EU companies want to shift from fossil fuels but many lack resources shows report

An ABB survey of 850 European purchase decision-makers found almost three-quarters prioritised shifting from fossil fuels but over half need more resources for their strategies.

The transition away from fossil fuels is a priority for European energy utilities and industries alike, but there is a reality gap – the need for more investment to meet clean energy goals, according to a new survey conducted by ABB's Distribution Solutions Division.

European electrification purchase decision-makers in France, Germany, Italy, Norway and the UK were surveyed, with more than half recognising that their organisations lack the resources to meet their commitments in the energy transition.

“I would say the number prioritising their shift is a very encouraging finding but many are struggling,” said Adrian Guggisberg, Division President of Distribution Solutions at ABB, in a briefing at Enlit Europe 2024.

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The survey asked energy utilities and businesses about their energy transition drivers and risks, their views on automation and environmentally friendly technologies and their readiness to adopt regulations to reduce greenhouse gas emissions.

The survey confirmed that utilities and industrial customers face common challenges in this transition. These include controlling operational costs, managing infrastructure investments, addressing the need for a skilled workforce and implementing new solutions such as energy storage.

They also are motivated to act by new or increasing regulations supporting the energy transition and the drive to lower costs – an example being the technology change in MV switchgear with the gradual elimination in SF6, for which the European energy sector is preparing.

Increasing demand, severe weather, ageing infrastructure and renewable growth are making power supply, transmission and distribution an increasingly complex balancing act, with automation critical in the energy and industrial sectors.

Respondents also noted the need to improve cybersecurity measures as digital components and software solutions become increasingly essential to electrical equipment.

Commenting on Europe’s urgent need for electrification, Guggisberg said that while ABB is encouraged by its priority on the European agenda, significant challenges, or "elephants in the room," remain. One key issue is that many DSOs operate within regulated markets where incentives often focus on maintaining the status quo rather than enabling radical change.

“That model doesn’t work and needs to change,” he said.

He added that this restrictive model creates a chain effect, preventing the necessary investments from flowing, which can cause further supply chain constraints.

“We’re running on a narrow line here and we have to work towards the targets and timelines.”

In addition, there is the need to increase the level of investment in the grid to ensure that renewable energy sources can be fully used.

In conclusion, Guggisberg suggests three priorities for the incoming energy commissioner in Europe – to drive concrete investment plans into the power grid from all countries, to develop a common digitalisation framework long-term for countries that also drives innovation and to secure resources for all the activities, including skills development.

“These would ensure predictability, that the system is secured and that the workforce needed is available.”