EU power grid needs trillion-dollar upgrade to avert Spain-style blackouts

Japan Times

06-05-2025

Europe's aging power grid and lack of energy storage capacity will require trillions of dollars in investments to cope with rising green energy output, increasing electricity demand and to avoid blackouts.
A week ago, Spain and Portugal lost power in their worst blackout. Authorities are investigating the cause, but whatever the findings, analysts and industry representatives say infrastructure investment is essential.
"The blackout was a wake-up call. It showed that the need to modernize and reinforce Europe's electricity grid is urgent and unavoidable," Kristina Ruby, secretary-general at Eurelectric, Europe's electricity industry association, said.
The European Union's power grid mostly dates back to the last century and half the lines are over 40 years old. Rising low-carbon energy production and booming demand from data centers and electric vehicles require an overhaul of the grids that also need digital protection to withstand cyberattacks.
While global investment in renewables has nearly doubled since 2010, investment in grids has barely changed at around $300 billion a year. The amount needs to double by 2030 to over $600 billion a year to cover the necessary overhauls, according to the International Energy Agency.
Spain has asked its own investigators and European Union regulators to investigate last Monday's outage.
Tourists check into a hotel without electricity during a power outage that hit large parts of Spain, in Ronda on April 28. |
REUTERS
While the underlying issues have yet to become clear, grid operator Red Electrica said two separate incidents had triggered the massive power loss.
It follows an acceleration in renewable energy use, especially in Spain, after Russia's invasion invasion of Ukraine in February 2022 and the resulting disruption of oil and gas supplies focused EU efforts on reducing dependence on fossil fuel.
The share of renewables rose to 47% in the EU's power mix last year from 34% in 2019, while fossil fuels dropped to 29% from 39%, data from think tank Ember showed.
Spain plans to phase out coal and nuclear power. Renewable generation hit a record high at 56% of Spain's power mix in 2024.
Wind and solar projects are relatively quick to build compared with grids, which can take more than a decade.
Part of the problem is the huge sums and complexity of improving a grid over a large distance.
The European Commission has estimated Europe needs to invest $2.0-2.3 trillion in grids by 2050.
Last year, European firms invested €80 billion ($90.5 billion) in grids, up from €50 to €70 billion in previous years, analysts at Bruegel said while adding investments may need to rise to 100 billion.
Spain and Portugal's power systems are among those in Europe that lack connections to other grids that can provide back up.
Spain needs more links to France and Morocco, said Jose Luis Dominguez-Garcia from Spain's energy research center IREC in Catalunya.
Spain has only 5% of connections outside the Iberian Peninsula, he added.
As some other countries also lag, the European Commission has a target to increase interconnection to 15% by 2030, from a previous goal of 10%, meaning each EU member country should be able to import at least 15% of its power production capacity from neighboring countries.
Spain will reinforce connections with France, including a new link via the Bay of Biscay that will double the interconnection capacity between the two countries, Spain's grid Red Electrica said on Tuesday.
As solar and wind generation grows, the challenges go beyond upgrading grids to the need for backup generation.
Solar and wind farms generate direct current power, while traditional gas or nuclear plants generate alternating current.
DC power is converted to AC in inverters to standard 50 hertz frequency for European grids and use in homes and businesses. If power generation drops, the grid requires backup AC power to prevent the frequency from dropping.
In the event frequency drops, automatic safety mechanisms disconnect some generation to prevent overheating, damage to transformers or transmission lines. If too many plants drop off at the same time, the system can experience a blackout.
Before last week's outage, Spain had suffered power glitches and industry officials had repeatedly warned of grid instability.
Spain's energy officials have also said the country's plans to shut down all seven of its nuclear reactors by 2035 could put power supply at risk.
Portugal has only two backup plants — a gas and a hydro plant — able to quickly respond if the grid needs more power, Portugal's Prime Minister Luis Montenegro said last Tuesday, adding the country wants more.
In Britain, a blackout in 2019 cut power to a million customers, when a lightning strike and a second, unrelated incident lowered the frequency of the grid.
Since then, the country has invested to expand battery storage and had around 5 gigawatts of capacity installed at the end of last year, according to industry association RenewableUK. It can help balance the grid in the same way as power plants.
Europe has 10.8 GW of battery storage and it will grow to 50 GW by 2030 — much less than the required 200 GW, according to the European Association for Storage of Energy.
In Ireland, Siemens Energy has built the world's largest flywheel, which can also operate as power storage and help to stabilize the grid.