What the power grid needs to prepare for.
The panel discussion held during The smarter E Europe opening press conference 2024 made one thing clear: The challenges our power grids face as a result of the energy transition are immense. The deployment of new capacities is happening far to fast for the outdated grid to cope with.
Kristian Ruby of Eurelectric, Walburga Hemetsberger of SolarPower Europe, Patrick Clerens of EASE and Maciej Mazur of AVERE talked about the biggest pain points and how to address them.
Is 40 the new 20? The young at heart like to say so. But this does not apply to power grids, said Kristian Ruby, Secretary General of the industry association Eurelectric, at the opening of The smarter E Europe. 30 percent of Europe’s distribution grids are over 40 years old and not equipped to handle today’s challenges. At the same time, there has been little progress in building new power grids. The power grids are turning into the main bottlenecks of the energy transition. Rana Adib explained: “In 2023, 1,500 GW of projects in advanced stages stalled due to issues with permits and grid connection.” During the opening press conference, REN21’s Executive Director presented the latest figures from the third section of the Renewables 2024 Global Status Report (GSR 2024) entitled Energy Supply, which was officially launched at The smarter E Europe.
Doubling investments
Although globally, $300 billion were invested in power grids last year, total investment is stagnating. According to IRENA’s data, $4,800 billion – twice the actual amount – would need to be invested by 2030. This also applies to the European distribution grids. Investments would need to grow from an average €33 billion per year to €67 billion for our power grids to be expanded, modernized and digitalized, Ruby stressed. Even though, as he conceded at the press conference, this sounds like a lot of money, we have to expect 600 GW of renewable energy capacities to be deployed in the EU by 2030, along with 50 million electric vehicles and 50 million heat pumps. “The numbers are dizzying.”
Add to this another factor that makes swift action a matter of urgency: “One of the trends of the energy transition that worries us the most is that while capacities are growing at an amazing rate, the demand for electricity is dropping,” Ruby warns. This is due to mild weather and the deindustrialization of Europe. “Of course the political objectives for the deployment of renewables are important and ambitious. But if the reality of the market is not as expected and there is actually a drop in demand, this means that investments into generation capacity cannot continue.”
Securing financing for new grids
He also stressed the important role of the regulators. Talking to association members and to regulators, Ruby got the impression that there is a lack of sense of urgency when it comes to the regulators’ actions. According to him, we have to address grid expansion with a different mindset to that of the old, static energy world. “We want to look 20 years ahead and build an electric future,” said Ruby. This actually means setting up a system that is oversized for today’s demand, because it is visionary. As Ruby stated, it is better and more efficient to dig up a road once and lay a very thick cable, rather than starting again a few years down the line. However, if we want to make the necessary progress, this kind of vision needs to be remunerated by the regulators. “We cannot just limit ourselves to enhancing efficiency. We have to lay new copper cables, otherwise the electrical future will not happen.”
Walburga Hemetsberger, CEO of SolarPower Europe, also stressed the urgency of grid expansion by comparing the energy transition with a high-speed train without rails to travel on. “We should not just think about cables,” she urged. “Promoting digitalization is also a key part of it.” We have to find a way of providing more flexibility for the power grid. According to Hemetsberger, grid expansion is necessary, but it takes time. Flexibility options, on the other hand, are available at short notice.
Storage systems – the missing piece of the puzzle?
According to Patrick Clerens, General Secretary at EASE, the European Association for Storage of Energy, “energy storage is the key puzzle piece, and the fastest way to boosting grid capacity.” Energy storage is able to provide system services, such as power system inertia, but also store excess energy until it is needed, thus creating the flexibility we need. The need for flexibility is underestimated by many grid operators, member states and other players. Clerens pointed out that, unless we take more decisive action, according to calculations by the European Commission’s Joint Research Centre, by 2040, 310 TWh of electricity from renewable sources of energy will have to be curtailed every year. That is the annual electricity consumption of the 14 smaller EU countries.
Maciej Mazur, President of the European Association for Electromobility, AVERE, reminded everyone of the fact that electric vehicles have an important role to play as storage devices. In the 2030s, millions of battery-electric vehicles will double as energy storage devices.
