In recent years, the energy transition has been told as a race for installed gigawatts. More solar panels, more wind turbines, more hydroelectric, geothermal or biomass plants. A quantitative narrative that played a decisive role: between 2010 and 2025, the cost of photovoltaics plummeted 85 percent, wind power halved in price, and, for the first time in history, renewables surpassed coal in 2025 to become the leading global source of electricity. Today, however, the energy transition is entering new territory, where the central question is no longer “how much clean energy do we produce?” but“how do we use it, when do we use it, how much do we get out of it?” It is a profound and radical paradigm shift, marking a shift from a quantitative transition to a qualitative and systemic transition, in which energy management becomes more important than energy production.
The paradox of abundance
In Europe, during the middle hours of the sunniest days, photovoltaic generation increasingly exceeds demand or the capacity of the grid to transport it. This is the phenomenon ofover generation: clean energy available, but not usable. According to Bloomberg, by 2026, Europe risks wasting 40 TWh of renewable energy, the equivalent of Greater London’s annual consumption. The oversupply also generates a side effect: negative prices. In Germany and France, during spring 2026, electricity went as low as -500 €/MWh during peak irradiation hours. The hours with negative prices more than doubled in five years, from about 200 in 2020 to more than 500 in 2025. In France, in April 2026 and despite nuclear power, 45 percent of solar generation occurred during negative price hours; in Germany, episodes of negative prices exceeding six consecutive hours quadrupled in one year. This is the so-called“photovoltaic cannibalization” effect: the more panels produce at once, the more the value of energy plummets. This paradox, however, is not a failure of renewables. It is a sign that the European electricity system is changing its skin and that infrastructure, rules and markets are not yet aligned with the new reality.
Networks designed for the twentieth century: the real bottleneck
The problem, therefore, is not “too much sun,” but that European grids were designed for a world that no longer exists: a world of large programmable power plants, unidirectional flows, relatively stable demand, and production concentrated in a few places. Today, production is distributed, intermittent, digital. And the grid is not ready. In Italy, for example, there are 12 billion euros worth of renewable plants already approved that cannot be connected to the grid. Local grids are saturated, secondary substations obsolete, procedures slow. Meanwhile, production is growing at an impressive pace: as of April 2026, Italy’s photovoltaics exceeded 5 billion kWh, an increase of 23.7 percent over the previous year, driven by more than 2,100 MW of new capacity installed in the first months of the year. Yet as renewable production accelerates, the grid fails to follow: net domestic production fell and imports rose 32.4 percent. It is a glaring paradox: we are producing more clean energy, but using less of it. This happens because the grid is unable to absorb and distribute the energy when it is produced. Without massive infrastructure upgrades, every new megawatt risks turning into congestion.
Flexibility as a new system architecture
The energy transition is no longer a challenge of expanding capacity, but of managing variability. The key word is flexibility: the ability of the system to adapt in real time to renewable generation. Flexibility means shifting consumption during surplus hours, modulating industrial loads, integrating electric vehicles and heat pumps, activating distributed resources, and bringing supply and demand together in real time. The only real positive signal comes from industry. Terna’s IMCEI index shows that energy-intensive companies increased consumption by 8.8 percent and on holidays with high renewable generation increased demand by more than 60 percent, helping to stabilize the grid. This is proof that when flexibility is incentivized, it works. Today, however, flexibility is still not rewarded in a systemic way. And without a price, the system does not move.
Storage: transforming energy from instantaneous to programmable
Storage, therefore, is the most immediate component of flexibility. Batteries, hydropower pumping, hybrid systems and green hydrogen make it possible to absorb peaks and return energy when needed, reducing volatility. There are already more than 930,000 storage systems in Italy, with a total capacity of 19,015 MWh and a capacity of 7,840 MW. The new MACSE mechanism will bring 10 GWh of batteries by 2027, while European storage capacity could quadruple by 2030. Storage is no longer an accessory: it is system infrastructure, essential for transforming renewable generation from instantaneous to programmable.
From over generation to industrial competitiveness
Over generation is not just a technical problem: it is an untapped economic resource. If renewable energy becomes abundant in the middle hours of the day, and at near-zero marginal cost, then the real challenge is to build an industrial system capable of using it. It is no longer a matter of “managing an excess,” but of turning that excess into a competitive advantage. Low-cost energy can power electrolyzers for green hydrogen production, dramatically reducing the cost of an energy carrier that will be central to the decarbonization of hard-to-abate sectors. It can support the growth of data centers, strategic and increasingly energy-intensive digital infrastructure. It can make the electrification of industrial processes more cost-effective, encouraging the relocation of manufacturing activities that have moved to countries with cheaper energy in recent years. The same applies to the residential sector (which the author writes about in the new Condominium Energy Handbook Ed.), where heat pumps and air conditioning systems can be switched on at times of greatest renewable availability, reducing costs for households and relieving the grid during peak hours. In this scenario, over generation is no longer a limitation, but an industrial pull factor. Regions that can integrate renewable generation, storage, flexible demand and new energy uses will become competitive hubs that can attract investment, innovation and skilled employment.
Institutional governance: the building block that makes everything else possible
None of the technical solutions available today can work without institutional governance that matches the complexity of the system. Energy transition is not a spontaneous process: it is a governed process, requiring coordination, clear rules, defined responsibilities and integrated planning tools. The new European framework, with Market Design and the Internal Energy Market Directive, goes exactly in this direction. For the first time, Europe recognizes that energy management cannot be separated from land, industry and grid management. The reform introduces transparency obligations on connection queues, incentives to digitize grids, local flexibility markets, priority criteria for projects that generate collective benefits, and a strengthening of the role of DSOs, who are called upon to become active players in the transition and not mere infrastructure managers. Governance must also ensure that flexibility is adequately remunerated. Without a market that recognizes the value of shifting consumption, industrial modulation, storage, and the participation of energy communities, demand will remain rigid and the system will continue to suffer peaks instead of enhancing them.
Conclusion: governing abundance to build a new energy model
In conclusion, over generation is not a problem to be avoided, but an opportunity to be governed. To seize this opportunity we need stronger, digital networks, widespread storage, flexible demand, new industrial uses, active energy communities and governance capable of coordinating energy, industry and land. It is a change that requires investment, but above all a clear political vision: to move from a system that suffers peaks to a system that anticipates them, absorbs them, and makes the most of them. The future of energy will depend not only on how many gigawatts we install, but on how well we can transform clean energy into economic value, energy security and industrial competitiveness.
