Energy System Integration: Opportunities, challenges, barriers, and recommendations for policy-makers

Integration of the whole European energy system is key to delivering a secure and affordable transition to net zero greenhouse gas emissions by 2050. This commentary highlights the economic, environmental, and energy security benefits and challenges of integrating Europe’s energy supplies, carriers, infrastructures, and demands. Implementation of the European Union (EU) strategy for energy system integration (2020) will involve expanding electrification, digitalisation, and the use of smart grids and markets for grid flexibility services to balance electricity supplies and demands. At the same time, it will contribute to delivering the Clean Industrial Deal and hence linking climate action with competitiveness. Opportunities for energy system integration include coupling electricity, heating, cooling, and transport, but these sectors must be supported by secure information and communications technology (ICT) systems, heat and electricity storage, and demand response driven by measures such as time-of-use tariffs. Some significant challenges must be overcome, including grid congestion, risks of cyber-attacks, resistance from existing institutions and fossil-fuel-based industries as these are phased out, and social impacts on households, communities, and small businesses. For this, existing EU energy policies must be fully implemented, and energy markets must be further integrated and harmonised. Modelling studies confirm that integrated energy systems are more cost-effective and secure than independent sector-specific approaches, but financing is needed for long-term investments in energy system integration and infrastructure. Also, public funding is needed to pay for targeted support to regions affected by the energy transition, and for distributed support to individuals, communities, and small businesses across the EU that need help to adapt and replace skills that are no longer needed, and to reduce the risks of falling into energy poverty. Stable long-term energy system integration and transition policies with clearly defined targets and goals are needed, together with independent monitoring and progress reporting to build and maintain investor confidence. Engagement of citizens, local communities, and businesses is crucial to the success of an integrated energy transition, because it reduces the risks of costly delays to permitting for the construction of sustainable energy systems and infrastructure, and it can help to mobilise investments.