Continuing transition to clean power is key to competitiveness

The transformation of the European power sector faced many potential stumbling blocks in 2024. Inflation remained above historic levels – creating challenging conditions for investment – and many national and European elections bred concerns that the transition to clean energy would lose support. On the contrary, progress continued at pace.

The strategic, economic and social case for the energy transition in Europe is clearer than ever. While the worst of the energy crisis might be over, Europe’s ongoing dependence on fossil energy leaves it vulnerable to global shocks in an increasingly volatile world. European citizens – still suffering high energy prices caused by Russian aggression in Ukraine – are increasingly feeling the impacts of the climate crisis, from record summer heatwaves to extreme flooding. Not only are renewables addressing these problems by reducing emissions, they are the cheapest solutions available and are overwhelmingly popular. 

As political attention shifts to Europe’s industrial and economic performance, some may argue for sustainability to be deprioritised. Conversely, the report by former European Central Bank President Mario Draghi on the future of European competitiveness concludes the best route is through reduced fossil fuel dependency, confirming that industrial policy must be rooted in the energy transition. The return of President Trump to the White House and the likely US retreat from clean energy leadership presents a clear opportunity for the EU to step up.

In this context, it is welcome to see continued commitment to the European Green Deal from the new EU Commission, as citizens and businesses stand to benefit from a faster transition. This report outlines what happened in EU electricity in 2024, the progress made during five years of the European Green Deal and key priorities to unlock further advances.