It “will take years” to bring energy prices back to pre-Ukraine war levels, the boss of one of the world’s largest energy companies has told the BBC.
Enel’s Francesco Starace said lowering prices depends on new energy sources such as renewables and heat pumps.
Governments across Europe are spending billions to help businesses and households afford energy bills.
They are also scrambling to secure new supplies.
Mr Starace said the company, which produces and distributes electricity and gas, has been trying to protect its 20 million European customers from energy market volatility this year.
They did their best to stick to the agreed fixed-price contracts, he said.
Breaching customer confidence would do more harm to the company than a hit to full-year results, he said.
The Italian energy giant sells electricity to more than 70 million homes and businesses in over 30 countries.
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But Enel plans to exit many of those countries as it focuses on renewable energy and becomes carbon neutral by 2040.
It also wants to reduce its huge debt of around $63 billion (£52 billion).
It’s investing heavily in solar panel manufacturing as it expands an existing factory in Sicily and builds a new one in the US.
Rising energy prices have been the biggest contributors to inflation and the cost of living crisis in the UK, US and the eurozone.
The global energy crisis triggered by Russia’s invasion of Ukraine “shows very clearly how dangerous dependence on a single energy source is for Europe,” Starace said.
The future will be “extremely decarbonized” and dependent on nuclear and renewable energy, he said.
However, switching to renewables also entails risks.
In July, the International Energy Agency said China’s dominance in solar and wind turbine production “creates potential challenges that governments must address.”
Mr Starace said the West is overly dependent on China for renewable energy and other commodities.
“Some balance has to happen because it’s healthy,” he said when asked about geopolitical tensions affecting energy supplies.
This has helped spur Enel’s investments in solar panels, although the expansion of the Sicilian factory will still only meet 10% of Europe’s needs, he said.
Political leaders have also recognized that Europe needs to draw its energy from more places.
According to the European Council on Foreign Relations, the EU and its member states signed 56 energy agreements with 23 countries this year.
Recent included a 15-year deal for Germany to source liquefied natural gas (LNG) from Qatar through a deal with ConocoPhillips.
Norway is also increasing natural gas production and the world’s largest producer, the USA, is producing record quantities.
That means the chances of Europe repeating its dependency on Russia with another country are “pretty slim,” according to Megan Richards, former director for energy policy at the European Commission.
“A lot of work has been done” to replace Russian energy, she added, before warning: “I think Europe will be domestically independent for a very, very long time, if ever,” although “renewable energy will increase dramatically.” .
You can watch Francesco Starace’s full interview on Talking Business with Aaron Heslehurst BBC iPlayer.
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