Clean power infrastructure: Energy security moves to the foreground

European clean-power infrastructure is becoming more attractive as energy security strengthens demand, but returns will increasingly depend on market, technology and contract selection rather than broad renewable exposure.

• The European Commission’s Electrification Action Plan aims to raise the EU electrification rate from approximately 23% today to 46% by 2040, requiring investment in renewable generation, storage, synchronous condensers, electric vehicles and heat pumps.
• Disruption to LNG flows through the Strait of Hormuz, combined with relatively low European gas storage, lifted gas and longer-dated forward power prices; L&G found that March-July 2026 capture-price increases averaged €13/MWh for solar and €16/MWh for onshore and offshore wind versus the same period in 2025.
• Solar capture prices were more exposed to cannibalisation in high-penetration markets such as Spain and France, while batteries could benefit from charging during solar-driven low-price periods and discharging when gas-fired generation pushed prices higher.
• With revenue per MW indexed to 100 in January 2025, L&G’s European weighted measure reached 102.7 for solar, 111.7 for onshore wind, 130.4 for offshore wind and 126.5 for a two-hour BESS by August 2026; solar capture rates nevertheless fell 8.6%, while offshore-wind capture prices rose 22%.
• Germany’s May onshore-wind auction received 6.4GW of bids for 2.5GW of capacity, with winning bids averaging €50.6/MWh, 9% below the previous auction and 30% below the ceiling price, indicating continued demand for stable contracted cash flows despite higher merchant prices.

Takeaway: Investors should favour disciplined entry pricing, diversification and specialist underwriting; contracted revenues can protect downside, while merchant, co-located and hybrid assets offer upside but remain exposed to dispatch assumptions, market design and power-price volatility.