EU power grid investment set to hit €48B by 2027 as renewables and storage surge

Investment in electricity distribution grids across the EU and Norway could reach €48 billion by 2027 as electrification and renewable energy deployment accelerate, according to sector representative Eurelectric’s “Power Barometer 2026” report.

Distribution system operators’ investment rose from €24 billion in 2021 to €36 billion in 2024 and is expected to grow by an average 12.5% annually, nearly doubling over six years.

Eurelectric said grid operators are directing record levels of capital toward infrastructure needed to support electrification and connect growing volumes of renewable generation.

However, permitting delays, slow cost recovery, regulatory uncertainty, supply-chain bottlenecks and shortages of skilled workers could delay the rollout of new infrastructure, it added.

– Connection queues grow

The need for additional grid capacity is also reflected in growing connection queues for renewable and battery storage projects.

Italy has 348 gigawatts (GW) of variable renewable projects awaiting grid connection, nearly six times its currently installed variable renewable capacity.

The figure partly reflects transmission system operator Terna’s methodology, which records all submitted requests regardless of their likelihood of being completed.

Battery storage connection requests are also rising sharply, with Germany recording around 480 GW in the queue and Italy reporting 277 GW at transmission level.

Eurelectric said only a small share of projects in connection queues is ultimately expected to become operational.

– Battery storage capacity more than doubles

Operational utility-scale battery storage capacity in the EU more than doubled in 2025, reaching 11.2 GW in early 2026.

Germany led the bloc with 2.9 GW of operational battery capacity, while more than 10 GW of additional capacity is expected to come online in the near term.

The EU needs more than 450 GW of additional renewable capacity by 2030 to meet its targets.

Wind and solar together accounted for 30% of EU electricity generation for the first time in 2025, while power-sector emissions intensity fell to a record-low 182 grams of carbon dioxide per kilowatt-hour.

– Hormuz closure sends gas prices higher

The report also highlighted renewed pressure from global fossil-fuel markets in 2026.

The closure of the Strait of Hormuz pushed Dutch TTF natural gas prices to roughly double, with higher gas costs feeding into electricity prices when gas-fired power plants set the marginal market price.

Despite the shock, European wholesale electricity prices remained well below the peaks seen during the 2022 energy crisis, which Eurelectric linked to higher clean power generation and greater system flexibility.

The report also noted that Qatar supplied only around 12 billion cubic meters of gas directly to Europe in 2025, less than 4% of total EU gas imports.

However, when the Iran crisis disrupted Qatari LNG exports in early 2026, TTF prices rose by more than 70% within days, showing Europe’s exposure to global LNG supply shocks even when its direct physical dependence on Hormuz-linked gas is limited.

• EU and Norway could reach €48 billion by 2027
• Eurelectric said grid operators