Europe finds itself at a critical juncture, besieged by a convergence of geopolitical, economic, environmental, and technological pressures that threaten to reshape its strategic landscape. Russia’s war on Ukraine has laid bare the continent’s energy fragilities, while intensifying competition from the United States and China is exposing vulnerabilities in Europe’s industrial and digital foundations.
The mood across boardrooms and ministries is increasingly apprehensive.
Against this backdrop, policymakers, industry leaders, and energy stakeholders convened at the PKEE Energy Day earlier this month – not merely to diagnose the malaise, but to chart a course through it. Ideas were plentiful; consensus, however, remains elusive.
“To have proper EU competitiveness, we need to stop competing among ourselves; we should stop the competition among member states,” said centre-left Bulgarian MEP Tsvetelina Penkova, vice-chair of the European Parliament’s energy committee.
“There are two ways to do that,” she said, “The first one is to actually create a properly functioning European energy union via the connected grid infrastructure across the EU. And the second point is to accept a technology-neutral principle, which means that the energy mix of the EU should be quite balanced and we should use everything we have available.”
Energy security
Denmark, which currently holds the rotating presidency of the EU, has put energy security and competitiveness at the heart of its agenda.
On 23 October, EU prime ministers and presidents discussed the issue of climate and competitiveness at the European Council Summit in Brussels. In exchange for the Commission agreeing to revise some climate laws, including the new Emissions Trading System for transport and buildings, they agreed to sign off on the proposed target of 90% emissions reduction by 2040.
Polish Prime Minister Donald Tusk called it a “turning point” in the EU’s approach to climate policy, with a new focus on flexibility in energy choices. “Europe is finally speaking our language,” he said.
The previous week, business leaders at Energy Day expressed similar sentiments. “The biggest challenge for energy in the EU is the same as for the Polish energy sector: how to achieve competitiveness, how to achieve ambitious climate objectives with competitiveness and low energy prices,” said Dariusz Marzec, president of the Management Board of the Polish electricity association PKEE. “The dilemma is how to align those two sometimes contradictory objectives.”
Affordable, clean, secure
Mechthild Wörsdörfer, deputy director general of the European Commission’s energy department, said at the event that the Commission is taking these concerns seriously.
“In the current geopolitical context, we need to make sure that we are not dependent on one country,” she said. “So we have made a proposal to phase out Russian gas everywhere in Europe – Poland has already done it. And then we will concentrate also to make our system as affordable, clean and secure as possible.”
“We already have an increasing share of renewables in all of our EU member states, some are investing in nuclear, and then what we are proposing at the EU level right now is that we also have more interconnection to link where the renewables are produced and where they are consumed. So our clear objective is to strengthen the competitiveness, to make sure our supplies are secure, but also affordable and clean.”
Stakeholders at the event also gave their assessment of Mario Draghi’s landmark report on EU competitiveness, one year after it was presented to the European Commission.
Grzegorz Onichimowski, president of the management board of Polish electricity transmission company PSE, said that he thinks there is still a lot of work to be done in implementing Draghi’s recommendations.
“We need to save European industry – that’s the main message,” he said. “How to do it? We don’t have so many fossil fuels, and they’re becoming more and more expensive. They’re being managed by countries we do not like – most of them. So for this reason, I think the energy transformation is inevitable. That’s based on renewables and electrification of the industry.”
“So the fundamentals of it are geopolitical, and of course, also economic. We need to figure out how to do it wisely and not cause too many stranded assets in a reality where technologies are changing fast. This is the biggest challenge for Europe – how to transform and not to waste money.”
(BM)
