The Benefits of Investing in Electricity Transmission: A Case Study of Northern Europe

Abstract

Electricity trading can bring down the costs of the EU’s transition to a competitive low-carbon economy, in particular by facilitating the integration of renewable energy from variable sources. This CEPS Special Report finds, however, that insufficient grid infrastructure and regulatory obstacles prevent the trading potential from being fully realized in northern Europe. While acknowledging that many inter-connector projects are under development, it identifies various barriers that are precluding the grid roll-out from taking place on time. The European Commission’s energy infrastructure package is an important step forward to overcome these barriers, but the authors warn that the scale and urgency of the infrastructure challenge call for significant further progress.

Keywords: EU, electricity trading, low-carbon, renewable energy, European Commission, infrastructure