EU Proposes to Lift Electricity’s Share in Energy Consumption to 46% by 2040

A draft plan from the European Commission reveals that the EU is considering setting a new electrification target: lifting electricity’s share of the bloc’s total energy consumption to 46% by 2040, roughly double the current level.

The draft is scheduled to be released on Friday. It aims to reduce Europe’s dependence on imported oil and natural gas. Hit by surging fossil fuel prices amid recent geopolitical tensions, the EU is preparing a package of measures to accelerate the shift in its energy mix. Negotiations over the draft were still ongoing within the European Commission as of Thursday, and adjustments may be made to the final text prior to publication. A European Commission spokesperson declined to comment.

At present, electricity accounts for merely 23% of the EU’s final energy consumption, a figure that has largely flatlined over the past decade. The remaining energy demand for economic activities across the bloc is still predominantly met by fossil fuels.

Reaching the 46% electricity share will require massive uptake of electric vehicles, widespread replacement of gas boilers with heat pumps in households, and faster electrification of industrial processes. Large-scale upgrades to Europe’s ageing power grid will also be necessary. The transition outlined in the draft is expected to demand hundreds of billions of euros in investment.

Some industry stakeholders argue that delivery of the plan hinges heavily on policymakers’ ability to bring down Europe’s relatively high electricity prices. Several companies note that electrifying their operations is not economically viable at existing power rates.

According to the draft, hitting the 46% electrification target by 2040 could cut the EU’s annual expenditure on fossil fuel imports by as much as €260 billion. Currently, the EU relies on imports for over 80% of its natural gas consumption and more than 90% of its oil demand.

Under the roadmap laid out in the document, following the release of the plan, the European Commission will table relevant legislative proposals in the fourth quarter of this year to enshrine the electrification target into law.