On Wednesday, European Commission President, Ursula von der Leyen, delivered her annual State of the European Union (SOTEU) address in front of the European Parliament in Strasbourg. This set-piece speech is the moment each year when the Commission takes stock of progress, sets the political tone, and outlines priorities for the months ahead.
For the electricity sector, four announcements stood out: a recommitment to Europe’s 2040 climate ambition, the recognition of imported fossil fuels as the structural cause of higher energy prices, the launch of an Energy Highways initiative to remove grid bottlenecks, and a renewed push to finish the internal energy market by 2028.
In this week’s Friday Feature, we take a closer look at what the SOTEU means for the energy sector – and what Eurelectric thinks about it.
Confirming commitments
“The science is crystal clear. And the economic and security case is equally compelling,” von der Leyen declared as she opened the energy and climate chapter of her speech. And just in that line, she recommitted to the three pillars of the clean energy transition.
The science. The science refers to the impact assessment and scientific advice that underpin the 2040 climate target. Proposed by the Commission in July, the 90% cut in net emissions has since then been the subject of heated debate. While Patriots for Europe (PfE) climate rapporteur, Ondřej Knotek’s Parliament report rejected the entire proposal, this week, Members of the European Parliament (MEPs) from the European People’s Party (EPP) debated on the use of international carbon credits. Calling on science as the foundation, President von der Leyen reaffirmed the EU’s commitment to an evidence based, crucial 2040 target. The science, she insisted, leaves no room for backtracking.
The economic case. Mentioning the economic case, President von der Leyen revived the guiding principle of her first Commission mandate: decarbonise now, save later. She framed climate action not as a cost but as Europe’s competitiveness strategy. The argument is familiar but urgent: early decarbonisation avoids locking in fossil spending, reduces cumulative emissions and makes full use of clean technologies before rising temperatures make them harder to deploy. At stake is Europe’s industrial future. As the now one year old Draghi report warned, high energy prices are squeezing Europe’s competitiveness against the US and China. By legitimising the 2040 target this way, President von der Leyen tied climate ambition directly to Europe’s reindustrialisation drive – with batteries, steel and circular production placed at the centre.
Security. Lastly, calling the security case compelling, President von der Leyen drew perhaps her clearest political lines: dependence on fossil imports is why Europeans face high energy bills and why Europe remains exposed to external shocks. The message resonated in a Parliament still divided over the pace of the fossil fuel phase-out. Just months after the Commission proposed a full ban on Russian oil and gas imports by 2027, President von der Leyen doubled down in Strasbourg: “It is time to get rid of dirty Russian fossil fuels.” For Eurelectric, this echoed a long-standing position – that energy independence, relies on homegrown, decarbonised electricity.
Bringing new initiatives
But ambition is only as strong as the infrastructure that carries it. Alongside her support for the 2040 target and homegrown clean energy, President von der Leyen announced new measures to reinforce Europe’s grids.
The headline initiative is Energy Highways: a plan to remove eight cross-border bottlenecks – from the Øresund Strait between Denmark and Sweden, to the Sicilian Canal – by bringing governments and utilities together to tackle them “one by one.” “We will bring governments and utilities together, to address all outstanding issues. Because Europeans need affordable energy right now.”
She also reaffirmed the expected Grids Package, designed to speed up investment and permitting for interconnectors. The urgency is clear. Nearly a third of Europe’s grid infrastructure is more than 40 years old. Modernising it will require €67 billion every year until 2050 in distribution grids alone. Smarter use of existing networks could reduce that figure to €55 billion – but only if bottlenecks are cleared.
Lastly, von der Leyen set a 2028 deadline for the completion of the internal market. Its finalisation, via a Single Market Roadmap, would further integrate energy markets across the EU and ease regional variations in energy prices while bring costs down for consumers and industry alike.
Encouraging signals
For Eurelectric, the signals from Strasbourg go in the right direction. They echo priorities we have consistently defended: replacing Russian fossil fuels with homegrown electricity, boosting demand through electrification and building the grids that allow clean power to flow where it is needed. Eurelectric’s Secretary General, Kristian Ruby, underlined:
“Replacing Russian fossil fuels with homegrown electricity is the key to greater energy security for Europe – and ultimately also lower prices. To sustain investment in clean power generation, the EU must boost power demand through electrification – and ensure that clean power can flow seamlessly to where it is needed most. Therefore, we welcome the Energy Highways initiative. Tackling bottlenecks with stronger interconnections and faster permitting is essential to deliver affordable, secure and homegrown energy for Europe’s citizens and industries.”
Now we need implementation…
This year’s SOTEU was light on new proposals but heavy on direction. Staying the course on climate, cutting dependence on Russian fuels, and strengthening Europe’s grids form a coherent storyline: independence through electrification.
The next steps will be decisive. The Commission will table the Energy Highways list, the Grids Package and the Industrial Accelerator Act in the months ahead. Eurelectric will stay engaged to make sure the electricity sector – the one that must deliver – is at the centre of this agenda.
This blog post was originally published as part of Eurelectric’s LinkedIn Friday Features. Subscribe here to stay updated.
Disclaimer: This article is for communication purposes only and may not reflect Eurelectric positions. Any positions taken in this article shall not be attributable to Eurelectric’s official positioning. Official Eurelectric positions are reflected only in position papers published here.