EU’s Electrification action plan released to to boost decarbonisation and competitiveness
Electrification comes with substantial benefits for the EU economy, businesses and citizens, in terms of lower energy prices and competitiveness, stronger energy security and resilience. For example, switching from gas boilers to heat pumps cuts the average EU household’s heating bill by up to 60%, while providing important co-benefits for climate adaptation.
However, barriers to widespread adoption remain. Electricity often costs 3 times more than gas and grid connections can take years. Too many innovative technologies never reach commercial scale, and companies have too little incentive to make the switch from fossil fuels to electricity.
The Electrification Action Plan released in July 2026 focus on reducing the price gap between electricity and fossil energy costs and on incentivising the uptake of cleaner, electricity-based technologies such as heat pumps, electric vehicles and batteries.
This action plan aimed at speeding up the shift from fossil fuels to electricity and make Europe the world’s first “electro-powered” continent by aiming to increase electrification from today’s 23% of energy use to 46% by 2040. By reaching this goal, the EU could save €260 billion per year in fossil fuel imports.
Measures in the plan include lowering upfront costs of electrification technologies across key demand sectors. This will be achieved by mobilising tools such as social leasing schemes, the Emissions Trading System (ETS) financial instrument and the Social Climate Fund. The EU’s plan is also proposing actions to accelerate the uptake of innovative electrification solutions, while investing in skills and jobs in electrification.
Electrification of industry
While the EU’s industry sector has achieved energy efficiency improvements, it represents almost a quarter of the EU’s energy demand and the shift from fossil fuels to electricity remains slow. In this context, industrial electrification represents an opportunity for European industry to modernise, further increase its efficiency and productivity and reinforce its global competitiveness.
Industrial applications in sectors such as pulp and paper are well suited for electrification, and industrial heat pumps can provide process heat up to 400–500°C. A study on pathways and policies for accelerating electrification and use of renewables in industry published in July 2026, identified key barriers including high electricity costs, grid constraints, investment needs, competitiveness concerns, and policy uncertainty. The analysis highlights substantial technical potential for industrial electrification, exceeding 2 000 TWh by 2040.
EEETHOS is participating in this effort by demonstrating high-efficiency technologies that enable the electrification of high-temperature industrial heating up to 300°C, and closing the current technological gap in industrial decarbonisation.
