Carlo Stagnaro, Cécile Philippe, Christian Năsulea, Diana Năsulea, Line Andersen, Marcin Zieliński, Otto Brøns-Petersen, Radovan Ďurana, Radu Nechita, William Hongsong Wang // 25 February 2025

The report "Energising Europe: A Market Approach to Clean and Abundant Energy" examines how the European Union can achieve its climate objectives through market-driven approaches rather than heavy-handed regulation. As the EU pursues ambitious environmental targets, the report argues that current policy frameworks often create inefficiencies and unnecessary costs, whilst potentially hindering effective climate action.

The report analyses key areas of EU climate policy, highlighting how market mechanisms and technological neutrality could accelerate the energy transition. It particularly scrutinises the current emissions trading system, energy market structure, and the role of emerging technologies in achieving climate goals.

Key findings of the report include:

• The existing dual emissions trading system creates unnecessary complexity and should be merged into a single, comprehensive framework.
• Current sector-specific regulations, such as the 2035 ban on internal combustion engines, risk increasing costs without improving environmental outcomes.
• Government intervention in energy markets, including price controls and technology preferences, distorts competition and hampers innovation.
• The Black Sea region presents significant opportunities for reducing EU dependency on Russian gas through domestic production.
• Nuclear power, particularly small modular reactors, offers a viable path to decarbonisation but faces unnecessary regulatory hurdles.
• Carbon capture technologies require integration into emissions trading frameworks to drive investment and development.

The report calls for a fundamental rethinking of EU climate policy, emphasising market mechanisms over prescriptive regulation. It advocates for removing bureaucratic barriers, enhancing energy market competition, and establishing technology-neutral frameworks that allow various solutions to compete based on their merits. These reforms are presented as essential for achieving climate objectives whilst maintaining economic competitiveness and energy security.