RE-Source welcomes the recognition that grids are the backbone of the energy transition and industry decarbonisation. Corporates want to play their part in the transition by procuring renewable energy via tools like renewable power purchase agreements (PPAs). Corporate energy procurement, like PPAs, adds new wind and solar power plants to the grid, which benefits the wider society.
1500 GW of solar and wind projects stuck in the grid connection queue globally
However, corporate energy buyers currently face increasingly slow connections to the grid and face uncertainty in how their grid access will be granted. BNEF reports on 1500 GW of solar and wind projects stuck in the grid connection queue. Renewables curtailment also means lower effective load factors which means corporates need to contract more renewables projects to meet their energy needs. This can be significantly disruptive for corporate decarbonisation strategies as they cannot use the green electricity as planned.
Did you miss that? „Enhance the grid’s pivotal role in enabling decarbonisation“
Corporate renewable energy buyers welcome the EU Action Plan for Grids and the ambition to scale-up the use of renewable energies and emphasise:The importance of boosting power grid investments and expansion. Anticipatory investments in grid projects and long term planning are needed to accelerate the uptake of renewables by corporate offtakers; The significance of streamlining processes to ensure timely grid connections; and Their eagerness to support the implementation of the EU Action Plan for Grids, ensuring a meaningful engagement that will contribute to resilient and efficient future-proofed energy system. 2023 has been a record year for PPAs: so far this year around 8GW of new renewables capacity has been contracted by corporate energy buyers. PPAs are a key route to market for renewable energy but outdated grid infrastructure hinders progress. Around EUR 584 billion of investment in the electricity grid will be required in the lead up to 2030.
Unlock greater investments in new wind and solar farms also via PPAs
With the Action Plan in place, it is important to now shift to swift action to ensure prompt and reliable grid connections. Implementation of the new EU approach can unlock greater investments in new wind and solar farms, financed by corporate energy buyers via tools like PPAs; as well as accelerate industry decarbonisation. Strengthened efforts to make the grid fit-for-55 will unlock PPAs and customer flexibility, key components of the EU’s Electricity Market Design.
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"The grid connection requests are massive in Greece where we operate. This is leading to significant curtailments of renewables which could be decarbonising industry", Nick Keramidas, Executive Director EU Affairs & Regulatory Advocacy at aluminium producer Mytilineos says.
Turn ambition into action
"The EU Action Plan for Grids needs to turn ambition into action. Getting the grids right will remove this as a bottleneck to the energy transition and industry decarbonisation. Particularly for consumers with large energy loads, ramping up investments in grids and deploying scalable solutions, supported by the Electricity Market Design reform, is essential for the development of the PPA market and Europe’s energy system transformation“, Annie Scanlan, RE-Source Policy & Impact Director, underlines. (hcn)
