Energy Transition Troubles: Are European Countries Missing Their Targets?

How do European countries’ individual efforts compare in regards to their energy transition? The 2nd Energy Transition Readiness Index from Eaton and REA investigates which have managed to implement sustainable technologies and which are lagging behind.

Europe has set itself ambitious goals to limit the effects of climate change. It is questionable, however, whether these targets will be sufficient to prevent or at least minimize further damage. In any case, a vigorous expansion of renewable energies combined with a flexible electricity market will be crucial for a successful transition. The second edition of the Energy Transition Readiness Index (ETRI) from the UK-based Association for Renewable Energy and Clean Technology (REA), in collaboration with Eaton, examines the status quo in twelve European countries: Denmark, France, Finland, Germany, Italy, Ireland, the Netherlands, Norway, Spain, Sweden, Switzerland and the United Kingdom. Here are the most important results for main European markets:

UK, France and Italy lagging behind

On the scale depicting the general status of the energy transition, the UK and France scored a three, while Italy only received a two out of five. Nordic countries such as Finland, Norway and Sweden each received full points. Sweden and especially Norway, for example, stand out in particular for their high share of renewable energy in electricity consumption at 71 and 111 percent respectively. In comparison, the results in the United Kingdom, Italy (both 35 percent) and France (22 percent) are at the lower end of the spectrum.

Nevertheless, France has promised a 40 percent, the UK a 50 percent and Italy even a 55 percent renewable output by 2030, according to current targets. To achieve this, additional renewable energy must be produced: 52, 66 and 89 terawatt hours, respectively. This is an ambitious goal: although the broad consensus is in favor of transitioning energy sources both in the UK and France, the implementation of political and regulatory changes involves lengthy, complex consultations. Additionally, France still heavily relies on nuclear capacities, which is decidedly slowing down the progression of renewable energies, while Italy suffers from a lack of consensus and market players, due to regional differences.

Further Flexibility Needed

Norway, which is generally regarded as a role model for energy transition, has one major advantage: its virtually inexhaustible hydropower. Other European countries do not have the same access to natural resources; therefore, they must seek other solutions. In the UK, France and Italy this primarily means relying on wind and solar power. As abovementioned, the UK and France are already working to implement these renewable energies and plan to build on their achievements. Wind and solar are and will remain vital energy sources well into the future, although there is still a lot to be done to ensure that European countries like, the UK, France and Italy can survive without coal or other fossil fuels long term.

In this regard, ETRI recognizes the need for more resources to expand the flexibility of the electricity market and achieve energy transition goals. Decentralized flexible technologies will play an increasingly important role in this process. Eaton wants to use this opportunity to promote their “Everything as a Grid” approach: Among other things, this involves battery storage strategies for companies or even private households. However, these investments also need to make sense financially and a flexible market to help them prosper. France (76 percent) and especially the UK (46 percent) have yet to expand smart meter penetration to a satisfactory level. Italy has managed to surpass them with a comparably high 99 percent penetration rate. Broadening the rollout would be a good basis for flexible electricity prices and would simultaneously encourage investment in storage.

Furthermore, much can still be achieved in the field of e-mobility: In 2020, the penetration of electric vehicles in the UK, France and Italy was only one percent, putting them at a similar level to most other countries. Only Norway has an exceptionally high rate, with 11.8 percent. However, the aim is not just to increase the number of electric cars, but to also promote bidirectional-charging technologies. This way, unused vehicles can also support stabilizing the grid and making it more flexible.?

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