In March 2026 DSO Entity published its comprehensive reaction to the European Grids Package. The package is welcomed as part of a broader European Grids Momentum, which recognises electricity grids as the backbone of a resilient, competitive, and sustainable European Union. With a focus on three core areas – planning, permitting, and connection – the Grids Package builds on the Grid Action Plan (2023) and DSO Entity’s establishment as institutional partner (2021).
In a nutshell: The package covers relevant aspects but gaps remain
DSO Entity welcomes the proposed acceleration of permitting procedures and the holistic, flexible approach to grid connections, including support for anticipatory investments. However, concerns remain regarding tacit approval for grid connection decisions, which may pose safety and technical risks, as well as a shift towards more top-down planning that is not fully in line with an increasingly decentralised system. Overall, the Grids Package falls short of fully recognising the scale of DSO investment needs and of providing a sufficiently enabling framework, particularly in light of growing resilience requirements and external constraints such as supply chains and workforce availability.
Key aspects to be considered from a DSO perspective
What are the key aspects for DSOs and how is the Grids Package assessed from this perspective?
1- Ensure adequate recognition and funding for DSO investments
DSOs are facing rapidly increasing investment and financing requirements to deliver a sustainable and resilient transition. While it is acknowledged that more than €730 billion of the €1.2 trillion in required grid investments by 2040 will need to be allocated to DSOs (COM 2025, 1006, p. 1), the TEN-E framework remains predominantly focused on cross-border TSO projects. DSOs are largely limited in eligibility for smart grid projects and are excluded from Projects of Mutual Interest (PMIs), with additional uncertainty regarding the applicability of the newly added resilience category.
2- Strengthen bottom-up and coordinated grid planning
In an increasingly decentralised energy system, national network planning becomes more bottom-up (DSO forecasts), inclusive (grid users) and cooperative (TSO-DSO). The inclusion of DSO forecasts and assumptions in TSO development plans (both TNDPs and the TYNDP) is essential to avoid bottlenecks at distribution level where new loads and generation are connected. It is welcome that the package highlights the need for close coordination between distribution and transmission planning, i.e. the integration of DSO inputs into TSO planning. The absence of further harmonisation of Distribution Network Development Plans (DNDPs) is positive, while more top-down planning approaches related to scenario building should be treated with caution.
3- Accelerate permitting while safeguarding technical standards of grid operation
Procedures can take up to 8-10 years in the medium- and high-voltage distribution network and are a major bottleneck for DSOs. The proposal to accelerate permitting procedures for grid infrastructure, including shorter time limits, the designation of electricity grids as projects of overriding public interest, and the streamlined environmental assessments, are positive. However, grid connection procedures differ from permitting processes facilitated by public authorities and should not be referred to as permits. Also, efforts to accelerate procedures must not compromise safety or technical requirements; i.e. tacit approval mechanisms based on the absence of a DSO response are not supported.
4- Establish clear and efficient frameworks for grid connections at national level
The holistic approach to grid connections is generally welcomed, notably its recognition of anticipatory investments, long-term planning, and external challenges. While proposals to move beyond the ‘first-come, first-served’ principle are supported, clear national legal frameworks are needed to ensure legal certainty and practical implementation for grid operators. Some proposals on enhanced hosting capacity transparency risk going beyond existing EU legislation and may increase administrative burden with limited added value. DSO Entity supports capacity-based and static time-of-use tariffs which can improve cost reflectivity, highly dynamic tariffs risk excessive complexity and limited effectiveness.
5- Enable effective national implementation and address remaining gaps
Given the national nature of DSOs, the package alone will not resolve all their underlying challenges. The implementation of forward-looking regulatory frameworks and anticipatory investments aligned with existing EU rules remains essential, including adequate compensation and predictability about future earnings. The package also failed to sufficiently address other challenges, such as growing resilience requirements pertaining to extreme weather events and external constraints like supply chains or staffing.
Strengthening multi-level governance and institutional cooperation
Finally, in a more interconnected and decentralised electricity system, strong multi-level governance and close cooperation among key EU institutions (EC, ACER, DSO Entity, ENTSO-E) are indispensable to ensure coherence, resilience, and efficiency. DSO Entity is ready to further enhance the coordination and exchange between different players and among multiple levels to ensure the successful management of this system-of-systems.
Read the full reaction here
For more information please contact: Elisa.Vandooren@eudsoentity.eu