No transition without transmission: How power grid operators are innovating

TSOs transport high- or extra-high-voltage electricity (suitable for long distances) from power plants to primary substations and are responsible for ensuring grid stability, that is, constantly balancing supply and demand. This is a complex task: demand fluctuates throughout the day, across the week, and between seasons. Yet maintaining that balance is essential to prevent blackouts. TSOs typically operate as national monopolies. In Italy, the TSO is Terna; Germany, with four TSOs, is a notable exception.

At the primary substations, electricity is transformed from high to medium voltage and then distributed to secondary substations, where it is further reduced to low voltage for homes, businesses, and other end-users. This part of the network is managed by Distribution System Operators (DSOs), responsible for maintaining local lines, developing the distribution network, and managing electricity meters.

Finally, electricity is sold to end-users by energy suppliers operating in a competitive, liberalized market. These companies are often well-known due to their advertising and marketing efforts.

The rapid growth of renewable energy is transforming the grid from a linear system built around centralized generation at a few large plants into a more complex and decentralized network. This new grid must handle distributed, intermittent energy sources, with thousands of wind turbines, solar panels, and batteries.

Between 2004 and 2023, the share of renewables in Europe’s electricity mix tripled from around 15% to 45%. Wind and solar grew from 2% to nearly 29% in the same period.

In 2024, renewables accounted for 47% of electricity generation (57% in Germany and 49% in Italy), with fossil fuels at 29% and nuclear at 24%.

And yet, while national strategies and investments are growing, there was still no clear picture of how European TSOs are managing this transformation. What are their priorities? How do they organize for innovation? What role do new technologies play? What’s really holding change back? And how do they see their role evolving?

As part of his PhD thesis at the Centre for Environmental Policy, Imperial College London, Andrea Biancardi conducted semi-structured interviews with innovation leaders at several major European TSOs. The TSOs were selected to reflect a diversity of sizes, geographies, innovation maturity, organizational models, and national energy mixes. The qualitative approach, based on in-depth, anonymous interviews, made it possible to collect candid insights beyond official communication.

The sample included both small innovation teams (1–6 people) and large, structured departments (up to 100 employees). The interviews explored strategic topics (how priorities are defined), operational issues (what technologies are being adopted), organizational models (centralized vs. decentralized innovation), and regulatory aspects.

The findings were later developed into a research article co-authored with Iain Staffell and published in Energy Strategy Reviews.

The study shows that TSOs recognize the need to innovate and are actively exploring new technologies. However, they face major barriers that call for internal strategic changes and strong regulatory support.

From an organizational perspective, replicable best practices are emerging: hybrid innovation models involving operational teams in priority setting; dedicated research and testing centers and open innovation programs; investments in startups through corporate venture capital; and systematic collaboration with universities, regulators, and private companies.

Two top priorities stand out across the interviews: ensuring grid stability and digitalizing the system. Frequently cited areas of digital innovation include artificial intelligence, digital twins, cybersecurity, and robotics. On the operational front, strong interest emerged in NWAs, particularly in Dynamic Line Rating (DLR) and energy storage technologies, with batteries taking center stage.

DLR technologies involve sensors and feedback systems placed along power lines that calculate, in real time, the maximum current that can safely be transmitted, based on weather conditions and conductor temperature. This allows TSOs to boost transmission capacity when conditions permit, maximizing the existing grid’s potential and postponing costly infrastructure investments. While interest in energy storage is high, current European regulations significantly limit TSOs’ direct involvement in managing it.

Indeed, regulation is one of the two most frequently mentioned barriers to innovation. Many interviewees noted that the current regulatory framework creates distorted incentives that favor capital-intensive (CAPEX) investments while discouraging the adoption of more flexible and cost-effective technologies like non-wires alternatives. These inefficiencies could undermine public support for the energy transition.

Some interviewees suggested that better coordination with other infrastructure operators (those managing networks for natural gas, biomethane, hydrogen, water, telecommunications, or transport) could help reduce costs by avoiding redundant interventions. Integration with electricity distributors (DSOs) was also seen as a potential path forward.

In the UK, cross-sector coordination is already becoming a reality, thanks to the establishment of an independent authority for strategic infrastructure planning. But integrating TSOs and DSOs, or possibly even different TSOs, is a politically sensitive issue, as it could affect market competition.

The second major obstacle is the talent gap. Many TSOs report difficulty attracting and retaining the skilled professionals needed to deliver the necessary transformations. Qualified technical staff are in short supply, and much of the emerging workforce lacks adequate experience. This complicates efforts to build and sustain a workforce aligned with rapidly evolving technologies, posing serious challenges given the tight timelines imposed by the energy transition and the urgency of the climate crisis.

Andrea Biancardi, Iain Staffell, “How do electricity TSOs embrace innovation to future-proof their role in the energy transition?” In Energy Strategy Reviews 59 (2025) 101746.  DOI: https://doi.org/10.1016/j.esr.2025.101746.