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* EU's Oettinger says Germany must work with neighbours on energy
* Needs to align green power reforms, grid expansion, research
* Must avoid over reliance on Russia for raw materials
By Vera Eckert and Christoph Steitz
BERLIN, Jan 22 (Reuters) - Germany must turn away from its go-it-alone energy shift and work more with the European Union to build a cost-efficient, secure and sustainable sector, European Energy Commissioner Guenther Oettinger said on Tuesday.
"Germany has to make its energy transformation compatible with Europe," Oettinger said on the opening day of Germany's most prestigious energy gathering, the three-day annual Handelsblatt conference.
"Germany will only succeed and we will only get the authority to speak for our energy interests worldwide when we in the EU act as partners," he added.
Oettinger, a German national, has often criticised the speed of Germany's shift away from nuclear energy after the 2011 Fukushima disaster. The shift entails supporting renewable energy at ever-rising costs, burdening consumers with higher prices and distorting market patterns via supply volatility.
European neighbours have watched with suspicion the exemptions that Germany grants its industry from energy-related costs, and other fall-out such as uncontrolled surges of green power crossing borders which harms stability on transmission lines.
"Across Europe, we have a huge need to catch up on investment and technology for the energy infrastructure," Oettinger said. "Germany running ahead without consideration discourages neighbours when it comes to participating."
Germany accounted for 2.5 percent of global harmful greenhouse gases emissions while the EU overall contributed 11 percent, which meant when it came to discussing in climate protection worldwide, its national voice alone counted little, he said.
Tasks such as power grid expansions to enable transport across borders and future power storage - a precondition for the EU to become more renewable-based in coming decades - needed to be solved by Europe, not Germany and its 16 individual states.
National and state-level German politicians represented voters hostile to coal which undermined EU-wide initiatives especially carbon-capture and storage (CCS) programmes, where the division among German states prompted the bloc's biggest economy to pull out.
"I ask from Germany to return into the fold of the CCS developers, ... it won't work without the country of engineers," Oettinger said.
He said that reform of the law for subsidising German renewables and creating better power market designs to regulate the interaction between green and conventional energy should reflect the need for harmonisation at EU level.
"To create 28 different national capacity markets in the EU and 16 within Germany - that would be a no-go, not with Brussels," he said. Croatia is due to join the EU in mid-2013 as the 28th member.
Turning to Germany's energy partnership with Russia, Oettinger said Berlin should not drop solidarity with other member states.
Germany receives far more oil and gas from Russia than the EU-average and has nurtured a constructive relationship. It has attracted direct Russian investment and secured first access to gas arriving via the new North Stream gas pipeline.
Oettinger is a big proponent of the creation of a southern corridor for Caspian Sea gas to find its way to Europe, independent of Russian pipelines and has often criticised Russia's use of energy supply as a geopolitical tool.
"If Russia continues its divide and rule ... the net effect will be losses for Europe on the whole," Oettinger said. (Reporting by Vera Eckert and Christoph Steitz; editing by Keiron Henderson)