European energy bosses join IEA’s call for grid action

The IEA’s recent report on Electricity grids and secure energy transitions presenting a global stocktake came under the spotlight at Enlit Europe 2023.

“The grids are the backbone of the energy transition,” said Marianne Laigneau, CEO of Enedis, in the opening keynote at Enlit Europe 2023.

And the IEA in its recent report forecast that the grids – transmission and distribution combined – need to double from their current length over the next two decades with the addition of some 80 million km through expansion and modernisation to keep pace with the required rollout of renewables.

That, Pablo Hevia-Koch, Head of Renewable Integration and Secure Electricity Unit at the IEA pointed out in a press presentation of the report, is equivalent to 2,000 times around the circumference of the Earth.

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But at the current pace of development, it won’t happen: investment in the grids has stagnated and fallen behind renewables and instead the grid is becoming a bottleneck in slowing the pace of new renewable connections.

To achieve the proposed target investment in the grids needs to double to over $600 billion by 2030, in step with that in renewables.

Failure to meet the targets would have impacts on the consumption of fossil fuels and a global temperature increase above 1.5oC with a 40% chance of exceeding 2o, said Hevia-Koch, pointing to a six point ‘call to action’.

These include focusing on updating planning, unlocking investment by improving how grid companies are remunerated, addressing regulatory barriers, securing supply chains, leveraging digitalisation and building a skilled workforce.

Grid energy efficiency

Speaking at the press conference, Frederic Godemel, Executive Vice President for Power Systems and Services at Schneider Electric, highlighted the effect of energy efficiency on the grid, with one unit of electricity on the demand side corresponding to two units of generation and how even a net zero building, such as the company has built needs to be grid connected.

And Gianni Armani, Director, Enel Grids & Innovability, referenced the huge growth in new grid connections in the company’s service areas in Italy, Spain and Latin America, approaching 50,000 a month and 500,000 for the year by the end of 2023 and a projected 5 million by 2030.

“The connections needs to be plug and play for these new customers,” he said, commenting on Enel’s recent announcement of almost €19 billion in grid investments, over half the total, over the next three years.

Supply chains

Among participant’s top issues of discussion were supply chains and skills, with Godemel commenting that some, such as Schneider Electric’s European regional supply chain was “back to normal” after governments’ disruptions due to Covid.

However, some such as that for HV equipment was now reliant on suppliers in the east, particularly China, and he called for a policy on components for the grid of the future, covering all aspects from raw minerals down to electronic microchips.

Armani echoed this, highlighting the loss of a transformer supply chain in Europe and called for a reshaping and reform of supply chains.

Hevia-Koch said projects need to be proposed and supply chains are then needed to deliver on these.

Godemel added that forecasting is necessary to adapt manufacturing capacity, with for example an 18-month lead time to build a factory, and Armani noted Europe’s “clear competitive advantage” with its cost of capital.

“We need stable demand … [ultimately] we need state regulation,” Armani concluded.