With Ireland currently holding the Presidency of the Council of the European Union until the end of 2026, Energy Policy Manager at ESB Catherine Joyce O’Caollai takes a look at why the EU matters for the Irish electricity sector and which policy areas are in focus over the course of the Presidency.
Ireland may be right at the edge of Europe geographically speaking, but our economy, society and politics are closely intertwined with those of our European neighbours. This goes for our energy system, too.
Our electricity networks are physically linked via interconnectors to Great Britain, and the Celtic Interconnector now under construction is set to provide a direct connection to France. But equally important are the links created by the European Union (EU) policy and regulatory framework, which is shaped by the EU institutions and Member States like Ireland, and which governs much of how our electricity system operates today and into the future.
EU energy policy and Ireland’s Presidency of the Council
EU policy has been hugely significant in the evolution of our energy system over the past number of decades: from reforms that have made electricity markets more competitive, to legislation that has accelerated the green transition in areas like decarbonisation, renewable energy and energy efficiency.
Decisions made at European level continue to be fundamental to the future of Ireland’s electricity system, which is why companies like ESB closely follow developments in Brussels and engage with EU stakeholders through representative organisations such as Eurelectric.
Right across Europe, governments are facing similar challenges when it comes to energy: how to accelerate the transition from fossil fuels to clean power; how to strengthen energy security; how to support customers on affordability. With Ireland currently at the helm of the six-month rotating Presidency of the Council of the EU, there is great potential to move forward on a number of policy areas that are key to shaping our energy future.
Supporting infrastructure delivery
As Europe moves away from fossil fuels, it needs to rapidly expand its clean electricity infrastructure – building more renewables and energy storage, while upgrading the grid to connect new wind and solar, and to accommodate growing electricity demand as electrification accelerates across sectors.
The European Grids Package has been designed to support these objectives, with proposals including a Directive to accelerate permit-granting for grids and delivery of trans-European energy networks. Measures on faster consenting and digitalised permitting can help reduce timeframes for deploying renewables, EV chargers and batteries. During the Irish Presidency, interinstitutional negotiations will take place on the package between the Council, the European Parliament and the Commission.
Another file to watch is the Industrial Accelerator Act, proposed by the Commission in March and intended to strengthen European competitiveness and decarbonisation by supporting low-carbon manufacturing, clean technologies and investment in strategic sectors. For the electricity sector, it will be important to get the detail right on “Made in EU” procurement requirements to avoid unintended knock-on effects that could increase costs, lengthen delivery timelines, constrain supply and add complexity to essential grid delivery. The Council and Parliament are currently developing initial positions on the file.
Accelerating electrification and energy efficiency
Policies on energy efficiency and electrification in areas like transport, industry and heating are crucial in reducing Europe’s dependence on imported fossil fuels and lowering emissions. Just weeks into the Irish Presidency, the Commission put forward the Electrification Action Plan to support these aims. It places electrification at the frontline of decarbonisation and cost competitiveness, while highlighting the need to make electricity cheaper and increase the share of clean, affordable homegrown energy.
The Commission will now start introducing measures announced in the Plan to reduce the gap between electricity and fossil fuel prices, including a proposal to reform taxes and levies to make electricity-based technologies more attractive. The plan also proposes an indicative 2040 electrification target of 46% of final energy consumption, recognising that this figure has been stuck at around 23% in the EU for a decade. The next step is an impact assessment, in advance of a firmer proposal towards the end of the Presidency.
Addressing affordability
At national and European level, energy affordability remains a key concern. Practical approaches are needed to ensure that the clean energy transition does not disproportionately burden those least able to pay. Measures can include targeted subsidies for low-income and vulnerable groups to help offset costs for households at risk of energy poverty.
Tax incentives, too, can help reduce the cost of investing in energy efficiency measures or adopting renewable technologies. Continued public investment in key infrastructure, such as upgrading electricity grids and expanding public transport, is also essential to lower overall transition costs and ensure widespread access to affordable clean energy. These measures, taken together, can help deliver a fair and inclusive transition.
In addition to ongoing work on the EU’s Multi-Annual Financial Framework (which sets out the EU’s long-term spending plans), a file to watch during Ireland’s Presidency is the legislative proposal to Future-Proof Electricity Bills. Covering network charges, taxation and grid connection management, its aim is to make electricity more affordable than fossils fuels. Under the proposal, the use of taxation measures to achieve cheaper electricity will be at the discretion of the Member State. With this file just at the beginning of its journey, negotiations are expected over the course of the next year.
Advancing a shared clean energy future
Ireland’s Presidency of the Council arrives at a critical juncture for the energy transition. With Europe still relying on imported fossil fuels for around 60% of its energy needs, action to accelerate delivery of renewables and low-carbon technologies is essential to meet climate targets and grow our energy security. This will be complemented by investment in electricity grids on an unprecedented scale, as is already happening in Ireland with the €13 billion PR6 network investment programme. The legislative work in progress at EU level over these six months will be crucial in driving forward this agenda and advancing a fair, flexible and affordable clean energy future.
Read ESB's priorities for EU energy policy during the Irish Presidency.
Read more on ESB's vision for a clean, secure energy future.