Europe’s net-zero future: moving into implementation

A focus from target setting to policy implementation will be central to the tenth European mandate

By Annika Brack

Annika Brack is the Director for Energy, Sustainability and Mobility at CERRE.

04 Apr 2024

The 2019-24 Commission, led by Ursula von der Leyen, will be remembered for its ambitious Green Deal legislation. It coincided with a pandemic, a war and heightened geopolitical tension, and economic turbulence that has underscored the critical importance of Europe’s commitment to decarbonisation.

Resilience amidst adversity

In difficult times, Europe has witnessed that markets can withstand and adapt, adhering to the principles of supply and demand. Energy prices soared from record lows to record highs and have since bounced back to almost pre-war levels. Nonetheless, this period has imbued Europe with a lingering sense of discomfort exposing the region’s over-reliance on single energy sources and highlighting vulnerabilities in global supply chains.

The energy crisis served as a wake-up call for Europe’s industry, revealing the unsustainability of its reliance on inexpensive pipeline gas from the East – a longstanding strategic advantage the region has lost. Embracing decarbonisation and diversification of energy supplies requires adapting to higher and more volatile energy prices. As pointed out by the Centre on Regulation in Europe (CERRE) in December 2022, the way forward lies in championing demand reduction, leveraging domestic energy and network efficiencies with a better use of smart grid technology and smart contracts, as well as driving a massive expansion of sustainable, and eventually more affordable, energy supplies from within and outside Europe.

A sustainable and resilient European economy is a goal worth striving for

The next phase of the Green Deal is implementation

These past five years have stretched the capacities of civil society, corporate lobbyists, and the institutions themselves to their limits. Yet, the work is only just beginning. The upcoming Commission must deliver on the energy transition and move the region from target-setting to implementation. This entails balancing the acceleration of the Green Deal agenda with ensuring energy security and achieving more competitive energy prices. A deeper integration of the European single energy market remains critical to achieving both climate goals and security of supply in the most cost-efficient way. This will require a readiness to address trade-offs, paired with a much stronger monitoring and coordination amongst EU member states, regions, and sectors to help avoiding unilateral actions by individual member states that weaken market integration.

CERRE’s upcoming Ambitions paper for the next EU term again underscores the critical role of infrastructure development, and the necessity to enhance the digitalisation of energy networks. Significant public funds will have to bridge the “valley of death” to the commercial viability and system integration of low-carbon technologies, such as hydrogen. The de-risking of strategically important investments must be achieved whilst mobilising large amounts of private capital.

Marrying the Green Deal with Europe’s industrial future

Helping the region navigate this important transformation remains a monumental task, and one goal of the triangle between affordability, sustainability, and competitiveness should not be played out against another. This journey will require unparalleled cooperation. Yet the reward – a sustainable and resilient European economy – is a goal worth striving for.