EU Proposes Action Plan for Faster Rollout of Electricity Grids

An investment of $637 billion is required to meet expected distribution demand by 2030

November 30, 2023


The European Commission has proposed an action plan to ensure that electricity grids in the European Union (EU) operate efficiently and are rolled out further and faster.

The action plan aims to help deliver the European Green Deal, which is a package of policy initiatives targeted to reduce net greenhouse gas emissions by nearly 55% by 2030.

With 40% of the EU’s distribution grids more than 40 years old and cross-border transmission capacity due to double by 2030, €584 billion (~$637 billion) in investments is necessary.

The action plan focuses on the following:

  • Stimulating faster permitting for grid deployment by providing technical support for authorities and guidance on better engaging stakeholders and communities
  • Improving the long-term planning of grids to accommodate more renewables and electrified demand, including hydrogen, in the energy system by steering the work of system operators as well as national regulators
  • Introducing regulatory incentives through guidance on anticipatory, forward-looking investments and cross-border cost sharing for offshore projects
  • Incentivizing a better usage of the grids with enhanced transparency and improved network tariffs for smarter grids, efficiency, and innovative technologies and solutions by supporting the cooperation between system operators and recommendations by the Agency for the Cooperation of Energy Regulators
  • Improving access to finance for grid projects by increasing visibility on opportunities for EU funding programs, especially for smart grids and modernization of distribution grids

To fulfill the objective set in the REPowerEU Plan to end imports of Russian fossil fuels and the recently agreed target to reach 42.5%, with an ambition for 45% renewable energy share by 2030, the EU needs upgraded grids and strengthened energy infrastructure.

The EU Action Plan for Grids was announced in the European Wind Power Action Plan tabled by the Commission last month.

Networks will have to incorporate a significant amount of varying renewable energy. By 2030, wind and solar energy generation capacity must increase from 400 GW in 2022 to at least 1,000 GW, with a significant growth in offshore renewable energy up to 317 GW to be connected to the land. As a result, the grid must adapt to a more decentralized, digitalized, and flexible electricity system with millions of rooftop solar panels and local energy communities sharing resources.

In October, the European Commission outlined a six-point action plan to make Europe’s wind energy industry competitive by ensuring financial support and faster permitting.

The Net-Zero Industry Act, which aims to fortify Europe’s manufacturing capabilities in crucial technologies essential to meet climate change, was backed by the Members of the European Parliament recently.