European Union member states have agreed the Council’s negotiating position on the European Grids Package, marking a significant step forward in the bloc’s drive to accelerate electrification and achieve climate neutrality.
The legislative package, which comprises a revision of the Trans-European Energy Infrastructure (TEN-E) regulation and a new Permitting Directive, addresses the critical need to modernise and scale up Europe’s energy networks. The Commission originally proposed the framework in December 2025 to tackle poor interconnectivity between member states and lower volatile energy prices.
The Council’s agreed position focuses on three core pillars: cohesive network planning, innovative funding for cross-border interconnectors, and aggressive permitting reform.
The Council has backed a common framework for development planning across the electricity, hydrogen, and gas sectors. This will rely on a central scenario developed by the European Commission, using direct input from member states to target long-term infrastructure bottlenecks. The planning model will explicitly factor in national climate plans, regional specificities, and wholesale price disparities, supported by mandatory sensitivity analyses every two years to adjust to market shifts.
In a key financial compromise, member states agreed to reinvest a portion of unspent congestion income — revenue generated from grid bottlenecks between different trading bidding zones — directly into cross-border projects.
This funding rule will exclude income from internal domestic bidding borders or funds amassed before the regulation takes effect. The allocation will follow a phased annual increase of 5 percentage points, starting at 10% on 1 January 2028 and rising to 25% by 2031. Any funds left unspent after eight years will revert to member states under existing EU electricity market rules.
In response to rising physical and cyber threats to energy infrastructure, ministers established a new priority project category dedicated specifically to grid security and resilience. The designation will unlock emergency funding for critical components required for rapid repairs to electricity interconnectors.
To eliminate bureaucratic delays, energy ministers endorsed a radical streamlining of the planning process. Key measures include:
- The mandatory creation of digital portals for simplified applications.
- The legal designation of electricity and renewable energy projects as being of “overriding public interest”, giving them immediate priority.
- An optional “tacit approval” mechanism, where a lack of timely response from authorities during intermediary planning stages is legally treated as consent.
- A commitment to avoid banning renewable developments across large geographic areas.
The framework also introduces measures for community engagement, promoting independent facilitators to lead local dialogue and establishing benefit-sharing schemes for communities situated near new infrastructure projects.
The Council, currently operating under the Irish presidency, will enter negotiations with the European Parliament as soon as the co-legislators finalise their stance, with the aim of securing a final agreement before the end of 2026.
