EU Won't Abandon ETS. A Lesson from the Iran War? Bet on Green Energy

As reported by Rzeczpospolita, the European Union remains steadfast in its commitment to the Emissions Trading System (ETS) and is accelerating its transition towards green energy, a strategy reinforced by geopolitical events. EU Energy Commissioner Dan Jørgensen highlighted the significant reduction in the bloc's dependence on imported fossil fuels, a move that has saved billions but still leaves the EU vulnerable to external shocks and high energy prices. He noted that European energy costs are currently two to three times higher than in the US and China, a disparity that threatens economic competitiveness. Jørgensen emphasized that countries with well-developed renewable energy infrastructure and strong interconnections enjoy lower prices. The war in Ukraine and recent Middle East tensions have added urgency to the climate agenda, making renewable energy development a dual strategy for both climate action and energy affordability. The EU is on track to meet its 2030 target of 45% renewable energy, with current contributions at 27%, and is exploring innovative cross-border investments in renewables to further bolster energy independence and security.

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We are in a better situation than after the Russian invasion of Ukraine in February 2022, our dependence on imported fossil fuels has fallen. But despite this, we remain exposed to external shocks.