Image Source: Reuters
According to the estimate of European Commission, around €584 billion is needed to invest in electricity grids in Europe in the current decade.
That is a huge amount of money, however, there is an easy explanation for this fact.
Growing electricity demand in Europe is anticipated due to the increasing consumption of electric vehicles, heat pumps and electric-based processing of industry. In parallel, the usage of renewables like solar and wind is on an upward trend.
However, the problem is that the electricity grid must also cope with growing electricity consumption. European Commission claims that around 40% of distribution grids in Europe are already more than 40 years old.
While new power generation capacities are needed, the electricity must be delivered from the place of generation to the place of consumption.
Thus, even if a wind farm or a solar project is ready to produce electricity, there may be not enough grid capacity in the area to connect it to the grid.
The situation with using electricity by businesses and industries is similar. Companies and industries may have money and the necessary plan for implementation of their projects but may still have to wait for the suitable grid connection.
Moreover, building new substations and power lines is a time-consuming process as well. Planning, permits, and equipment shortages are among factors which may slow down the projects.
As a result, when we consider the issue of energy transition, very often the question of electricity generation is discussed. However, another question is equally important and is: Is it possible for Europe to deliver electricity around the continent?
Sources: European Commission - European grids
European Commission - Smart grids and meters
