Europe needs more grid investments to support the large-scale shift towards electric vehicles, renewable energy, and electrification of heating and industry, according to a new report by the European power industry association Eurelectric on Wednesday.
“Distribution grid investments should increase from an average of €33 billion to €67 billion per year from 2025 to 2050, roughly 20% of what the EU spent on fossil fuel imports in 2023,” said Eurelectric’s latest report, Grids for Speed.
Eurelectric’s President and E.ON CEO Leonhard Birnbaum said that for the EU’s successful energy transition, it needs massive amounts of additional grid capacity.
“Investment volumes for distribution system operators need to double,” he said.
Birnbaum warned that the cost of inaction on grid upgrades would far outweigh the investment required. “To succeed, we need attractive returns for investors to be able to finance it, technology and fast electrification to manage the distribution fees.” he added.
Electricity is projected to surge from 23% to 60% of final energy use by 2050, fueled by a six-fold increase in renewable capacity, according to the report.
“Scaling grid investments requires a dual effort. National authorities should implement the agreed legislation, such as anticipatory investments, while adapting the regulatory regime to support the investment surge,” the statement said.
To achieve this, the EU needs to attract private funding, open up public financing through an EU budget, eliminate investment caps, fast-track grid permitting and procurement procedures, and de-risk investments.
The organization representing the electricity industry in European countries, Eurelectric, called on policymakers both at national and regional levels to secure grid investments and strengthen supply chains.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr