Electrification is accelerating – but is the infrastructure ready?

As demand for clean electricity grows, Matteo Crespi, Senior Vice President, Power Products Europe Hub at Schneider Electric, explains why Europe must invest in smarter, more resilient electrical systems.

Europe is entering a new era of electricity. Electric vehicles, heat pumps, renewable generation, data centres and AI infrastructure are all increasing demand for clean, reliable power. The EU’s Electrification Action Plan recognises the scale of this opportunity, setting an ambition for electricity to account for 46% of final energy consumption by 2040.

This is not simply a climate target. Electrification is an industrial, economic and energy-security imperative. Applications are shifting away from imported fossil fuels and towards efficient, clean electricity that can reduce exposure to volatile global energy markets, strengthen European competitiveness and keep more value within the region.

But targets alone will not deliver this future. Europe must also invest in the infrastructure and electrical ecosystems that make electrification possible.

The evolving electricity ecosystem

Much of today’s energy infrastructure was designed for a different world, one in which large, centralised power stations supplied electricity in a predictable, one-way flow to passive consumers. That model is rapidly being overtaken by a more decentralised, dynamic and digital energy system.

Electricity is now generated, stored and consumed in more places. A building may draw power from the grid, generate it through rooftop solar, store it in batteries, charge electric vehicles and adjust consumption in response to changing prices or grid conditions. Factories increasingly need high-quality, uninterrupted power to support automated operations. Data centres require growing volumes of electricity, delivered with resilience and speed. Across Europe, consumers are becoming active participants in the energy system.

To make electrification work at scale, the infrastructure connecting all these assets must be ready, particularly the ‘last mile’ of electricity distribution.

The infrastructure challenge behind electrification

Europe’s energy transition is often framed around the need to build more renewable generation. That remains essential. But clean power only delivers its full value if it can be connected, converted, managed and used intelligently.

Outdated networks can become a bottleneck. They were not built to manage two-way flows of energy, variable renewable generation or millions of connected devices that both consume and produce electricity. Without modernisation, connection delays, grid congestion and reliability concerns could slow the deployment of the very technologies Europe needs to meet its energy-security, industrial and decarbonisation goals.

The answer is not simply to build more of the same. Europe needs a smarter electrical backbone, one that is more flexible, digital and resilient by design.

This means modernising networks at every level, from substations and distribution systems to the electrical infrastructure inside buildings, factories and critical facilities. It also means recognising that the transition is as much about managing demand intelligently as it is about supplying more power.

The cheapest, cleanest and fastest unit of energy is the one that is not wasted. Efficiency, electrification and flexibility must work together. When organisations can monitor power use in real time, shift non-essential loads, integrate on-site generation and storage, and optimise operations around grid conditions, they can reduce costs while helping relieve pressure on the wider energy system.

The role of smart switchgear and power electronics

Technologies such as smart switchgear, power electronic inverters, converters, variable-speed drives and uninterruptible power supplies play an important role in how electricity is converted, controlled and delivered.

Their role is becoming increasingly important as electrical systems accommodate more varied sources of generation and demand.

Inverters and converters, for example, enable renewable energy, battery storage, electric-vehicle charging and many modern digital applications to interact effectively with the grid. Smart switchgear can provide greater visibility, protection and control to electrical systems, helping operators identify faults faster, improve reliability and use assets more efficiently.

At the same time, digital tools can turn electrical infrastructure into an active source of intelligence. Connected devices, real-time monitoring and automation give grid operators and energy users a clearer understanding of how energy is flowing and where intervention is needed. This can support faster decisions, more effective maintenance and more responsive demand management.

From passive networks to active energy systems

The opportunity is to move beyond a grid that functions as a passive network. Europe needs an energy system that can respond dynamically to changing supply and demand, integrating renewables, storage, flexible loads and decentralised resources without compromising reliability.

For businesses, this shift is already becoming an operational priority. Companies can no longer treat energy simply as an overhead or a compliance issue. By investing in smarter electrical infrastructure, on-site generation, storage, digital energy management and flexible demand, they can gain greater visibility and control over how energy is used.

This is about more than lowering emissions. Modern electrical systems can reduce exposure to energy-price volatility, improve efficiency, protect critical operations from disruption and create capacity for growth. They can also enable businesses to play a more active role in the energy system, shifting demand away from peaks, making better use of locally generated power and supporting grid stability.

Europe's future is electric

Europe has the technology, industrial capability and policy momentum to lead in this next phase of the energy transition. But the real test will be implementation.

Electrification can help Europe reduce dependence on imported fossil fuels and build a more secure, efficient and competitive energy future. To realise that promise, we must invest not only in the clean power we generate, but in the intelligent electrical infrastructure that enables it to flow.