European Grids Package: A digital backbone for Europe’s energy

The European Grids Package is a crucial step to place grid infrastructure front and centre for Europe at a critical moment, as networks face mounting roadblocks to deliver electrification for the energy transition. 

We strongly welcome the European Commission’s own recognition that grid-enhancing technologies (GETs) are central to modernizing Europe’s power system, nearly doubling network capacity, while cutting costs by up to 35% by 2040.

Digitalization lets grid operators optimize existing infrastructure, target high-value upgrades and manage congestion through forecasting and monitoring tools. Using current assets first is key to a secure, affordable and sustainable energy transition. 

DIGITALEUROPE’s membership includes European energy providers, clean tech leaders including grid equipment manufacturers and industrial energy consumers, such as data centres, giving a full system view of Europe’s energy transition. To remain globally competitive and strengthen the security and resilience of critical infrastructure, Europe must prioritise investment in grid modernisation and digital innovation.

DIGITALEUROPE highlights that despite the European Commission’s recognition that €1.2 trillion in grid investment is required by 2040, the Grids Package falls short in addressing the scale and urgency of investment required at the distribution level, where action is most urgently needed.  

We therefore recommend to: 

• Ensure grid tariffs reward digital investments, extend to distribution grids the proposed binding digitalisation requirements for transmission networks, and establish more robust definitions for ‘smart electricity grids’ and ‘non-wire solutions’;   
• Strengthen investment incentives by updating grid tariffs to reward both capital expenditure (CapEx) and operational expenditure (OpEx);
• Strengthen network planning coordination across all voltage levels and investment phases;  
• Accelerate permitting through national capacity building, focused implementation and reduction of grid permitting deadlines to a maximum of 1 year, in line with the Renewable Energy Directive (RED);
• Ensure clear national frameworks to enable efficient and timely grid connections.