In the keynote speech at the CIGRE Symposium (Lisbon, April 2013) Mr. Dominique Ristori, Director-General of the Joint Research Center of the European Commission, presented on behalf of the EC three points comprising the backbone of the modern electrical power system, namely: - the vital role smart grids have to play in enhancing growth, competitiveness, and creating new jobs worldwide, - addressing key challenges facing full development of smart grids, - the responsibility of institutional bodies to meet those challenges. Energy and science are factors important to a more competitive economy because without investment in science, there would be no innovation in the energy sector (including the subsector of electricity, in particular energy technologies and their management. The EU energy sector is highly dependent, particularly with respect to oil and gas, and affected by high energy prices. Reducing energy waste is not only important for households and small andmediumsize businesses, but for entire economies in order for them to retain their competiveness. It is clear that the European energy landscape is changing rapidly and will continue to do so in the coming years. That is why the European energy and environment targets (3 × 20 for 2020) call for a rethinking of the way we produce, transmit, and consume energy. Smart grids are a defining feature of the overall policy framework, which drives forward their deployment in the EU. The challenges come primarily in the areas of investment, technology, and the regulatory environment. This will require the full cooperation of business, operators, science, and governments.