EU countries scale back plan to fund power grids

Governments have cut back the European Union's proposal to spend national ‌funds on the bloc's energy infrastructure after Sweden threatened to restrict power exports over the plan, an internal negotiating document seen by Reuters showed.

The spat concerns a proposed EU law to raise funds for large cross-country energy infrastructure projects, ​like interconnectors, which are needed to integrate more renewable energy into the network and meet ​rising power demand from data centres and other sources.

The European Commission proposed in December ⁠that 25% of unused congestion revenues collected by power grid operators would be earmarked to fund ​EU-backed projects.
EU countries negotiating the legal proposal have cut that back, so that national operators would not ​have to hand over any congestion revenues collected from power trade within their country, their latest compromise proposal showed.

The draft proposal would also cut the share of cross-border congestion income earmarked for EU-backed projects to 10%, which would rise ​gradually to 25% by 2030.

The plans would scale back the available funding, which raises questions about where ​cash for new cross-border power projects will be found. Some of Europe's biggest planned power interconnector projects have stalled in ‌recent ⁠years due to a lack of funds and other concerns.

The EU estimates that €1.2 trillion ($1.4 trillion) in power grid investments are needed by 2040.


-Reuters