The European Commission (EC) last week published its long-awaited “Grids Package”, which aims to overcome the numerous challenges the bloc is facing when it comes to delivering on its net-zero ambitions with regards to electricity grids.

Stemming from imported fossil fuel dependence and lack of interconnectivity across the bloc, the challenges facing the EU are expected to proliferate further without immediate action.

It’s hoped that the new package of measures, which focuses on five key areas, will lead to “cheaper clean energy, reduced dependence on imported fossil fuels, secure supply and protection against price shocks,” said Teresa Ribera, executive vice-president for clean, just and competitive transition at the EC.

‘First ready, first served’ approach

Described by the CEO of SolarPower Europe, Walburga Hemetsberger, as the “highlight of the package,” the EC has issued new guidance for member states to achieve both “efficient and timely grid connections”.

With the interconnection process having not been designed with the green revolution in mind, the huge increase in demand for renewable energy resources has put severe administrative strain on grid operators across the continent.

This has led to at least 16 member states encountering delays in connecting projects to the grid, according to a recent study from the Fraunhofer Institute for Systems and Innovation Research – slowing down not only the clean energy transition, but also economic growth.

Despite acknowledging “forward-thinking” buildout as the key to combatting constrained grid availability, the EU has compiled a “toolbox” of measures which it says will “prevent, optimise and tackle” lengthy grid delays.

Most notably, the commission recommends that moving forward, grid operators abandon the principle of “first-come, first served” and move to a milestone based approach together with the “first-ready, first-served” principle.

Those familiar with the British energy market will recognise this as being a very similar approach adopted by the National Energy System Operator (NESO), which recently overhauled its hugely oversubscribed interconnections queue.

As part of its recommendation, the EC asks member states to take into account the maturity of connection requests through a series of metrics, which could include asking developers to provide proof of financing, land rights or completing progress in planning/permitting.

Additionally, the EC recommends network operators regularly assess projects against these milestones and, in order to avoid congestion, remove any developments which do not reach these milestones as part of a “use-it or lose-it” approach.

Flexible interconnection agreements, whereby grid users agree to only use the connection when capacity is available, were also recommended by the EC.

As with any new framework or policy surrounding the energy market, the EC calls for network operators to increase the availability, granularity and digitisation of data that is available to the industry.

These recommendations from the EC have been celebrated by many industry stakeholders, who have been calling for such amendments for some time. In response to a consultation on the Grids Package in August 2025, advocacy group Energy Storage Europe recommended several of the changes which have since been recommended, including a shift in approach to “first-ready, first served”.

Hemetsberger of SolarPower Europe said the new grid connections guidance “hit the nail on the head” and will “help Europe to make better use of the grid hardware that [it] has”.

The CEO also commended the EC on its targeted permitting legislation, which they said could increase the operational capacity of energy storage by a factor of 10 by the end of the decade.

CfD recommendations

With two-way contracts for difference (2w-CFDs) now being mandatory across the bloc, the EC also published broad guidance on the best way to design such agreements for member states to “reap the benefits”. This guidance on CFDs could not be more timely, after a series of recent high-profile European auctions which failed to attract any bidders.

The EC highlighted the importance of not incentivising developers to produce electricity when prices were negative, whilst maintaining incentives in other markets such as day-ahead.

The EC’s recommendations also focused on the combination of 2w-CFDs with PPAs, which is something which many larger projects across Europe are engaging in nowadays.

With overlapping revenue streams, the EC stressed the importance of each source of income not undermining the other, with 2w-CFDs providing state-backed funding to reduce costs, whilst PPAs provide commercial price stability.

Industry criticism

The European Network of Transmission System Operators for Electricity (ENTSO-E) also commended the change in approach; however, they were critical over some of the EC’s proposals.

In particular, they expressed concern over the EC taking into account the plans of individual member states via complementary bottom-up studies. ENTSO-E believes this could create a disconnect between European-wide planning when compared to the realities and security concerns of each nation.

SolarPower Europe also criticised the EC for a lack of focus on distribution network operators, which they believe could enable a reduction in grid strain by ensuring energy is charged and discharged from the grid at the most optimal times.

The EC has also been heavily criticised by environmental advocacy groups over the publication of its Energy Highways Initiative, which was published alongside the grids package and identifies eight cross-border energy infrastructure projects in need of both political and financial support.

Climate Action Network Europe (CAN Europe) pointed to one of these projects, known as the Trans-Balkan Pipeline (TBP), as particularly problematic with its role in enabling the flow of fossil fuels from Greek import terminals to Ukrainian storage sites.