How can the energy sector boost European competitiveness?

Industry insiders say electrification offers ‘incredible’ opportunities for European competitiveness

Competitiveness is the buzzword that has focused the minds of policymakers across Europe over the past year.

But what do players in the energy sector think will make their industry competitive? And how will it make Europe competitive?

I travelled to Brussels to find out, and it turns out that the answers are many of the things that those players have been raising a red flag about for years.

“Competitiveness is about how fast you can connect almost anything to the system, from data centres to wind parks,” says Sabine Erlinghagen, chief executive of Siemens Grid Software, adding that, therefore, connection requests and the speed with which they are granted are a key factor.

Also vital, she says, is “affordability: if we can bring energy prices down, the competitiveness of all of Europe will go up”.

And she adds that “a stable and reliable grid is a competitive advantage”.

Innovate to compete

Andrés Acosta of LevelTen Energy equates competitiveness with innovation, yet stresses that innovation is not just about technology: “We also need contractual and market innovation to make technologies investible and because developers need that revenue certainty.

“As long as we don’t have structures that provide that certainty, we are not going to be able to deploy technologies in the right way.”

Speedy permitting; a stable grid; investor certainty: all well-voiced arguments that have now been given a fresh injection of urgency thanks to the need to be – and be seen to be – competitive.

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Electrification opportunity

However, what is new is the opportunity to become competitive via electrification.

The years since Russia’s invasion of Ukraine have reset the scope and ambition in the energy transition arena and geopolitics has made gas the unwelcome player on the field.

Therefore, the need to electrify everything that can be electrified has fresh impetus.

“Our strength for competitiveness is electricity,” says Christian Buchel, chair of France’s Union Française de l'Electricité. “And luckily, competitiveness is also very good for the climate. Especially these days when other places in the world are rediscussing if climate is a problem.”

Duncan Burt, who leads strategic growth at Reactive Technologies, says Europe has the potential to “build the ‘electro majors’ that are going to power the electric economy. And that’s not just one or two companies: it’s whole supply chains”.

“It’s an incredible opportunity… but Europe will need to move quickly.”

Watch the full video of my interviews in Brussels for more insights.