Electricity transmission infrastructure has moved from a background utility function to one of the defining strategic priorities of the energy transition. Across Europe, renewable generation capacity has expanded rapidly, but transmission investment has not kept pace with the level of network expansion required to support the next phase of the energy transition. This has created a structural mismatch, making grid infrastructure a critical factor in achieving decarbonisation and energy-security objectives.

The scale of investment required is substantial, with the European Commission estimating €584.0 Bn of grid investment required by 2030 and cross-border transmission capacity needing to double by then. Europe’s traditional transmission model has been dominated by regulated TSOs, the entities responsible for owning, operating and maintaining high-voltage electricity transmission networks, supported by regulated asset base frameworks and centralised planning. This model has historically provided stable returns, reliable system coordination and low-risk infrastructure ownership. However, its ability to deliver at the required pace is increasingly constrained by permitting delays, supply-chain bottlenecks and the growing complexity of decentralised generation. In many markets, transmission build-out remains slower than renewables deployment, creating connection queues, curtailment risks and delays to strategic energy projects, prompting policymakers to consider more competitive and private- capital-led models to help accelerate delivery.

The clearest example of this shift is the UK’s CATO model, which introduces project-based competition into onshore transmission by allowing private developers to compete for the delivery of specific transmission assets under a regulated framework. This represents a significant departure from monopoly ownership and creates a potential route for institutional capital to participate directly in defined transmission projects.

Competitive frameworks can broaden the investor base, ease the capital burden on incumbent TSOs and improve delivery discipline for clearly defined project categories. However, they are not a complete solution to Europe’s grid challenge. Their effectiveness depends on clear project scope, appropriate risk allocation and bankable revenue frameworks, while broader delays linked to permitting, planning approvals, public opposition and cross-border cost allocation are likely to remain.

The scalability of CATO-like models across Europe is therefore likely to be selective across geographies. Countries with mature regulatory systems, experience in public- private partnerships (“PPP”) or concession frameworks, and clear investment pipelines are better placed to adopt competitive models. In contrast, markets with stronger state ownership traditions, fragmented regulatory structures or political resistance to private grid ownership may remain largely TSO-led. The likely outcome is not wholesale privatisation of transmission, but a hybrid model in which core grid planning and system operation remain centrally managed, while competition is introduced for clearly defined assets.