Ireland will need 'to invest €1.1bn a year to strengthen power grid'

Brussels-based business group Eurelectric said EU countries would have to double spending on their power grids if they are to reach their mandated targets of net-zero emissions by 2050

Ireland faces injecting a comparatively large investment of €1.1bn each year from 2030 in strengthening its power grid to cater for increased electricity demand and to facilitate wind and solar power, an EU-wide study from business group Eurelectric suggests. 

The Brussels-based group also said EU countries would have to double spending on their power grids if they are to reach their mandated targets of net-zero emissions by 2050. 

"Distribution grid investments should increase from an average €33bn to €67bn per year from 2025 to 2050, roughly 20% of what the EU spent on fossil fuel imports in 2023," Eurelectric's 'Grids for Speed' study said. 

"Getting the grid up to speed will create more than two million jobs, bring greater energy savings and deliver more reliable power supply, while accelerating the decarbonisation of Europe’s economy," it said. 

Eurelectic said good planning could ultimately reduce the EU-wide investment bill of €67bn to €55bn.

"Failure to achieve such investments would jeopardise 74% of prospective connections in key decarbonisation technologies such as electric vehicles, heat pumps and renewables," according to the study. 

The study suggests Ireland will need to spend €1.1bn a year on its grid from 2030 — a comparatively large amount in terms of population compared with many other EU countries. 

The investment bill compares with €1bn for Greece, Portugal's €800m, Germany's €17.7bn, France's €5.4bn, and the €10.1bn annual investment bill for Italy, according to Eurelectric. 

It said France, Germany, and Italy represent 50% of the total required investment for all EU countries through to 2050, which "is higher than their share of energy consumption, but similar to their GDP". However, "investment per capita, is highest in Norway, Denmark and the Netherlands", according to the report. 

Like many EU countries, electricity demand is expected to rise in Ireland from the construction and transport sectors after 2030, but demand from industry is forecast to level off. Total demand for electricity in Ireland, like elsewhere in Europe, is expected to rise sharply through 2050. 

Power output from renewable sources, including wind and solar, will increase sharply in Ireland and in other EU countries from 2030, according to the study.   

"Futureproofing the grid also depends on the supply chain’s capability to scale. Even if the necessary investments are met, current shortages of copper, a talent deficit, extended manufacturing lead times and transformers’ costs can hamper infrastructure development," Eurelectric said. 

"Such bottlenecks must be rapidly addressed through strategic planning, enhanced collaboration between European policymakers and industries as well as new training initiatives to streamline education certificates and ensure a skilled workforce," according to the business group. 

"Eurelectric calls on policymakers both at national and regional level to secure grid investments, strengthen supply chains and unleash the societal benefits of Grids for Speed," it said.