Promoting Energy and Technological Sovereignty

Europe stands at a crossroads. The continent’s long-standing dependence on fossil energy has become both a strategic vulnerability and an economic handicap. As of 2024, two-thirds of Europe’s energy mix remains carbon-based. 90% of the gas and 97% of the oil consumed in the EU being imported. This addiction to imported fossil fuels cost the EU a staggering €427 billion in trade deficits last year alone. This is more than one billion euros per day.

As long as Europe remains tethered to the fluctuations of oil and gas prices, its industries will struggle to compete. This is a geological reality. Gas will always be cheaper in resource-rich Texas than in resource-poor Germany. 

We however possess a few decisive advantages. We are a scientific and innovation powerhouse. EU law provides regulatory certainty for a market of 450 million wealthy consumers. We have enough solar radiation, wind, nuclear and renewable wind to provide to our industry decarbonised energy it needs, in a way that is secure and affordable. 

More than environmental necessity; this is an economic imperative. Continued dependence on volatile fossil fuel prices is a recipe for industrial decline. By contrast, a transition to renewables and clean technologies offers a realistic path to economic sovereignty and prosperity.

Renewable energy is “freedom energy”. It frees us from geopolitical dependencies on the enemies of Europe: Russia and the Islamic Republic of Iran who can, in a single decision, shoot gas and oil prices through the roof. By contrast, we retain control over our own homegrown energy sources. Renewables are already making 45% of the electricity and 25% of the overall energy consumption in the EU. They have played a vital role in reducing dependence on Russian gas and shielding consumers from extreme price volatility.

To fully realise this potential, the EU must play to its strengths. Let’s scale our investments in renewable technologies—offshore and onshore wind, solar thermal and PV, geothermal, heat pumps, tidal and wave energy, and even emerging sources like airborne wind and osmotic power. Each Member State must adopt tailored investment plans based on their unique geography and industrial strengths.

Equally important is energy efficiency—the “invisible powerhouse” of our transition. By improving building insulation, modernising industrial processes, Europe can significantly reduce its energy needs and bills, while creating local jobs, lifting families from energy poverty and guarantee comfort against both cold winters and heatwaves.

To maximise the economic and geopolitical benefits of the cleantech revolution, we need to invest to manufacture most of this equipment in Europe. Each sector needs a specific kind of support. For heat pumps, supporting demand through regulation or public support is likely to suffice. For batteries however, we need to create a system that provides an output subsidy of, say, 20€ per kWh of battery manufactured in the EU, for our companies to be competitive vis-à-vis US and Chinese higher level of public subsidy. 

The Clean Industrial Deal of the European Commission is a welcomed step in the right direction. But we need an investment arm to that Deal. Europe needs a cleantech investment plan, coordinated at EU level, deployed with Member States.

The European Parliament’s resolution on the Clean Industrial Deal (CID), adopted in June, rightly identifies this as a strategic priority by asking the European Commission to launch both a structural dialogue and an investment plan for cleantech manufacturing in Europe. 

While we work on providing more investment certainty through a cleantech investment plan, we also need to refrain from creating regulatory uncertainty. As Donald Trump is generating policy uncertainty on a massive scale, we Europeans need to play to our strengths: stable and ambitious regulations that provide certainty to industries and financial partners. 

Rolling-back important legislation, such the 2035 target set in the CO2 standards for cars regulation, would generate uncertainty, leading to the destruction of clean industrial jobs. True, carmakers are facing headwinds due to inconsistent fiscal policy choices, especially in Germany and France. But the answer to this should be the deployment of a European social leasing scheme that would help millions of hard-working Europeans from our rural areas to access cheap electric cars made in Europe. 

Europe faces a fundamental choice. 

If Europe were to retreat, to roll-back the regulations and refrain from adopting a cleantech investment plan, Europe would cling to a fossil-fuelled past, manage industrial decline and leave technological leadership to China. 

If Europe were to choose to lead, to preserve its regulatory stability and build the investment plan its industry so desperately need, Europe would gain more geopolitical power, create jobs while protecting the environment, and allowing other democracies in the work the option to work with European democracies rather than authoritarian China. 

Now is the time for Europe to lead, not retreat.