Santander Bank has conveyed to the European Commission the necessity of introducing changes to EU energy regulation to enable private capital entry into financing large-scale cross-country electrical interconnections.
The institution held a meeting in Brussels on October 13 with representatives from Teresa Ribera's office, Executive Vice President of the European Commission for a Clean, Just and Competitive Transition. During the event, investment banking executives from Santander and public policy officials presented their views before Miguel Gil Tertre, Chief of Staff to Ribera, and Aleksandra Barańska, member of her team.
Objective of the dialogue
The topic addressed was the Europe Electrification Action Plan. Among the key points raised by Ana Botín-led entity were: integration of European energy systems, mobilization of private investment to develop infrastructure, and removal of regulatory barriers that hinder financing of cross-border projects.
Challenges in financing
Santander Bank considers interconnections to be an essential tool for reducing electricity prices and improving the functioning of the European energy market. These infrastructures enable energy transport between countries, allow surplus generation from one market to meet demand elsewhere, and facilitate renewable energy integration.
However, its construction requires very high investments and prolonged development periods, which forces promoters to have visibility into the revenues they may earn over decades.
Regulatory claims
It is precisely in this last point where Santander identifies one of the main problems. The document records its request to eliminate regulatory barriers that create a gap between current European rules on non-discriminatory cross-border capacity allocation and investors' need for certainty about revenues over periods exceeding ten years.
The claim highlights the necessity of adapting electricity market rules so that interconnections can offer a more predictable revenue horizon. Without such security, infrastructure funds and other institutional investors may face difficulties in assuming the risks associated with projects of this scale.
Solution proposed
Santander proposes fostering alliances among specialized funds, energy companies, electric utilities, transportation system operators (TSOs), and regulators. The objective is to bring together all necessary participants to develop and finance new connections between countries.
The request submitted by Santander goes through "removing regulatory barriers to close the existing banking viability gap between current European Union rules on cross-border capacity allocation—based on non-discrimination principles—and investors' need for long-term income certainty beyond a ten-year horizon", as stated in official Commission documentation.
Institutional Context
Santander has highlighted its experience in financing renewable energy. Its customer portfolio covers the entire value chain of clean energy: from renewable generation, electrical grids and storage to energy efficiency, hydrogen or green fuels.
The bank's interest arises at a time when Brussels is trying to accelerate economic electrification and strengthen connections among national markets. The Electrification Action Plan presented by the Commission in July 2026 proposes increasing electricity's share in final energy consumption from the current 23% to 46% by 2040.
To achieve this goal it will be necessary to expand renewable power generation capacity, modernize networks, and facilitate greater fluidity of electricity flowing between member states.
The European Union also maintains the objective that electrical interconnections reach at least 15% of each country's installed generation capacity by 2030. Insufficient connections continue to represent a key obstacle to achieving an efficient and integrated energy transition.