EU countries could save EUR250 billion annually by 2040 by accelerating the transition to electricity, according to a press release from France’s Schneider Electric.
“The so-called ‘energy trinity’ – the balance between affordability, security, and sustainability – remains a challenge, as high dependence on fossil fuel imports keeps prices high and delays the achievement of climate goals,” the company said.
According to a press release based on Schneider Electric’s report “Europe’s Energy Security and Competitiveness – Accelerating Electrification,” the current level of electrification in Europe is only 21% — a figure that has remained unchanged over the past decade and is 10% lower than in China, where rapid electrification is taking place. At the same time, the cost of energy for domestic consumers in the EU is EUR0.27 per kWh, in the US — EUR0.15/kWh, and in China — EUR0.08/kWh.
“This means that daily energy consumption for each EU citizen is three times more expensive than for Chinese residents,” the report’s authors concluded.
According to the document, the pace and level of electrification in different European countries vary significantly due to differences in infrastructure, policy, market maturity, and consumer behavior. In particular, some countries, such as the Scandinavian countries, have made significant progress in the electrification of transport and buildings, while others are only beginning to scale up their efforts. At the same time, Southern Europe shows higher rates of building electrification, while Western and Central Europe focus on industrial electrification and the development of prosumer initiatives.
“To remain competitive on the world stage, Europe needs to accelerate the transition to a more electrified economy,” according to Schneider Electric analysts.
The report identifies several key policy areas that need to be implemented to achieve this goal.
First and foremost, according to the authors of the document, governments need to reduce the price difference between electricity and natural gas by gradually phasing out fossil fuel subsidies and reforming the tax system to encourage the use of clean energy.
Equally important is accelerating financing — simplifying access to investment, introducing targeted incentives, especially for small and medium-sized businesses, and directing revenues from emissions trading and innovation funds to electrification projects.
The report also highlights the need to develop local markets, which involves mandatory electrification of new buildings and industrial processes, support for the rapid introduction of heat pumps and electric vehicles, and encouragement of prosumer initiatives.
In addition, an important direction is to promote local development through sustainable public procurement, accelerate standardization, and support European innovation and manufacturing—this will allow the economic and social benefits of electrification to be fully realized across the continent.
“This study is one of the most thorough analyses of Europe’s electrification potential and the policy actions needed to realise it. It emphasizes that electrification is vital — not only for achieving climate goals, but also for stimulating economic growth, energy independence, and industrial competitiveness,” said Laurent Bataille, Executive Vice President of Schneider Electric in Europe.
In his opinion, Europe must urgently overcome the stagnation of electrification, for which the relevant technologies already exist and are ready for implementation. At the same time, appropriate policy incentives and decisive business action are also needed to unlock the economic and environmental potential that EU countries need.
