EU ministers approve grid overhaul to unlock stranded renewable projects — UnionPress

Member states back a package that could free up more than 800 GW of wind, solar and storage capacity trapped in national grid queues.

EU energy commissioner Dan Jørgensen announced on Friday that the Council of Ministers has endorsed the European Commission's Grids Package, a sweeping set of measures aimed at modernising the continent's electricity networks and removing bottlenecks that are leaving billions of euros of renewable investment on hold.

The package, which will now move to the European Parliament for a final vote, targets the eight most critical grid constraints across the bloc and proposes faster permitting, tighter cross‑border coordination and new financing rules. If implemented, the reforms could free up more than 375 GW of wind and solar projects and 455 GW of battery storage that are currently stuck in distribution‑grid queues in just eight member states.

Europe's power system was designed for a very different era. In the mid‑20th century, a handful of large coal or gas plants fed electricity in a single direction to consumers. Today, almost half of the EU's electricity generation comes from intermittent renewables, a share that grew by 9 % last year alone. The shift to decentralised, variable generation requires a network that can handle many small entry points, store surplus power and move electricity both ways.

Professor Jan Rosenow, who teaches energy and climate policy at the University of Oxford, explains that a more interconnected grid allows regions with cheap hydro, wind or solar to export surplus power to areas where generation is costlier. "The net economic gains are substantial because you can use cheap electricity where it is needed, rather than curbing production because the local network is full," he told TEC.

Without the necessary upgrades, the EU is already losing money. In 2024, €7.2 billion of renewable generation was wasted because the grid could not absorb output during peak production periods. The problem is not merely technical; it translates into higher electricity bills for households and businesses that must rely on more expensive, fossil‑fuel‑based backup power.

The first pillar of the package seeks to cut the notoriously long permitting times for new connections. Currently, a wind farm or solar park can wait five to ten years before it is linked to the grid. The Commission wants to cap this at six months for routine projects and two years for complex cases, shifting from a "first‑come‑first‑served" queue to a "first‑ready‑first‑served" approach.

Second, the package pushes for stronger cross‑border interconnection. The EU's 15 % interconnection target for 2030 remains out of reach for several member states, limiting the ability to balance supply and demand across the continent. The plan earmarks fast‑track funding for the eight most pressing bottlenecks, with the first major cross‑border project already under way: a 3‑GW offshore wind farm being built jointly by Germany and Denmark in the Baltic Sea.

Third, the Commission wants a more coordinated view of grid development. At present, planning is largely national, leading to duplicated studies and sub‑optimal routing. By creating a pan‑European overview, the Commission hopes to reduce costs and avoid the "puzzle without a picture" scenario that Jørgensen described.

Brussels estimates that €1.2 trillion will be needed to modernise the EU's electricity networks by 2040. While the investment promises long‑term savings, a €5 billion spend could avoid €8 billion in system costs, the question of who pays remains contentious.

Traditionally, grid upgrades are funded through fees embedded in electricity bills. To shield consumers from a sudden price spike, the Commission proposes new financing mechanisms, including attracting private capital and using a share of congestion revenues collected by national operators.

Member states were asked to allocate part of these congestion fees to cross‑border projects. Sweden, a net beneficiary of such fees, opposed the proposal, leading the Council to reject the idea. Instead, the package suggests that from 2028 onward, countries contribute 10 % of unspent congestion income, rising to 25 % by 2031. The short‑term financing gap, however, remains unresolved.

Oliver Franz, a regulatory expert with the European electricity industry association Eurelectric, believes the package will be finalised by the end of the year. The speed of implementation will hinge on whether the measures are adopted as a regulation, which would be directly binding, or as a directive, which requires national transposition and could delay impact by up to two years.

Rosenow warns that even the most ambitious EU‑level proposals will falter without national commitment. "If Brussels puts the right ideas on the table but member states do not transpose and enforce them, nothing changes on the ground," he said.

Trade unions have welcomed the move, arguing that a modern grid is essential for protecting jobs in the renewable sector and preventing the cost of energy from being passed onto workers. However, some consumer groups remain wary of any financing model that could ultimately raise household bills, urging the Commission to safeguard vulnerable households.

The grid overhaul is not just a technical exercise; it has direct consequences for European energy security, competitiveness and climate goals. A more flexible network would allow the EU to rely less on imported gas, reducing exposure to geopolitical shocks such as the closure of the Strait of Hormuz or the recent US‑Israel conflict that has already pushed up electricity prices in many countries.

Spain offers a glimpse of what a decarbonised, domestically supplied system can achieve. Since 2019, the country has doubled its wind and solar capacity, delivering cheaper, home‑grown power that has saved the average household around €10 per month despite broader market turbulence. Replicating that success across the bloc hinges on removing the grid constraints that currently trap renewable projects.

For workers in the construction, engineering and manufacturing sectors, the investment could generate thousands of new jobs, especially in regions that have lagged behind in the energy transition. At the same time, a more efficient grid could lower wholesale electricity prices, easing the cost of living for millions of Europeans.

Nevertheless, the scale of the required investment raises questions about fiscal sustainability. While the Commission's proposal to tap private capital could alleviate pressure on public budgets, critics argue that profit‑driven investors may prioritise returns over affordable access, potentially entrenching the very market concentration the reforms aim to dismantle.

The Grids Package now heads to the European Parliament, where legislators will debate the legal form and financing details. If approved as a regulation, the measures could become enforceable from 2025, accelerating the removal of queues and unlocking the stranded renewable capacity.

Should the package be adopted as a directive, national governments will have to transpose the rules into domestic law, a process that could stretch into 2027. In either case, the pace at which member states act will determine whether Europe can meet its 2030 climate targets and avoid further electricity price spikes caused by outdated infrastructure.

As the EU moves toward a more interconnected, decarbonised power system, the success of the grid overhaul will be measured not only in gigawatts of new capacity but also in the ability of households and workers to benefit from cheaper, cleaner energy.