Climate, Energy & Natural Resources

The European Green Deal was centre stage of the six European Commission priorities for 2019-2024. The previous mandate focused on the preparation and approval of most of the legislation composing the European climate agenda. In 2025, the mid-point of climate action, various actors have warned that the new institutional cycle must now be focused on the implementation of all these legislative files.  

This comes at a moment when the priorities of the new institutional cycle of ‘enhancing defence’, ‘improving security’, and ‘strengthening competitiveness’, signal a departure from one of the core objectives of the previous five years.  

How can the EU priorities of competitiveness, security, and fairness be achieved in tandem with more ambitious climate action? While shifting the narrative to integrate these new dimensions, the political guidelines of Ursula von der Leyen’s mandate for 2024-2029 have committed to define a pathway to meet the interim target of 90% emissions reductions by 2040. 2025 will be a critical year for the future of climate and energy policy. With von der Leyen announcing a new Clean Industrial Deal within the first 100 days of the mandate, Friends of Europe will strive to link the achievement of climate action goals with the development of European industrial competitiveness. 

The price of energy is paramount for European industrial capacity and citizens’ cost of living. Energy costs in Europe are much more expensive compared to other major players due to a lack of natural resources, lack of collective bargaining power, and delays in clean energy infrastructure development.  

In addition, energy prices and transition risks affect European Member States in a very different way. Such geographical divides will require an EU-wide strategy to ensure it does not exacerbate the asymmetries across countries and that the alignment of private and public finance includes a strong focus on a just transition for the areas most dependent on high-emitting sectors. 

Being coherent with the green and digital transition will be essential to avoid tackling them in silos. With energy being the backbone of European competitiveness, energy prices stand in the way of making production more digital, as artificial intelligence (AI) is highly energy-intensive. The International Energy Agency (IEA) forecasts that we are moving at speed into the Age of Electricity, with global electricity demand showing vast increases driven by light industrial consumption, electric mobility, cooling, and data centres and AI). European competitiveness in high-tech industries will depend on a robust energy market. 

In 2025, the Paris Agreement will turn ten-years old. While political priorities may be shifting in the EU, the planet continues to warm. The impacts of climate change are playing out in real time. In this regard, many sources point out that citizens are increasingly interested in addressing climate change. Almost 4 in 10 EU citizens are personally exposed to environmental and climate-related risks. In addition, according to a survey by the European Investment Bank (EIB), 94% of European respondents believe it is important for their country to focus on climate adaptation. Pointing in the same direction, data collected by Debating Europe, the citizen engagement unit of Friends of Europe, shows a strong willingness among European citizens to adapt lifestyles, change consumption habits, and embrace new technologies to stop climate breakdown.  

The negotiations around the following Multiannual Financial Framework will have important consequences on the priorities of the European Union and how to allocate its budget. Budget considerations will be crucial in the new institutional cycle, as the European Central Bank warns that the continent should focus on increasing productivity and improving growth to reach its ambition in defence, tackling climate change and preserving the welfare state. For instance, considering the importance of the Common Agricultural Policy has in the European budget, the negotiations will have significant consequences for the security and sustainability of the food sector.  

The landmark EU ETS 2 will begin with monitoring and reporting of emissions from buildings, road transport and additional sectors. These questions highlight points that are very relevant in delivering a Just Transition, as it touches upon dimensions that are very present in citizens’ lives.