The European Commission is drafting a plan to invest some €584 billion ($637bn) to upgrade the region's power grids.

The investment would primarily help countries handle varied renewable energy loads, modernize transmission, and improve cyber security.

European Commission
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“Europe’s power networks are confronted with new and significant challenges,” the draft document, seen by Bloomberg and Reuters, states.

“They will need to serve growing demand linked to clean mobility, heating and cooling, electrification of industry, and the kick start of green hydrogen production.”

It notes that 40 percent of Europe’s distribution grids are more than four decades old, while power consumption is expected to increase 60 percent by the end of the decade.

The Commission will grant "projects of common interest" status to 68 electricity projects, which gives them access to faster permits and more EU funds. 12 of those projects are for energy storage.

"Grids need to adapt to a more decentralized, digitalized, and flexible electricity system with millions of rooftop solar panels and local energy communities sharing resources," the document says.

The Commission plans to work with investors, regulators, and credit agencies to make it easier for grid projects to secure loans, equity, and guarantees, and explore new financing instruments with the European Investment Bank.

The EC plans to unveil the new proposals this week. While the EU can pass some financing rules and invest some money, much of the $637bn would have to come from individual EU member states, so the investment is not guaranteed.