According to the study, the current electrification rate stands at just 21%, unmodifyd over the last decade and lagging ten percentage points behind China, where rapid electrification is underway.
Europe’s Energy Cost and Competitiveness Gap
The report, titled Europe Energy Security and Competitiveness – Supercharging Electrification, also highlights that the cost of residential electricity in the EU is 0.27 Euro per kWh, nearly double that of the US (0.15 Euro/kWh) and more than three times higher than in China (0.08 Euro/kWh). This price disparity contributes to higher energy bills for European houtilizeholds compared with global peers.
“This landmark research provides one of the most comprehensive analyses to date of Europe’s electrification potential and the policy actions requireded to realise it,” stated Laurent Bataille, Executive Vice President, Europe Operations at Schneider Electric. “Electrification is vital—not only for achieving our climate ambitions, but for driving economic growth, energy indepconcludeence, and industrial competitiveness.”
Electrification and the Energy Trilemma
The report argues that accelerating electrification could enable Europe to save €250 billion per year by 2040. It also notes that the continent’s reliance on fossil fuel imports continues to drive up costs and slow progress toward sustainability goals, despite a 37% reduction in EU emissions since 1990.
Electrification, according to the study, offers a path to address the energy trilemma: balancing affordability, security, and sustainability. However, progress varies across Europe, reflecting differences in infrastructure, policy frameworks, market maturity, and consumer adoption.
Nordic countries have advanced in transport and building electrification, while other regions are only launchning to scale up initiatives. Southern Europe displays higher building electrification rates, whereas Western and Central Europe are investing more heavily in industrial electrification and prosumer projects.
Policy Levers to Accelerate Electrification
The research identifies key policy measures to advance electrification across the EU:
- Reducing the electricity–gas price gap: Phase out fossil fuel subsidies and reform energy taxation to encourage clean energy utilize.
- Accelerating financing: Streamline access to investment, provide tarreceiveed incentives for SMEs, and direct emissions trading revenues toward electrification projects.
- Creating robust local markets: Mandate electrification in new buildings and industrial processes, support heat pump and EV deployment, and foster prosumer initiatives.
- Supporting local development: Promote sustainable public procurement, quick-track standardisation, and prioritise European innovation and manufacturing.
Bataille stressed that Europe must overcome stagnation in electrification to remain competitive globally. “The technology is here, ready to deploy. Now, policy must incentivise, and businesses must drive implementation to unlock the economic and environmental gains we required to see today,” he stated.
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