15 August 2013 – A rising demand for electricity coupled with environmental concerns across Europe is leading countries to look for more diverse energy sources, which will in turn boost investment in their transmission and distribution (T&D) infrastructure, according to research and consulting firm GlobalData.

The company’s latest report states that key European countries, including Germany, France, UK, Norway, Italy, Ireland and France, will spend substantial sums on grid expansion and upgrade programs to increase security of electricity supply, deploy smart grid technology and accommodate new sources of power generation – particularly renewables.

Shivanshu Agnihotri, senior analyst at GlobalData, says, “Renewable energy accounted for around 70% of the total power generation capacity additions made in the EU in 2012, and further additions are being introduced as a result of EU targets aimed at reducing greenhouse gas emissions and increasing the share of renewables total energy consumption by 2020.”

According to the report, European T&D grids are characterised by issues related to network congestion and the integration of distributed energy resources. Agnihotri continues, “The aging nature of the T&D networks in Europe has raised concerns regarding the stability of the electricity supply and has prompted a number of nations to frame policies for the incorporation of efficient technologies into the grid.”

The need to increase cross-border grid interconnections will be another boost to the European T&D market, as it could lead to competition in the power market and the potential reduction of power prices. By providing a broader generation base, interconnections can improve energy supply security and reduce the need for the additional construction of power generation capacity.