The new Energy Union: cleaner, cheaper and more connected
The EU must build on its strengths and unleash the full value of its Energy Union. We cannot afford to wait a moment longer
The European Union is at a crucial turning point for its competitiveness, decarbonisation and security, with a clear need to act.
High energy bills are hurting our homes and businesses. In his 2024 report on European competitiveness, Mario Draghi mentions “energy” over 700 times. We cannot have a stronger Europe without stronger cooperation on energy, providing the basis for jobs, growth and prosperity.
And the need for a stronger Europe could not be more urgent. On our borders, Russian brutality shakes the foundations of European security. Since Vladimir Putin began his invasion, Europe has spent the equivalent of the cost of 2,400 F-35 fighter jets on fossil fuels from Russia. This cannot continue.
As we strive to protect our continent, we must also protect our planet. The energy sector accounts for 75% of Europe’s greenhouse gas emissions. The longer it takes to decarbonise, the longer we are exposed to volatility – in the prices of fossil fuels and the crises of climate change.
Our challenges are significant. But so is the ability of the European Union to address them. On February 26, I presented an EU Action Plan to unlock the full value of our Energy Union. Let me break down what we are doing and what it will mean for you.
First of all, when it comes to the green transition, we are not backtracking; we are fast tracking. Today, across Europe, wind turbines and solar farms have been waiting years to be built. Hundreds of gigawatts of green, affordable energy are waiting to be unleashed. We cannot wait any longer.
We will, therefore, cut the permitting delays that hold back the development of renewable projects – enabling a more rapid delivery of affordable green energy for Europeans. We will also make it easier to take up longer-term contracts for renewable energy, to ensure that buyers of clean electricity are shielded from short-term volatility in energy markets.
Another key area of focus will be to strengthen and streamline our Energy Union. Today, we are only using half the potential of our grids – it is as if Europe had 100 highways but only use 50, and will need 200 in the future. The Commission will, therefore, lead closer coordination between member states in the governance of energy markets, the planning of grid developments and in preparation for crises.
We will also direct shared and strategic European investments to advance efficiency, electrification and modernisation. To further support investments, we will establish a tripartite contract for affordable energy, linking the public sector, clean energy developers and producers and the energy consuming industry. It’s a matter of enhancing scale and ensuring predictability.
Where once we were divided by trenches and the Iron Curtain, now we are connected, by power lines, cables and interconnectors
Finally, as we decarbonise our economy, demand for gas is declining but it will remain a significant part of our energy mix for some time. Our Action Plan, therefore, targets fairer gas markets by improving regulatory oversight and equipping authorities with strong legal powers to sanction market abuses. We also aim for more competitive gas markets, for example, by leveraging EU purchasing power to get a better deal for imports from reliable LNG suppliers.
What does all of this mean for homes and businesses in Europe? Taken together, we have the potential to deliver €45 billion in savings in 2025, growing to at least €130 billion in annual savings by 2030 and to €260 billion annually as of 2040. Overall, between now and 2040, we can save up to €2.5 trillion on fossil fuel imports.
These savings are within our grasp – we cannot let them slip through our fingers. We must work together: the EU, member states, the private sector and citizens. By combining our efforts, we can deliver the full potential and fulfil the original promise of Europe, united in diversity and direction.
Almost 70 years ago, Professor Walter Hallstein, first president of the European Commission, spoke of this promise as he set out the prospects for European unity in a world of daunting challenges: “If the great venture is to succeed, what we need is not only intelligence, imagination and determination but, above all, confidence in ourselves and a tough, unyielding will to survive.”
Let us heed these words and have confidence in ourselves. Through unity, we have not just survived – we have thrived.
We began life as a European Coal and Steel Community. We are now a European community of wind turbines, solar panels, and geothermal generators. Where once we were divided by trenches and the Iron Curtain, now we are connected, by power lines, cables and interconnectors.
Now is the moment to complete what we started 70 years ago, to build on our strengths and unleash the full value of our Energy Union. We cannot afford to wait a moment longer.
Dan JørgensenDan Jørgensen is European Commissioner for Energy and Housing.