Eurelectric, the federation of the European electricity industries, has unveiled its annual ‘pressure check’ of the European power sector, the Power Barometer 2023. At the same time, it launched a free online tool – ‘Elda’ – that provides data on electricity generation, demand, prices, capacity, CO2 emissions, and cross-border flows in all EU countries, the UK, and Norway.
Although the most severe aspects of the energy crisis seem to be subsiding, geopolitical tensions continue to be a central concern on the political agenda. This, say Eurelectric, underscores the need for even more resolute actions to safeguard Europe's energy independence through electrification, modernisation of the grid, and the fair allocation of risks and rewards connected to the energy transition.
Key takeaways:
- After a historically challenging year in 2022, positive trends have emerged. Power prices have improved, with wholesale prices stabilising from an average of €227/MWh in 2022 to €100/MWh, followed by corresponding reductions in retail prices. Progress is being made in the electrification of transportation and homes, with electric vehicle and electric bus sales reaching 21% and 13.7%, respectively, and the stock of heat pumps amounting to 20 million.
- Investment in networks and storage infrastructure is falling behind. With grid investment needing to increase from €36 billion per year today to €65 billion per year until 2030 (an +84% increase), it is imperative that Europe launches an ambitious Power Infrastructure Deal, ensure access to EU funds, modernise tariffs, and incentivise anticipatory investments.
- On the generation side, to triple electrification rates and reach 58% by 2050, it is essential to streamline permitting processes and ensure adequate investment signals for all necessary assets and technologies, bearing in mind that electricity generation capacity needs to double by 2030.
- With oil and gas companies reporting record profits, up 268% year-on-year compared to 2022, in contrast to a +25% increase for utilities, the Power Barometer sends a strong signal that political attention and interventions should be proportionate and directed to the sectors that make the most profits.
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