Faster licensing for cross-border interconnection projects, such as those needed by the SE Europe region, central planning that will take into account the needs of the bloc and not each country separately, and securing additional funds to cover part of the huge investment needs in the coming years.
This is the hallmark of the compromise agreement around the famous “European Grids Package” (European Grids Package), which after three years of disagreements and strong confrontations was reached on Friday in Luxembourg by the ministers of the “27”, with the final text being of strong Greek interest.
Both because the text revising the Regulation on Trans-European Networks (TEN-E) as well as the new Licensing Directive adopts proposals that the country has been advocating since 2023, chief among them the need for new investments in the aging networks -which the bloc so badly needs for its energy security- to be coordinated centrally by the EU instead of being determined, as today, by the priorities of each country, and because emphasis is placed on facilitating projects that connect the “peripheral edges” of the European bloc, such as SE Europe.
In practice, the package creates a more favorable environment for projects of Greek interest - whether they pass through Greece as interconnections with the Eastern Mediterranean and the Western Balkans, or strengthen its position as an energy hub - to be licensed faster (today’s timelines are 5-10 years), so that they are planned centrally and gain easier access to EU financing tools.
* In the case, for example, of the plan for the “Green Aegean” electricity interconnection, which ADMIE has been promoting for years for electricity exports from Greece to Germany, now with the new framework the discussion about the project enters a European basis. A direction that it seems the Greek side will also exploit, as a person with knowledge of the processes comments, instead of the Greek Operator trying to convince its Austrian and German counterparts of the project’s viability.
* The same rationale also concerns the Greece - Egypt cable (GREGY), which with the new framework also escapes the narrow bilateral level of Athens-Cairo and enters a more European basis.
* If, on the other hand, the tripling of the transmission capacity of Greece - Italy from 500 MW to 1,500 MW had not been agreed, and the discussion had been conducted at a European level and not between the two countries, it might have been possible to increase capacity further. Something that may perhaps be raised at a later stage.
Modifying several of the provisions of the original package of December 2025, where the Commission did estimate the required investments in electricity networks until 2040 at 1.2 trillion euros, while however referring the financing to the further activation of member states and the private sector, Friday’s text includes two substantial changes.
Both are the result of generous compromises and after major clashes and plenty of backstage maneuvering in recent months with powerful countries such as Sweden, Finland, France and Germany, which was also the reason why the “Grids Package” had been up in the air for so long.
Revenue from network congestion
On the major chapter of financing, the Commission’s initial proposal spoke of using part of the revenues arising from congestion on interconnections, that is when the cables “fill up”, (today these amounts are in the hands of the Transmission System Operators) to cover part of the investments in new networks.
The Commission’s initial proposal, for 25% to be committed directly at central level to finance interconnections of European interest, triggered a barrage of reactions from Sweden. Because of the design of its market, the country accounts for more than 50% of total revenues from network congestion across the entire EU.
Indeed, at the Energy Council of last March, Swedish Energy Minister Ebba Busch had signaled that if the EU proposal passes, not only would the country limit electricity exports to its neighbors, but it would also “freeze” - as it did - new interconnections to Denmark and Finland.
“With all due respect to my distinguished colleague from Sweden, ultimatums are not the way we should be operating at this moment”, Greek minister St. Papastavrou had then replied to his counterpart, an indication also of the distance that existed until an agreement was reached.
The gap was bridged to the extent possible, as Friday’s text shows. Instead of 25%, the agreement provides that the Commission will commit 10% of congestion revenues for new European network projects starting in 2028, with a gradual increase of the percentage up to 25% in 2031. As for the commitment of the revenues, it will be done in an accounting manner, while “old” revenues that had been collected before the Regulation entered into force are excluded, as well as congestion revenues arising from internal bidding zones.
Although the provision appears to address Sweden’s main objections, as Ms. Busch stated, she clarified that the country will not launch work on the new interconnections with Denmark and Finland until the Grids Package enters into force.
How important the regulation is and how it affects us as a country can be seen, for example, from the bottleneck currently recorded between Bulgaria - Romania, hence the high wholesale prices in the two countries that also affect Hungary, as shown by the relevant map with the average prices for June.
If the new framework were already in force, Hungary could, according to those in the know, propose its financial contribution for the upgrade of the interconnections with Romania, so that the situation with Bulgaria could be decongested, with whatever that would mean for the SE Europe region.
Central planning
The new trans-European networks will be planned centrally and not under the “gaze” and priorities of each capital separately - something the Greek government has been pursuing since 2023 - however this does not mean that member states lose control completely. The data of each new plan will be “checked” by the states involved and the so-called “central scenario” for network planning will be adopted through an implementing act, following a relevant vote. At the same time, national and regional particularities will be taken into account. In short, the final decision will not be left exclusively to the Commission. The compromise is obvious.
There had been strong reactions in May from 5 countries - Bulgaria, Sweden, Finland, France and Poland, which in a joint letter argued that the Commission is “encroaching on the turf” of national competences and misinterpreting the way energy systems operate. The 5 insisted that the EU must take into account the coordination of regional systems and not gather all today’s individual competences into one central body.
Silent consent (but optional)
There was also a major clash regarding the Commission’s proposal that when a country’s national authority delays responding on a new interconnection, then the licensing would proceed with the so-called “silent consent”.
Although an attempt was made to establish it on a mandatory basis, reactions from countries that have not incorporated this specific principle into their national law, such as France, Germany, Austria and the Netherlands, contributed to the measure passing as optional.
In short, countries can apply silent approval to environmental and final decisions, but not mandatorily, only if they wish.
Satisfaction from the government
"The big picture is that this is a positive step toward better coordination of the European internal energy market. I believe that a good balance has been achieved between cooperation and the autonomy of states", was the reaction of the Minister of Environment and Energy, Stavros Papastavrou.
“In recent years we have seen the European electricity market become more fragmented, with prices moving unevenly among EU member states. The Grids Package is an important move to address this problem and lays the foundations for a more efficient system, with lower prices in the future,” notes in a related post, for his part, Deputy Minister of Environment and Energy Nikos Tsafos.
The latter, since 2023, as an adviser at the time to the Prime Minister, “ran” a series of initiatives to address distortions in the way European networks operate, for greater interconnectivity on the North-South axis, further integration of the Western Balkans and faster licensing of networks, as well as for finding additional resources for infrastructure, such as through the proposal for revenues from network congestion.