Solving the grid connection challenge

Grid connection backlogs are holding up the energy transition and creating a headache for utilities, grid operators, and developers with projects caught up in the logjam.

While regulators across Europe work to solve the grid connection challenge, some early-stage solutions are already helping to relieve its impact. These can ease the transition to renewables while presenting opportunities for energy sector participants, including virtual power plants (VPPs). 

The grid connection challenge

With some of the world’s most ambitious decarbonization goals, the energy transition is accelerating across Europe and Great Britain. 

But this emerging system relies on a grid built for a different era - and it’s creaking under the pressure. As we shift to a new distributed energy model that supports decarbonization, electrification, and the digital transition, grid strengthening is playing catch-up. 

Grids are heading towards or have hit capacity, and connection backlogs are hampering large-scale renewables projects and the demand-side developments that could relieve congestion. 

In the meantime, the established processes for new connections are no longer fit for purpose. There are two main options:

• Grid connection queue reform
• Optimize existing grid connections with demand flexibility, VPP and co-location projects

But first, let’s explore the magnitude of the problem in Europe and Great Britain.

The scale of the grid connection backlog

At the beginning of 2025, with waits reaching up to 15 years, Great Britain’s National Energy System Operator (NESO) temporarily paused new applications. The queue for battery storage connections alone was double the expected demand in 2030, according to Cornwall Insight.

It’s a similar story across the EU. Wind energy projects with a total potential capacity of 500 GW have been waiting in connection queues across the continent, with Ember citing 50 GW of projects awaiting grid connection in Poland and Romania alone.

What’s causing the connection backlog?

Many developments will never come to fruition. A surge in connection requests for battery developments in Germany has been partly fuelled by developers submitting multiple requests for the same project.

When connections take longer to process, developers submit more requests as a backup, adding to the problem. 

These multiple submissions are a major factor driving the backlogs:

Zombie projects

Speculative projects or multiple applications for the same development take up room in the queue, blocking those ready to go. In Slovakia, for instance, 50% of the reserved capacity never gets used. Similarly, British regulator Ofgem estimates that 40% of the projects in their queue are purely speculative and will never actually be built. 

Can’t keep up with renewables

Most countries have a ‘first-come, first-served’ approach. Shovel-ready developments are often held up behind those still in the scoping phase.

According to EU guidance, permits should be issued within two years, but this time frame is often missed. Croatia’s renewables industry complained that the country’s connection rules delayed developments and created uncertainty, threatening €1.5bn of new projects.

Aging grid infrastructure

Existing grid infrastructure can no longer keep pace with the emerging distributed, bi-directional model. The pressure on a grid nearing capacity is visible across Europe.

Slovakia’s TSO SEPS issued a ‘stop status’ when it was unable to add further new renewables installations to the grid. The Polish grid operator PSE has a similar issue. Its rapidly expanding PV resources have outgrown the grid, leading to frequent curtailment orders.

Shortage of qualified experts

The energy industry as a whole is struggling with a lack of skilled talent in many areas, as we’ve reported on before. This also impacts the review of grid connection requests, which, among other things, requires an evaluation of the impact the proposed connection would have on the power grid. According to Paul Manning of grid consultancy Novogrid, the network modelling experts qualified to perform complex power flow analysis are in short supply, and thus get drawn into better-paying consultancy roles. As a result, network operators are forced to take a much more cautious approach with approvals. 

The backlog is jeopardizing the energy transition

The EU is striving to be climate neutral by 2050, but the connection challenge risks derailing progress by:

Preventing new renewables development

Projects stuck in connection queues can’t help the EU achieve its renewable energy targets.

Poland has ambitious goals for solar and offshore wind. However, the country’s transmission system operator is increasingly refusing connection requests, with as much as 30 GW of new capacity prevented between 2015 and 2021.

Impacting long-term investment

Investors dislike the uncertainty that long connection queues bring. The Netherlands has 3.54 GW of renewable capacity waiting in the connection process, at an estimated cost of €376m annually. Meanwhile, the UK’s backlog includes over £200bn worth of renewable energy projects (though to be fair, the “zombie factor” described above means that not all of them will be realized).

Hindering flexibility

In an energy system increasingly reliant on renewables, battery storage and demand flexibility are vital in grid balancing. However, projects that could deliver flexibility, including battery energy storage systems (BESS) and electric vehicle (EV) charging infrastructure, are left in connection backlogs.

Without their support, renewable energy is wasted through curtailment. Experts estimate that without improved transmission capacity, curtailment costs in the UK will spiral to an annual £1bn (€1.17bn). 

Delaying electrification

From heat pumps to EV charging infrastructure to data centers, projects caught up in connection backlogs can’t support the switch away from fossil fuels.

Creating bottlenecks for commercial users’ net-zero goals

As large energy consumers, commercial and industrial (C&I) users are key to decarbonization efforts, but connection issues are frustrating their efforts. Many companies are looking to on-site renewables to power their organizations. Without a grid connection, any potential contribution to system flexibility is lost. 

Solving the connection backlog challenge

In the long term, grid strengthening can provide the capacity for increased renewable generation and the flexibility this system relies on. 

In the meantime, there are two routes to clearing the backlog - reforming the process and optimizing existing connections. Both will help accelerate the energy transition, but the second route also offers opportunities for VPP operators, grid operators, and developers.

Grid connection queue reform

Regulators and operators in the UK and across Europe have noted the damaging impact of connection backlogs. Many are shifting from ‘first-come, first-served’ to a system prioritizing ‘first-ready and most-needed’. Countries including Spain and France are accelerating their permitting processes.

In Great Britain, projects will also be assessed according to their alignment with national goals. Once they’re allocated a place in the queue, they will be expected to meet project milestones and may face financial penalties if those are missed.

These changes will accelerate the process, with the increased certainty expected to encourage investment.

Optimize existing grid connections 

The EU estimates that flexibility needs to double by 2030 to keep pace with an increasingly renewables-driven energy system. However, connection backlogs are delaying the supply—and demand-side developments that could deliver this flexibility. 

An alternative route is to optimize existing grid connections. This opens up opportunities for co-location, demand management, and VPPs, helping to ease the energy transition with additional flexibility. Here’s how:

1. Easing the transition with co-location

Renewable generation + BESS

Sharing a grid connection frees up space in the queue, and excess renewable energy can be stored with readily available battery storage.

It can then be sold back to the grid when demand increases and prices rise, balancing supply and demand and offsetting curtailment periods.

Traditional thermal power plant + BESS 

Energy systems still rely on nuclear or fossil fuel-based generation to ensure a constant supply when renewables generate insufficient power to meet demand, but the power from these plants is no longer needed 24/7. However, ramping traditional power plants up and down takes time, is inefficient, and can lead to increased carbon emissions. 

By co-locating with BESS, traditional thermal power plants can produce constant power at a low level, with BESS kicking in to store excess production and then discharging to help operators balance the grid when renewables can’t meet demand.

This type of co-location is already in use at the largest gas-fired power plant in Hungary, Dunamenti Power Plant.

Renewable generation + fossil fuel plant + data center

“Clean Repowering”, as RMI describes it, can help ease the transition to renewable power. The existing connection supplies the grid with renewable power, using the fossil fuel plant as backup. Excess renewable energy helps power the data center.

2. Repurposing underused connections

As coal-fired power plants are decommissioned, the grid connection can be recycled for new developments, such as data centers, solar farms, or BESS, taking them out of the connection queue. These sites may already have suitable power transmission infrastructure in place.

3. Demand side flexibility

Demand side flexibility is a key load-shifting strategy for system operators, helping to ease grid congestion and optimize existing grid infrastructure and connections.

Flexibility is now at the core of EU energy policy, with recent legislation mandating that energy retailers offer dynamic tariffs to consumers. This incentivizes end-users to shift consumption when demand is high and/or renewable generation is low, helping operators balance the grid.

Grid operators can also use aggregated consumer flexibility to participate in energy markets.

Flexibility from large C&I customers or distributed energy resources (DERs) has an even greater impact. To be even more effective, aggregator services can group C&I customers with smaller behind-the-meter developments, such as EV charging solutions or residential loads, into a VPP.

4. Virtual power plants

VPPs leverage multiple assets to deliver flexibility. Aggregated, these assets offer greater impact and can be traded as a single resource in energy markets.

In Europe, Germany has led the way, introducing regulations encouraging VPP participation in balancing markets, which has led to an expanding market and larger VPPs. 

In this environment, VPPs need cloud-based digital infrastructure that can scale to accommodate growing numbers of assets and boost their ability to participate in different markets.

That’s why leading VPPs are looking to a modular approach to IT architecture, which brings the agility required to succeed in a rapidly changing market. Operators can smoothly integrate best-in-class solutions, including access to specific geographic markets or the optimization that’s fundamental to offering viable flexibility services. 

The latest VPP platforms, like our own Energy Market of Things, are based on this modular approach. This helps operators manage expanding and more complex VPP through automation and improved visibility of both individual assets and across the entire VPP.

It also enables operators to trade in different energy markets, with features such as day-ahead scheduling, intraday trading, portfolio risk management, and automated settlement.

The connection backlog has delayed projects, created bottlenecks, and risks derailing the energy transition. But while the queues are frustrating, regulators in the UK and across Europe are tackling processes that can no longer cope with the scale of the challenge.

However, there are also new opportunities to be grasped. Energy sector participants can explore innovative solutions such as co-location and harness the latest technologies to offer much-needed flexibility.