EU strategy on energy system integration

To reach our decarbonisation goals, a more flexible and decentralised energy system is needed to smoothly absorb additional renewable generation. The future energy system will be very different from today’s, relying much more on the direct use of electricity rather than fuels, and decarbonising hard-to-electrify sectors such as heavy transport and some processes in industry.

Better integration will allow for the optimisation of the energy system as a whole, across multiple energy carriers (electricity, heat, cold, gas, solid and liquid fuels), infrastructures and consumption sectors, by creating stronger links between them with the objective of delivering decarbonised, reliable and resource-efficient energy services, at the least possible cost for society. It includes a stronger focus on the electrification of demand (through electric vehicles, heat pumps and industrial processes, for example), flexibility and storage, hydrogen and heating and cooling, which represents half of the EU’s energy use.

The EU strategy, published in 2020, promotes a greater direct electrification of end-use sectors and involves various existing and emerging technologies, processes and business models, such as ICT and digitalisation, smart grids and meters and flexibility markets.

The electrification of transport is a good example of the potential for integration. At present, we know that electric vehicles connect the transport and power sectors, but also buildings, where the charging points are often located. In particular, smart and bi-directional charging will not only help reduce grid congestion, but will also contribute to the wider usage of locally generated renewable electricity and lower charging costs for users. Charging can be done at the time of the day or night when electricity prices are lowest or when renewable production is abundant, and discharging when prices are high.

Barriers and objectives

Several barriers still prevent energy system integration from fully materialising and allowing citizens and industry to embrace cleaner energy alternatives.

The cross-sectoral links in the EU’s current system need to become stronger to create the conditions to enable and encourage further integration, where different energy carriers can compete on a level playing field and use every opportunity to reduce emissions.

Such integration of the energy system is also necessary to achieve a cost-effective decarbonisation of the EU economies. It will build a more flexible, more decentralised and digital energy system, in which consumers are empowered to make energy choices.

Energy system integration will likely follow different pathways in each EU country, depending on their respective starting points and policy choices. Some of these are already reflected in the national energy and climate plans 2021-2030.

Achieving energy system integration

As part of the European Green Deal, in order to encourage this smart sector integration, the Commission presented an EU strategy for energy system integration on 8 July 2020.

Energy system integration will be facilitated by the correct and timely implementation of the Fit for 55 package, namely the implementation of the revised Renewable Energy Directive, the reform of the Electricity Market Design, the revised Energy Efficiency Directive and the revised Energy Performance of Buildings Directive.

In order to assess the progress made towards energy system integration in Europe and to identify the remaining barriers, a study was published in 2024. It analyses the electrification of transport, industry and buildings and the use of renewable energy, the uptake of clean hydrogen, the utilisation of waste heat, energy infrastructure, energy storage and digitalisation.

EU strategy on energy system integration

Barriers and objectives

Achieving energy system integration

Related links