your business today and how you have evolved since 2004? How did it all start?

Knud Erik Andersen (KA): European Energy was founded in 2004 with a focus on renewable energy, starting with onshore wind projects. Over the years, we have grown and diversified significantly. Today, we are involved in onshore and offshore wind, solar, Power-to-X technologies and battery storage. Our mission is to accelerate the global energy transition by developing and operating green energy projects worldwide.

The company has evolved from a small startup, focused on a niche market, into a major player in the renewable energy sector, with projects in numerous countries.

JT: What is your view on the progress so far towards the Paris Agreement target to limit global warming to no more than 2°C?

KA: Progress towards the Paris Agreement goals has been mixed. While there has been significant development in renewable energy deployment and growing awareness of climate issues, global emissions continue to rise in many areas.

Achieving the 2°C target requires more ambitious and immediate actions across all sectors, including energy, transport and industry. We believe renewables can play a key role in meeting these targets, but current progress is not yet sufficient to meet the goals of the Paris Agreement without an acceleration of efforts.

JT: How big a part do you expect the renewable energy transition to play in global efforts to limit global warming and climate change?

KA: The renewable energy transition will be one of the most crucial components inglobal efforts to limit global warming. By decarbonising the energy sector, we can significantly reduce greenhouse gas emissions.

Renewable energy – particularly wind, solar and emerging technologies, such as Power-to-X – can replace fossil fuels in electricity generation and help decarbonize other sectors, including transportation and heavy industry. We believe renewable energy will be central to any successful strategy to limit global warming, especially as energy demand continues to grow.

JT: Out of all the areas you are involved in – onshore and offshore wind, Power-to-X and battery storage – which do you believe offers the greatest potential? Could you touch upon each area and the role it can fill?

KA: Taking them one at a time, I would say the following:

• Onshore wind is mature, cost-effective and scalable, with immense potential for further growth, particularly in areas with abundant wind resources. It continues to play a key role in the renewable energy mix.
• Offshore wind is more expensive, but with higher wind speeds and the ability to build large-scale projects, its capacity can be enormous. At European Energy, we are starting two major offshore projects in Denmark. However, the offshore industry is currently undergoing adjustments, and its costs remain relatively high compared to other technologies.
• Power-to-X technology enables the decarbonisation of sectors that are difficult to electrify, such as heavy industry, shipping and aviation. As one of the first movers in this area, European Energy believes Power-to-X holds enormous potential to achieve net-zero emissions.
• Battery storage is critical to balance intermittent renewable energy sources, such as wind and solar, ensuring grid stability and energy availability during peak demand or generation fluctuations. We will soon begin testing batteries in Denmark, with strong potential for rollout in many of our markets.

JT: What do you see as the greatest challenges for the renewable energy transition today?

KA: There are several challenges, including 

• Permitting processes for new projects: Lengthy and complicated permitting processes can delay the implementation of renewable energy projects. Simplifying these processes is crucial to accelerate the transition.
• Grid infrastructure challenges: In many places, it can take years to establish grid connections for renewable energy assets. Expanding grid infrastructure is essential to support the growth of renewable energy.
• Other issues include the need for technological advancements in storage and Power-to-X. To address these issues, we need regulatory reforms, better coordination across industries and strong political will.

JT: What differences do you see in the outlook for renewable energy transition among North America, Europe, Asia and emerging markets?

KA: In North America, the US has great potential for renewables, but progress varies by state and political context. Political uncertainty, moreover, remains after four years of the Biden administration.

Europe leads in renewables, owing to strong policies, public support and technological advancements. The EU's Green Deal aims to make Europe climate-neutral by 2050, driving significant clean energy investments.

In Oceania, Australia is seeing significant growth in solar and other renewables, with strong political and local support for our projects there.

As for South America, European Energy has a strong presence in Brazil, where we operate several wind and solar farms. We have good cooperation with Brazilian authorities and energy companies that are also very interested in Power-to-X.

JT: How much of an issue is funding for renewable energy investments today? What needs do you see, and what obstacles need to be overcome?

KA: Funding for renewable energy projects remains a critical issue, particularly for emerging technologies, such as Power-to-X and large-scale battery storage. While private-investor interest is growing, gaps in financing still exist for projects in developing regions and for more innovative technologies.

Some key obstacles include

• Access to capital: Many renewable projects require large upfront investments, which can be difficult to secure, especially in developing countries.
• Risk perception: Investors often see renewable projects as riskier, due to long payback periods or reliance on regulatory frameworks that may change.
• Policy uncertainty: Clear long-term policies are needed to give investors confidence that their projects will be supported.

Addressing these barriers will require coordinated global efforts, public-private partnerships and policy frameworks that de-risk renewable energy investments.