Are the European Union’s Grids Finally Getting an Update with Endesa’s €8.9 Billion Investment in Networks and Renewables?

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By Sam Torbet | 4Q 2023 | IN-7155

Are the European Union’s Grids Finally Getting an Update with Endesa’s €8.9 Billion Investment in Networks and Renewables?

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Endesa's Investment and What It Hopes to Achieve

NEWS


Endesa (a Spanish-owned company) unveiled plans to invest €8.9 billion between 2024 to 2026 toward distribution networks and renewable generation. The investment is earmarked for strengthening and expanding Endesa's networks and increasing its renewable energy capacity. A considerable portion of the funds will be dedicated to upgrading and modernizing the existing energy infrastructure, ensuring a more efficient and reliable energy supply. Simultaneously, Endesa aims to significantly boost its renewable energy portfolio, aligning with the global push toward cleaner energy sources. This kind of investment will become more common over the next few years, as companies and organizations cry out for proper grid development.

The Shift to Greener Grids Is Happening Now

IMPACT


Aside from the usual impact this kind of investment typically brings—job creation and economic stimulation—this hopefully marks the start of updating old grid infrastructure. The green energy transition is well established and a known goal for everyone on this planet, but with old grid systems designed for a centralized network, they appear to be dragging their heels. This is due to various reasons, including regulation, improper investment, and a lack of expertise and knowledge on how to effectively manage a more complex and connected system. Endesa’s investment is just one small step in the right direction, allowing major players to see what they can expect to encounter when their time comes to update the grid.

A secondary impact of the investment will be the introduction of more renewables into Endesa’s portfolio. While it seems like every day there is another announcement of a renewable project, the real key will be seeing if it is just simply renewable technology or if they will take the lead, install newer technology such as a Battery Energy Storage System (BESS) to smooth out the additional capacity to the grid. Or how will they tackle adhering to expected EU regulations curbing certain emissions?

What Action to Take to Stay Ahead of the Herd?

RECOMMENDATIONS


There are two main recommendations to take away from Endesa's strategic move that can provide valuable insights and recommendations for enterprises operating in various sectors:

  1. Adopting Energy Independence Should Be a Serious Consideration: This investment in the grid does not mean that the grid will be reliable and flexible in the future. If anything, now is the time to consider independence from the grid with on-site generation or a BESS. Becoming independent from the grid and utilities can provide numerous advantages, but for this ABI insight, the major concern is that this investment into the EU’s grid is largely overdue and may not be enough with the ever-increasing electrification of businesses.
  2. Collaborate for a Sustainable Future: The energy transition requires collaboration between businesses, governments, and other stakeholders. Endesa's investment demonstrates the impact of collaboration in driving sustainable practices. As suggested earlier, this will not be the only investment in updating grid infrastructure and renewable generation. This presents an attractive opportunity for enterprises wishing to continue their commitment to sustainable practices, but may not want to foot the entire bill with little to no news coverage. Developing intimate relationships will separate which businesses and locations will receive this investment.

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