EU Plans to Boost Electricity Use in Energy Mix by 2040

The European Union intends to propose a new target to raise the share of electricity in its overall energy consumption by 2040. This initiative is part of a wider plan to reduce oil and gas usage and to strengthen the market for clean technologies within the bloc, according to a draft document from the European Commission cited by Bloomberg.

The European Commission, the EU’s executive branch, is scheduled to unveil this plan on July 17. Subsequently, it will seek to incorporate the “electrification” target into legislation within the post-2030 energy framework during the last quarter of the year. The draft document indicates that the target will be expressed as a percentage of energy consumption by 2040, though this percentage has not yet been specified.

Clean Electricity as a Strategic Focus

Brussels is betting that increasing reliance on locally produced electricity from clean sources will not only advance climate objectives but also enhance European energy security. The Russian war exposed the continent's vulnerability due to its dependence on gas imports, and recent Middle East crises have added further risks to global energy markets.

The draft, partially revealed by Bloomberg, suggests that accelerating electrification could enable Europe to replace two-thirds of its gas demand, halve oil consumption, and reduce fossil fuel import bills by approximately 200 billion euros (about 228 billion dollars) by the end of the next decade. This reduction could also help contain high energy prices that are currently affecting the competitiveness of European companies.

This plan aligns with a broader climate goal adopted by the EU in March, which mandates a 90% reduction in net greenhouse gas emissions by 2040 compared to 1990 levels, as a step towards achieving climate neutrality by 2050.

Electricity's Current Role and Future Targets

The European Commission notes that electricity currently accounts for only 23% of the EU’s final energy consumption, despite renewable energy sources making up 47.5% of total electricity consumed in 2024. The EU’s affordable energy plan and the clean industrial deal aim to raise electricity’s share in final energy consumption to 32% by 2030.

Eurostat data shows that in 2024, 48% of electricity generated in the EU came from renewable sources, 23% from nuclear power plants, and 28% from fossil fuels. This provides Brussels with a low-carbon electricity production base that it seeks to expand for use in transportation, buildings, and industry.

Reducing Import Dependence

The electrification plan also reflects the EU’s effort to reduce external energy dependence. In 2024, the EU’s energy import dependency rate was 57%, meaning that roughly 60% of its energy needs were met through net imports.

Oil and petroleum products represented the largest share of the EU’s energy imports at 67%, followed by natural gas imports at 24%. Within the EU’s final energy consumption in 2024, petroleum products accounted for 37%, electricity for 23%, and natural and manufactured gas for 20%. This explains the draft’s focus on replacing fossil fuels with electricity in everyday and industrial uses.

Sector-Specific Electrification Goals

The plan targets sectors with the highest fossil fuel dependence. In transportation, the European Commission aims to improve access to electric vehicle charging infrastructure, accelerate electrification of heavy vehicles, and encourage ports to become clean energy hubs. In industry, Brussels plans to use funds linked to carbon markets to promote the adoption of clean electricity by companies.

Regarding buildings, the Commission is considering measures to stimulate public demand for heat pumps. This is crucial since buildings account for about 40% of the EU’s energy consumption, more than half of its gas use, and 35% of energy-related emissions.

Challenges to Implementation

The plan faces significant obstacles, including initial transition costs, upgrading electricity grids, and expanding production and storage capacities. The Commission has estimated that European electricity grids require investments of 584 billion euros (666 billion dollars) during the current decade. It also notes that approximately 40% of distribution networks in Europe are over 40 years old and need modernization.

The Commission expects electricity consumption in the EU to rise by about 60% by 2030, driven by growth in clean mobility, electric heating and cooling, industrial electrification, and low-carbon hydrogen production. This makes grid modernization essential to transform the electrification target from a policy document into an actual economic transition in Europe.