Even before the Middle East conflict, Europe’s transition to clean energy had hit a speed bump – and things have worsened since 2025. Policy rollback in populist EU states; inability to compete with China on EVs, scale-up of fossil fuels to boost energy security and belief net-zero should be abandoned took hold.
The US administration’s recent revocation of regulations determining greenhouse gases endanger public health will result in significantly increased carbon emissions, especially from that country’s transport sector. Combined with undermining Biden-era measures on renewables, the implications go far beyond its borders, prompting many questions: Could we see an overspill on this side of the Atlantic? If the world’s leading economy is effectively rejecting accepted climate science on the basis of business competitiveness, is Europe likely to follow?
Trump’s anti-climate antics led to many multinationals abandoning their sustainability commitments. The EU scaled back its Corporate Sustainability Reporting Directive (CSRD) with its “Omnibus” package – sold as “a way to boost European competitiveness by reducing onerous compliance burdens”.
The EU emissions trading system is being reviewed to ease burdens on industry. Environmental NGOs say it must be preserved as both “a crucial climate policy instrument and a way to guarantee competitiveness of European clean tech businesses”. Meanwhile, tariffs and trade rows raged as the US pushed its LNG in one-sided negotiations with the EU.
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Recent conflict compounds the difficulties. Geopolitics specialist Tatiana Mitrova of the Centre on Global Energy Policy in New York has noted war in Iran is not just another energy shock. “It is arriving at a moment when Europe is already under cumulative strain: a war on its eastern border, the lingering aftershocks of the 2022 energy crisis, industrial decline, political fragmentation, fiscal limits and a widening debate over how much of its own security it must now provide.”
It tests not only Europe’s energy system but the broader strategic model on which Europe has relied for decades, she wrote in The National Interest.
For years, energy transition was framed mainly as a climate project. The old language of “transition” is no longer sufficient. Europe is not moving through a smooth linear shift from fossil fuels to clean energy, Mitrova said. Today it is something else; “a test of whether Europe can reduce emissions without replacing one dependency with another”.
Europe cannot stop the transition, she concluded. “A continent that still imports 88 per cent of its gas and 93 per cent of its oil would remain strategically exposed if it slowed down now. But it also cannot afford a naive version of decarbonisation that weakens industry, deepens external technology dependence, and mistakes speed for strength.” Europe cannot go back to Russian gas or build long-term security on permanent dependence on American LNG and “cannot decarbonise by outsourcing the next energy system entirely to [a] Chinese cleantech supply chain. The real divide is between a transition that strengthens Europe and a transition that leaves it greener, but weaker.”
We have seen some softening of climate policies to streamline key EU sustainability legislation and reporting requirements, says Mary Whitelaw, chief sustainability officer with AIB.
Framing climate ambition and competitiveness as a trade‑off is a false choice, she says. “Sustainability shouldn’t be viewed as a drag on growth but as a driver of long‑term resilience and value creation. Competitiveness for the region would be best secured by sticking with the green transition, particularly because of Europe’s over-reliance on imported fossils.”
While pace and policy may have to fluctuate, fundamentals of a thriving region – cost competitiveness, security of energy supply as well as mitigation and adaptation to climate risk – are calling out for acceleration, Whitelaw adds.
The EU has expanded its renewable energy deployment since the start of the Ukraine war, with wind and solar generating more electricity than fossil fuels for the first time in 2025. “However, there are headwinds, not least of which are those created by the current war in the Middle East. Unfortunately, the region, despite increased renewables, faces this new crisis with continued dependence on imported and expensive fossils,” she says.
The Iran shock has revealed Europe does not need the fastest green transition on paper, Mitrova said; “it needs the fastest move toward a more resilient, flexible, and protected energy system”, and to include:
- A safer and more diversified hydrocarbon cushion during the transition
- Faster expansion of domestic low-carbon power
- Much more investment in grids, storage, flexibility and efficiency
- A serious industrial strategy behind it
“Green energy is central to this shift, but only if introduced intelligently – as part of a broader architecture of resilience, not as a new layer of strategic vulnerability … The goal is not the fastest green transition; the goal is the fastest SECURE transition,” Mitrova posted on LinkedIn.
Sustainable Ireland Special Report
- This year has been marked by war on multiple fronts, and a glaring lack of energy independence has become evident over a few short weeks. A green revolution, however, presses on: Ireland has made remarkable progress in solar generation, which is becoming an important presence in its energy mix, writes Kevin O’Sullivan, former editor of The Irish Times. Read more.
- In theory, it should be a slam dunk for electric buses to be cheaper to operate than diesel buses. If we were talking about private cars, then the maths is incredibly straightforward. When it comes to electric buses, however, the balance of cost seems less clear, writes Neil Briscoe, a contributor specialising in motoring. Read more.
- Trump’s anti-climate antics have led to many multinationals abandoning their sustainability commitments; however, Europe has no option but to push on with the green energy transition, writes Kevin O’Sullivan. Read more.
- As energy security concerns drive urgent demand for renewable gas, Ireland aims to scale biomethane by 2030; but policy, pricing and regulatory barriers must be resolved to unlock its potential, writes Edel Corrigan. Read more.
Despite geopolitical volatility, Whitelaw says Europe is in a strong position to continue to double down on sustainability and energy security through scaling renewables. “This means implementing the recommendations of Enrico Letta and Mario Draghi as the best way to strengthen growth, innovation and competitiveness for the region in the long run.”
US deregulation and withdrawal from multilateral climate frameworks and other international organisations is a setback but not a fatal one, Whitelaw says, as “progress does not hinge on one jurisdiction, but on collective resolve across many regions and across many sectors, including business”.
The European Union and the Republic – as holder of the EU presidency from July – are in a strong position to step into the breach and hold firm on sustainability and climate commitments, she adds. “Europe is really well positioned to reinforce UN multilateral systems, even where political support elsewhere has weakened, showing that climate leadership is a source of stability, resilience and competitiveness.”
