Europe’s energy transition is gridlocked. Can a €1.2 trillion investment plan come to the rescue? The EU is currently at an important moment in its energy transition. Although a global leader in climate policy, Europe’s electrification and renewable energy integration tends to lag behind other regions, constrained by an ageing and fragmented grid infrastructure.
By Eloi Borgne, Junior Policy and Research Officer
Europe’s energy transition is gridlocked. Can a €1.2 trillion investment plan come to the rescue? The EU is currently at an important moment in its energy transition. Although a global leader in climate policy, Europe’s electrification and renewable energy integration tends to lag behind other regions, constrained by an ageing and fragmented grid infrastructure.
The European Commission’s Grids Package, unveiled on the 10th of December 2025, is a direct response to this challenge. Dan Jørgensen, Commissioner for Energy, has framed the package as a “common European energy project,” for economic competitiveness, energy independence, and climate goals. The package’s ambition is to unlock the full potential of Europe’s energy infrastructure by addressing bottlenecks in permitting, financing, and regional coordination. However, as this analysis will show, the package’s approach raises important questions about governance, environmental safeguards, and the balance between centralised EU planning and national sovereignty.
Key Components of the Grids Package
The Grids Package contains several features that align well with liberal values of market efficiency, integration, and inclusive growth. It proposes a centralised, EU-led approach to energy scenario planning and the identification of cross-border interconnectors. This initiative aims to overcome the fragmentation of national energy policies, which often prioritise short-term interests over long-term EU-wide benefits. By giving the Commission a stronger role in planning and proposing projects, the package seeks to create a more integrated, efficient, and cost-effective energy market. This aligns with liberal principles of market integration and collective problem-solving, reducing the risk of protectionist energy decisions (such as countries building gas turbines instead of sharing renewable power).
Another notable provision is the proposal to redistribute benefits from renewable projects over 10MW to local communities. This measure aims to foster public support for the energy transition by tying economic incentives to local buy-in, which would reduce delays caused by social opposition. This approach not only promotes inclusive growth but also strengthens the democratic legitimacy of energy infrastructure projects. Executive Vice-President for Clean, Just and Competitive Transition, Teresa Ribera, has praised this aspect, stating that the package symbolises “an inclusive future” where citizens share in the benefits of the energy transition.
Finally, the package introduces a shift from the “first-come, first-served” to “first-ready, first-served” for grid connections, which could streamline the deployment of renewable energy projects and reduce bureaucratic delays. This change is expected to increase visibility for permitting authorities and prioritise viable projects, accelerating the energy transition. These measures reflect a liberal emphasis on efficiency, market responsiveness, and reducing regulatory barriers.
Don’t Forget the Environment
Despite its strengths, the Grids Package contains elements that could undermine its long-term sustainability. One of the more contentious aspects is the proposal to exempt grid projects from environmental impact assessments or to streamline them significantly. While accelerating grid deployment is urgent, removing environmental safeguards risks biodiversity loss and public backlash. Environmental NGOs have warned that this could create delays, legal challenges, and ultimately undermine the EU’s climate goals. The risk is that short-term gains in permitting speed could lead to long-term environmental harm and erode public trust in the energy transition, so this aspect should be handled with caution.
Be Aware of Local Realities
Furthermore, the package’s governance model, which centralises planning under the European Commission and grants it unilateral power to propose projects, raises concerns about the disconnection between EU-level decisions and national/local realities. The European Network of Transmission System Operators for Electricity (ENTSO-E) wrote that this centralisation could lead to inefficiencies, delays, and resistance, clashing with liberal principles of subsidiarity and decentralised decision-making. Without sufficient bottom-up input, EU-level planning risks imposing solutions that do not reflect local conditions or public preferences.
The Trans-Balkan Pipeline Reverse Flow Initiative
Another problematic element of the Grids Package is the Trans-Balkan Pipeline Reverse Flow Initiative, which enables US LNG imports into the EU
The Energy Highways initiative seeks to fast-track cross-border energy projects vital to completing the Energy Union, backed by strong EU political support and coordination.
Yet the pipeline undermines EU goals of independence and decarbonisation by increasing fossil gas reliance instead of prioritising electrification and renewables. Seen as a political concession, it risks delaying electricity infrastructure. While short-term LNG imports may aid security, they could expand significantly in the future.
US LNG inflows raise emissions and public backlash, with NGOs calling it a setback to phasing out Russian gas. Though it may boost regional economies and diversify supply, it reinforces geopolitical dependencies, demonstrating tensions between EU climate ambitions and energy politics.
More Can Be Done Still
While the Commissions package aligns with recommendations from my policy paper, such as accelerating permitting and modernising the grid, it does fall short on fully addressing certain areas such as smart grid digitalisation, mandating flexibility measures for Distribution System Operators (DSOs) and promoting energy communities. The proposal does mention digital innovation and cross border interconnections, it lacks however specific commitments to smart meters, dynamic pricing, and local energy initiatives, which are essential for a more responsive and inclusive energy transition.
Addressing these gaps would strengthen the package’s ability to unlock Europe’s full potential in achieving a reliable, affordable, and zero-carbon electricity future. The energy transition’s success is dependent on grids that are not just modern and interconnected, but also fair, transparent, and environmentally sound.