COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCIL, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK A Clean Planet for all A European strategic long-term vision for a prosperous, modern, competitive and climate neutral economy
Date: 2018-11-28
Institutions: Directorate-General for Climate Action, European Commission
Subjects: EU energy policy, EU strategy, adaptation to climate change, clean technology, climate change, environmental impact, green economy, reduction of gas emissions, renewable energy, sustainable development

EN 

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   EUROPEAN COMMISSION  Brussels, 28.11.2018  COM(2018) 773 final  COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCIL, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK A Clean Planet for all       A European strategic long-term vision for a prosperous, modern, competitive and climate neutral economy                                     
 
 
INTRODUCTION – THE URGENCY TO PROTECT THE PLANET  

1. 
Climate  change  is  a  serious  concern  for  Europeans1.  The  current  changes  in  our  planet's 
climate are redrawing the world and magnifying the risks for instability in all forms. The last 
two decades included 18 of the warmest years on record. The trend is clear. Immediate and 
decisive climate action is essential.  

The impact of global warming is transforming our environment, increasing the frequency and 
intensity of  extreme  weather  events. Europe  experienced  extreme  heat waves in four of  the 
last five years. This past summer, temperatures above the Arctic Circle were 5C higher than 
usual.  Large  parts  of  Europe  suffered  from  severe  droughts  while  flood  events  have 
particularly  affected  Central  and  Eastern  Europe  in  recent  years.  Climate  related  extremes 
such  as  forest  fires,  flash  floods,  typhoons  and  hurricanes  are  also  causing  massive 
devastation and loss of lives, as hurricanes Irma and Maria proved in 2017 when they hit the 
Caribbean,  including  a  number  of  European  outermost  regions.  This  is  now  affecting  the 
European continent with storm Ophelia in 2017 being the first strong East Atlantic hurricane 
ever to reach Ireland and in 2018 storm Leslie bringing destruction to Portugal and Spain.  

The Intergovernmental Panel on Climate Change (IPCC) issued in October 2018 its Special 
Report  on  the  impacts  of  global  warming  of  1.5°C  above  pre-industrial  levels  and  related 
global  greenhouse  gas  emission  pathways.  Based  on  scientific  evidence,  this  demonstrates 
that human-induced global warming has already reached 1°C above preindustrial levels and 
is  increasing  at  approximately  0.2°C  per  decade.  Without  stepping  up  international  climate 
action,  global  average  temperature  increase  could  reach  2C  soon  after  2060  and  continue 
rising afterwards.  

Such  unconstrained  climate  change  has  the  potential  to  turn  the  Earth  into  a  “hothouse”, 
making large-scale irreversible  climate impacts  more likely. The  IPCC report confirms that 
approximately  4%  of  the  global  land  area  is  projected  to  undergo  a  transformation  of 
ecosystems  from  one  type  to  another  at  1ºC  of  global  warming,  increasing  to  13%  at  2°C 
temperature change. For example, 99% of coral reefs are projected to disappear globally at a 
temperature increase of 2ºC. Irreversible loss of the Greenland ice sheet could be triggered at 
around 1.5°C to 2°C of global warming. This would eventually lead to up to 7 meters of sea 
level  rise  affecting  directly  coastal  areas  around  the  world  including  low-lying  lands  and 
islands in Europe. The rapid loss of Arctic sea ice during summer is already happening today, 
with  negative  impacts  on  biodiversity  in  the  Nordic  region  and  the  livelihood  of  the  local 
population.  

This  would  also  have  severe  consequences  on  the  productivity  of  Europe's  economy, 
infrastructure,  ability  to  produce  food,  public  health,  biodiversity  and  political  stability. 
Weather-related  disasters  caused  a  record  €  283  billion  in  economic  damages  last  year  and 
could affect about two-thirds of the European population by 2100, compared with 5% today. 
For instance annual damages due to river floods in Europe could reach € 112 billion, from the 
current €5 billion.  16%  of the  present  Mediterranean climate zone  may  become  arid by  the 
end  of  the  century  and  in  several  Southern  European  countries  outdoor  labour  productivity 
may decline by around 10-15% from present-day levels. It is also estimated that reductions in 
projected  food  availability  are  more  significant  at  2ºC  than  at  1.5°C  of  global  warming, 
including in regions of key importance to EU security such as Northern Africa and the rest of 

1 According to the Eurobarometer report on climate change, published in September 2017, around three-quarters 
of European Union (EU) citizens (74%) consider climate change to be a very serious problem and  more than 
nine in ten (92%) see it as a serious problem. 

2 

 
 
                                                           
the  Mediterranean.  This  could  undermine  security  and  prosperity  in  the  broadest  sense, 
damaging economic, food, water and energy systems, and in turn triggering further conflicts 
and  migratory  pressures.  Overall,  failing  to  take  climate  action  will  make  it  impossible  to 
ensure  Europe’s  sustainable  development  and  to  deliver  on  the  globally  agreed  UN 
Sustainable Development Goals. 

Figure 1. Climate change impacts in Europe 

2. 

A  EUROPEAN  VISION  FOR  A  MODERN,  COMPETITIVE,  PROSPEROUS  AND  CLIMATE 
NEUTRAL ECONOMY 

The  aim  of  this  long-term  strategy  is  to  confirm  Europe's  commitment  to  lead  in  global 
climate  action  and  to  present  a  vision  that  can  lead  to  achieving  net-zero  greenhouse  gas 
emissions by 2050 through a socially-fair transition in a cost-efficient manner. It underlines 
the opportunities that this transformation offers to European citizens and its economy, whilst 
identifying challenges ahead. The proposed Strategy does not intend to launch new policies, 
nor  does  the  European  Commission  intend  to  revise  2030  targets2.  It  is  meant  to  set  the 
direction of travel of EU climate and energy policy, and to frame what the EU considers as its 
long-term contribution to achieving the Paris Agreement temperature objectives in line with 
UN Sustainable Development Goals, which will further affect a wider set of EU policies. The 
Strategy opens a thorough debate involving European decision-makers and citizens at large as 

2 European Commission Work Programme for 2019 (COM (2018)800), page 4.  

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to how Europe should prepare itself towards a 2050 horizon and the subsequent submission 
of the European long-term Strategy to the UN Framework Convention on Climate Change by 
2020.   

The  EU  has  been  at  the  forefront  of  addressing  the  root  causes  of  climate  change  and 
strengthening  a  concerted  global  response  in  the  framework  of  the  Paris  Agreement.  The 
Paris  Agreement,  ratified  by  181  parties,  requires  strong  and  swift  global  action  to  reduce 
greenhouse  gas  emissions,  with  the  objective  to  hold  global  temperature  increase  to  well 
below 2°C and to pursue efforts to limit it to 1.5°C. It also has the goal to achieve a balance 
between emissions by sources and removals by sinks of greenhouse gases on a global scale in 
the  second  half  of  this  century.  All  parties  are  to  present  long-term  low  greenhouse  gas 
emission development strategies by 2020 that deliver on its objectives. 

The European Council, in June 2017, strongly reaffirmed the commitment of the EU and its 
Member  States  to  swiftly  and  fully  implement  the  Paris  Agreement,  underlining  that  the 
Agreement "is a key element for the modernisation of the European industry and economy" 
and subsequently, in March 2018, invited the European Commission "to present by the first 
quarter  of  2019  a  proposal  for  a  Strategy  for  long-term  EU  greenhouse  gas  emissions 
reduction in accordance with the Paris Agreement, taking into account the national plans".  

In October 2017 the European Parliament also invited the European Commission "to prepare 
by  COP24  a  mid-century  zero  emissions  strategy  for  the  EU".  Finally,  the  Regulation  on 
Governance of the Energy Union agreed by the European Parliament and Council calls on the 
Commission to present an EU long-term strategy by April 2019.3  

The  EU,  responsible  for  10%  of  global  greenhouse  gas  emissions,  is  a  global  leader  in  the 
transition  towards  a  net-zero-greenhouse  gas  emissions  economy.  Already  in  2009,  the  EU 
set  its  objective  to  reduce  emissions  by  80-95%  in  2050.4  Europeans  have  managed  to 
successfully  decouple  greenhouse  gas  emissions  from  economic  growth  in  Europe  for  the 
past decades. Following the peak in EU greenhouse gas emissions in 1979, energy efficiency, 
fuel  switch  policies  and  the  penetration  of  renewables  reduced  emissions  significantly.  In 
consequence, between 1990 and 2016, energy use was reduced by almost 2%, greenhouse gas 
emissions by 22% while GDP grew by 54%.   

The clean energy transition has spurred the modernisation of the European economy, driven 
sustainable  economic  growth  and  brought  strong  societal  and  environmental  benefits  for 
European  citizens.  The  EU's  pursuit  to  achieve  its  2020  energy  and  climate  targets  already 
delivered  new  industries,  European  jobs  and  increased  technological  innovation,  driving 
down  technology  costs.  The  renewable  energy  revolution  is  the  best  example  of  this.  The 
share of  renewable  energy in final energy consumption  increased  from 9% in 2005 to 17% 
today.  EU  leadership  demonstrates  to  other  parts  of  the  world  that  this  transition  is  both 
possible and beneficial beyond the fight against climate change. 

The EU is broadly on track to achieve its 2020 greenhouse gas, renewable energy and energy 
efficiency  targets.  However,  continued  focus  is  necessary  in  order  to  overcome  the  recent 
stagnation of energy efficiency improvements and greenhouse gas emission reduction trends.  

The EU is advancing with its Energy Union Strategy and finalising a modern, advanced and 
cost-effective regulatory framework to achieve its 2030 greenhouse gas reduction targets and 
its  clean  energy  transition  delivering  on  the  Juncker  Commission's  objective  to  put  energy 

3 Art (15) of the Regulation on the Governance of the Energy Union and Climate Action.  
4 In the context of necessary reductions of the developed countries as a group. 

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efficiency  first  and  become  a  global  leader  in  renewables.  This  is  an  investment  in  our 
prosperity  and  in  the  sustainability  of  the  European  economy.  Regulatory  stability  is  an 
important  element  for  public  authorities  and  private  operators  alike  to  achieve  full 
implementation  of  this  framework. Ambitious  policies have been agreed at European level, 
including a reformed EU emissions trading system strengthening the price signal for CO2. For 
all  other  sectors,  national  greenhouse  gas  emission  reduction  targets  have  been  set  and 
legislation established to maintain the EU land and forests sink which absorbs more CO2 than 
it emits. On the side of energy, the targets to improve the EU's energy efficiency by at least 
32.5% and to increase renewable energy to at least 32% of the EU's final energy consumption 
by  2030  are  now  approved  and  the  proposed  legislation  to  improve  the  CO2  efficiency  of 
cars, vans and trucks will spur the transition in the transport sector. 

Combined, these climate and energy policies will deliver on the EU's contribution under the 
Paris  Agreement  to  reduce  emissions  by  at  least  40%  by  2030  compared  to  1990.  In  fact, 
when  the  agreed  EU  legislation  is  fully  implemented,  total  greenhouse  gas  emission 
reductions are estimated to reach around 45% by 2030. The policies put in place today will 
have a continued impact after 2030 and will therefore already go a long way, with projected 
emissions reductions of around 60% by 2050. This is, however, not sufficient for the EU to 
contribute to the Paris Agreement's temperature goals.  

The IPCC report confirms that the world needs to limit climate change to 1.5°C to reduce the 
likelihood of extreme weather  events.  It  also emphasises that emissions need to be reduced 
with far more urgency than previously anticipated. In order to limit temperature increase to 
1.5°C,  net-zero  CO2  emissions  at  global  level  needs  to  be  achieved  around  2050  and 
neutrality  for  all  other  greenhouse  gases  somewhat  later  in  the  century.  At  this  point,  any 
remaining  greenhouse  gas  emissions  in  certain  sectors  need  to  be  compensated  for  by 
absorption in other sectors, with a specific role for the land use sector, agriculture and forests. 
This provides an opportunity for the EU to step up its action to show leadership and reap the 
benefits  of  first  mover  advantage.  This  would  require  the  EU  to  achieve  greenhouse  gas 
emissions neutrality by 2050. 

The status quo is not an option. Countries should act together to protect their citizens against 
climate  change.  Delivering  on  the  transformation  towards  a  net-zero  greenhouse  gas 
emissions  economy  thus  requires  early  long-term  planning,  improving  knowledge  of  the 
opportunities for transforming our entire economy and building trust within our society and 
all economic actors that this change is possible and opportune.  

The  IPCC  report  provides  us  with  this  encouraging  message:  limiting  global  temperature 
increase  to  1.5°C  is  doable,  provided  we  act  now  and  coherently  use  every  tool  at  our 
disposal. The strong scientific basis of the IPCC report to decision makers across the globe 
for  tackling  climate  change,  modernising  the  economy,  promoting  sustainable  development 
and eradicating poverty has been duly taken into account by the European Commission when 
preparing this EU Strategy for long-term greenhouse gas emission reduction. 

The  Strategy  therefore  outlines  a  vision  of  the  economic  and  societal  transformations 
required,  engaging  all  sectors  of  the  economy  and  society,  to  achieve  the  transition  to  net-
zero greenhouse gas emissions by 2050. It seeks to ensure that this transition is socially fair – 
not  leaving  any  EU  citizens  or  regions  behind  –  and  enhances  the  competitiveness  of  EU 
economy and industry on global markets, securing high quality jobs and sustainable growth 
in Europe, while providing synergies with other environmental challenges, such as air quality 
or biodiversity loss. 

5 

 
 
To  do  so,  the  Strategy  looks  into  the  portfolio  of  options  available  for  Member  States, 
business  and  citizens,  as  well  as  into  how  these  can  contribute  to  the  modernisation  of  our 
economy and improve the quality of life of Europeans, protect the environment, and provide 
for jobs and growth.  

3.  PATHWAYS  FOR  THE  TRANSITION  TO  A  NET-ZERO  GREENHOUSE  GAS  EMISSIONS 
ECONOMY AND STRATEGIC PRIORITIES 

The threats and risks of climate change are known, and so are many  ways to prevent them. 
This Strategy provides a number of solutions that could be pursued for the transition to a net-
zero  greenhouse  gas  emissions  economy  by  mid-century.  These  options  will  radically 
transform our energy system, land and agriculture sector, modernise our industrial fabric and 
our transport systems and cities, further affecting all activities of our society. In this context, 
citizens play a central role. Climate change can only be tackled if people actively engage, as 
consumers  and  as  citizens.  The  success  of  the  transformation  will  also  depend  on  how  our 
society takes care of those who are more vulnerable during this transition.   

The transition towards a net-zero greenhouse gas economy gives energy a central role as it is 
today  responsible  for  more  than  75%  of  the  EU's  greenhouse  gas  emissions.  In  all  options 
analysed, the energy system moves towards net-zero greenhouse gas emissions. It relies on a 
secure  and  sustainable  energy  supply  underpinned  by  a  market-based  and  pan-European 
approach.  The  future  energy  system  will  integrate  electricity,  gas,  heating/cooling  and 
mobility systems and markets, with smart networks placing citizens at the centre. 

The  transition  also  requires  further  scaling-up  of  technological  innovations  in  energy, 
buildings, transport, industry and agriculture sectors. It can be accelerated by breakthroughs 
in  digitalisation,  information  and  communications,  artificial  intelligence  and  biotechnology. 
The  expansion  of  new  systems  and  processes,  with  cooperation  across  sectors,  is  also 
required. A good example of such system-oriented approaches is the circular economy, which 
will  harness  a  range  of  advanced  solutions  and  foster  new  business  models.  It  will  also 
require cooperation at different levels among regions and among Member States to maximise 
synergies  by  pooling  resources  and  knowledge  together.  European  manufacturing  is  still 
competitive today, but is also under pressure from both developed and emerging economies. 
Yet,  Europe  is  at  the  top  of  the  league  when  it  comes  to  new  high-value  patents  for  low-
carbon energy technologies, is seen as a global leader in these sectors and has to transform 
this  scientific  advantage  in  commercial  success.  Delayed  and  uncoordinated  action  would 
increase the risks of lock-in to carbon intensive infrastructure and stranded assets and make 
this inevitable transformation costlier.  

The portfolio of options is based on existing, though in some cases emerging, solutions and is 
large  enough  to  offer  alternatives  to  assure  policymakers  and  our  citizens  that  a  net-zero 
greenhouse  gas  emissions  economy  can  be  reached  by  mid-century.  The  assessment  builds 
upon  scientific  literature  and  inputs  from  a  wide  range  of  stakeholders  –  business,  non-
governmental organisations, think tanks and the research community – as well as integrated 
modelling  allowing  to  better  understand  the  transformation  of  and  complex  interactions 
between the energy, industry, buildings, transport, agriculture, forestry and waste sectors.  

The  starting  point  of  the  analysed  pathways  is  a  common  baseline  reflecting  the  2030  energy  and  climate 
policies  and  targets  as  recently  agreed  as  well  as  the  Regulation  on  Governance  of  the  Energy  Union  and 

Overview of the analysed scenarios 

6 

 
 
 
Climate  Action.5  This  includes  a  reformed  EU  emissions  trading  system,  national  greenhouse  gas  emission 
reduction  targets,  legislation  to  maintain  the  EU  land  and  forests  sink,  the  agreed  2030  targets  on  energy 
efficiency and renewable energy, as well as the proposed legislation to improve the CO2 efficiency of cars and 
trucks. These policies and targets are projected to reach reductions of greenhouse gas emissions of around -45% 
by 2030 and around -60% by 2050. This is not sufficient for the EU to contribute to the long-term temperature 
goas  set  in  Paris  Agreement.  To  achieve  those  goals,  eight  additional  pathways  –  all  in  line  with  the  Paris 
Agreement – were assessed.  

The  eight  scenarios  build  upon  no  regret  policies  such  as  strong  usage  of  renewable  energy  and  energy 
efficiency.  

Five of them look at different technologies and actions which foster the move towards a net-zero greenhouse gas 
economy. They vary the intensity of application of electrification, hydrogen and e-fuels (i.e. power-to-X) as well 
as end  user energy efficiency and the role of a circular economy, as actions  to reduce  emissions. This allows 
exploring their common features as well as different impacts on the energy system.  

In all these pathways electricity consumption increases, but notable differences exist. Pathways that focus more 
on electrification in end-use sectors see also need for high deployment of storage (6 times today's levels) to deal 
with variability in the electricity system; but pathways which deploy more hydrogen require more electricity to 
produce the hydrogen in the first place. Pathways that use the highest amounts of electricity are those that see 
the  expansion  of  e-fuels,  resulting  in  almost  150%  more  electricity  production  in  2050  compared  to  today. 
Instead, pathways that address the demand side, such as high end-use energy efficiency or the circular economy, 
require the least increase in electricity generation (ca. 35% more by 2050 compared to today), the lowest needs 
for storage and the deepest energy savings in the residential or industrial sectors. All these pathways additionally 
see  varying  needs  for  investments  and  transformation  at  sectoral  level.  Pathways  more  reliant  on  carbon-free 
energy carriers require less transformation and investment in the end-use sector, but also the highest investment 
needs  in  the  energy  supply  sectors.  Conversely,  pathways  focused  on  demand  side  change  require  the  least 
investments in the energy supply sectors. 

These  five  scenarios  achieve  just  above  80%  greenhouse  gas  emission  reductions,  excluding  land  use  and 
forestry, by 2050 compared to 1990. Including the sink of land use and forestry sectors which absorb more CO2 
than they emit, these scenarios achieve around 85% net greenhouse emissions reductions by 2050 compared to 
1990. This is still 15 percentage points short of a climate neutral or net-zero greenhouse gas economy. 

The scenario combining  all five options but at lower levels, reaches net  greenhouse gas  reductions as  high as 
90% (including the land use and forestry sink). Still, this scenario does not achieve greenhouse gas emissions 
neutrality  by  2050.  This  is  because  some  greenhouse  gas  emissions  will  remain,  notably  in  the  agriculture 
sector.  The  agricultural  and  forestry  sectors  are  unique  as  they  can  also  remove  CO2  from  the  atmosphere. 
These annual removals today are significant, resulting in a net sink in the EU of around 300 million tonnes of 
CO2.  But  this  is  not  big  enough  to  compensate  for  the  remaining  emissions  without  additional  measures 
strengthening  the  role  of  our  land.  Therefore  additional  action  need  to  be  explored  on  how  biomass  can  be 
supplied  in  a  sustainable  way  while  enhancing  our  natural  sink  or  in  combination  with  carbon  capture  and 
storage that both can lead to increased negative emissions. 

The  seventh  and  eighth  scenarios  therefore  explore  explicitly  these  interactions  to  assess  how  to  reach 
greenhouse  gas  neutrality  (net-zero  emissions)  by  2050  and  net  negative  emissions  thereafter.  The  seventh 
scenario  pushes  all  zero-carbon  energy  carriers  as  well  as  efficiency,  and  relies  on  a  negative  emissions 
technology in the form of bioenergy combined with carbon capture and storage to balance remaining emissions.  

The eighth scenario builds upon the previous scenario but assesses the impact of a highly circular economy and 
the potential beneficial role of a change in consumer choices that are less carbon intensive. It also explores how 
to strengthen the land use sink, to see by how much this reduces the need for negative emissions technologies. 

Modelling assessments indicate that the deployment of no-regret options such as renewables 
including  sustainable  advanced  biofuels,  energy  efficiency,  impetus  towards  circular 

5 COM (2016) 759  

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economy alongside individual options such as electrification, hydrogen and alternative fuels 
or  new  approaches  to  mobility,  are  not  sufficient  for  a  net-zero  greenhouse  gas  emissions 
economy by 2050. Under such technology scenarios, emissions reduce only by 80% by 2050 
compared  to  1990.  While  combining  all  these  options  can  reduce  net  emissions  by  around 
90% (including the land use and forestry sink), some greenhouse gas emissions will always 
remain  notably  in  the  agriculture  sector.  Reaching  net-zero  greenhouse  gas  emissions  will 
require  maximising  the  potential  of  technological  and  circular  economy  options,  the  large 
scale deployment of natural land based carbon sinks including in the agricultural and forestry 
sectors as well as shifts in mobility patterns.  

The road to a net-zero greenhouse gas economy could be based on joint action along a set of 
seven main strategic building blocks:   

1. Maximise the benefits from Energy Efficiency including zero emission buildings 

Energy  efficiency  measures  should  play  a  central  role  in  reaching  net-zero  greenhouse 
emissions  by  2050  reducing  energy  consumption  by  as  much  as  half  compared  to  2005. 
Energy  efficiency  digitalisation  and  home  automation,  labelling  and  setting  standards  have 
effects that go far beyond the EU as appliances and electronics are imported into the EU or 
exported to foreign markets, making producers abroad use the EU standards.  

Energy efficiency will play a central role in decarbonising industrial processes but much of 
the  reduced  energy  demand  will  occur  in  buildings,  in  both  the  residential  and  services 
sectors, which today are responsible for 40% of energy consumption. Given that most of the 
housing  stock  of  2050  exists  already  today,  this  will  require  higher  renovation  rates,  fuel 
switching  with  a  large  majority  of  homes  that  will  be  using  renewable  heating  (electricity, 
district heating, renewable gas or solar thermal), diffusion of the most efficient products and 
appliances,  smart  building/appliances  management  systems,  and  improved  materials  for 
insulation.  Sustainable  renewable  heating  will  continue  to  play  a  major  role  and  gas, 
including liquefied natural gas, mixed with hydrogen, or e-methane produced from renewable 
electricity  and  biogas  mixtures  could  all  play  a  key  role  in  existing  buildings  as  well  as  in 
many  industrial  applications.  To  achieve  and  sustain  higher  renovation  rates,  adequate 
financial instruments to overcome existing market failures, sufficient workforce with the right 
skills and affordability for all citizens are of central importance. An integrated approach and 
consistency  across  all  relevant  policies  will  be  necessary  for  the  modernisation  of  the  built 
environment  and  mobilisation  of  all  actors.  Consumer  engagement,  including  through 
consumer associations, will be a key element in this process.  

2.  Maximise  the  deployment  of  renewables  and  the  use  of  electricity  to  fully  decarbonise 
Europe’s energy supply 

Today  the  major  part  of  the  energy  system  is  based  on  fossil  fuels.  All  scenarios  assessed 
imply that by mid-century this will change radically with the large-scale electrification of the 
energy system driven by the deployment of renewables, be it at the level of end-users or to 
produce carbon-free fuels and feedstock for the industry.  

The clean energy transition  would result in  an energy  system  where primary  energy supply 
would largely come from renewable energy sources, thereby significantly improving security 
of  supply  and  fostering  domestic  jobs.  Europe’s  energy  import  dependence,  notably  as 
regards imports of oil and gas, standing today at ca. 55% will fall in 2050 to 20%. This would 
positively impact EU's trade and geopolitical position as it would result in a sharp reduction 
of fossil fuel import expenditures (currently € 266 billion), with imports falling by over 70% 
in some scenarios. The cumulative savings from a reduced import bill will amount to € 2-3 

8 

 
 
trillion over the period 2031-2050, freeing resources for further potential investments into the 
modernisation of the EU economy.    

The large-scale deployment of renewables will lead to the electrification of our economy and 
to a high degree of decentralisation. By 2050, the share of electricity in final energy demand 
will  at  least  double,  bringing  it  up  to  53%,  and  electricity  production  will  increase 
substantially to achieve net-zero greenhouse gas emissions, up to 2.5 times of today's levels 
depending on the options selected for the energy transition.  

Fundamental progress has already been made in transforming Europe’s electricity production. 
The global expansion of renewable energy, instigated by EU leadership, led to massive cost 
decreases in the last 10 years, in particular in solar and on- and off-shore wind. Today, more 
than half of Europe's electricity supply is free from greenhouse gas emissions. By 2050, more 
than 80% of electricity will be coming from renewable energy sources (increasingly located 
off-shore). Together  with  a nuclear power share of ca. 15%, this will be the backbone of  a 
carbon-free  European  power  system.  These  transitions  are  similar  to  global  pathways 
analysed  in  the  IPCC  report.  Electrification  will  open  up  new  horizons  for  European 
companies in the global clean energy market worth today ca. € 1.3 trillion. Several sources of 
renewable energy are still to be harnessed, notably ocean energy. For the EU, which currently 
hosts 6 of the 25 largest renewable energy businesses and employs almost 1.5 million people 
(out of 10 million worldwide), this will be a unique business opportunity. It will also give an 
important  role  to  consumers  that  produce  energy  themselves  (prosumers),  and  local 
communities to encourage residential take-up of renewables.  

Figure 2. Fuel mix in Gross Inland Consumption 

The  competitive  deployment  of  renewable  electricity  also  provides  a  major  opportunity  for 
the  decarbonisation  of  other  sectors  such  as  heating,  transport  and  industry,  either  through 
direct  use  of  electricity  or  indirectly  through  the  production  of  e-fuels  through  electrolysis 
(e.g. e-hydrogen), when direct use of electricity or sustainable bio-energy is not possible. The 
potential advantage of power-to-X is that synthetic fuels can be stored and used in multiple 

9 

0%10%20%30%40%50%60%70%80%90%100%20162030Baseline2050Average of "wellbelow 2°C" scenarios(-80% emissions)2050Intermediary level ofambition2050Average of "1.5°C"scenarios (net zeroemissions)2050Gross Inland Consumptionnon-energy fossil fuels usesolidsfossil liquidsnatural gasnucleare-liquidse-gasrenewables1639 Mtoe1395 Mtoe1239 Mtoe1255Mtoe1178 Mtoe1192 Mtoe 
 
 
 
ways  across  different  economic  sectors,  where  it  is  otherwise  hard  to  decarbonise  (e.g. 
industry and transport). In niche applications and with a fully decarbonised electricity system, 
these  technologies  could  use  CO2  as  a  feedstock  captured  from  industrial  processes.  If 
captured from sustainable bio-energy or even directly from the air (recognising, however, that 
these  technologies  are  yet  untested  at  scale),  they  have  the  capacity  to  deliver  on  zero 
emissions fuels. 

Hydrogen and Power-to-X (P2X) 

Hydrogen has long been used by the chemical industry as a feedstock in industrial processes. 
Its role is likely to become more prominent in a fully decarbonised  energy system. To play 
this  role,  hydrogen  will  have  to  be  produced  by  water  electrolysis  using  carbon-free 
electricity or from natural gas steam reforming using Carbon Capture and Storage. Hydrogen 
thus  produced  can  then  contribute  to  decarbonise  various  sectors:  first,  as  storage  in  the 
power sector to accommodate for variable energy sources; second, as an energy carrier option 
used in heating, transport and industry and, finally, as a feedstock for industry such as steel, 
chemicals and e-fuels in those sectors that are most difficult to decarbonise.  

Power-to-X  technologies  refer  to  technologies  that  allow  transforming  electricity  into 
synthetic  gases  (hydrogen,  methane  or  other  gases)  and  liquids.  Hydrogen  produced  with 
carbon-free  electricity  combined  with  CO2  from  sustainable  biomass  or  Direct  Air  Capture 
can make a carbon-neutral alternative  of the same  molecules as natural  gas or  oil, and thus 
can  be  distributed  via  existing  transmission/distribution  system  and  used  by  existing 
installations  and  applications.  These  technologies  become  attractive  in  the  context  of 
abundant  electricity  generated  from  carbon-free  sources  (renewables  and  nuclear).  The 
drawback is that their production is energy intensive. 

flexible  system,  building  on  consumers' 

The transition towards a largely decentralised power system based on renewables will require 
a  smarter  and 
increased 
interconnectivity, improved energy storage deployed on a large scale, demand side response 
and  management  through  digitalisation.  The  expansion  and  smartness  of  the  electricity 
system,  production  and  applications  using  power  will  require  keeping  the  adequacy  of  the 
single energy market design high on the energy agenda in the coming decades to achieve zero 
carbon power in a cost-effective way and avoid stranded assets. The transition will also need 
to be safeguarded from any increased cyber security risks. 

involvement, 

3. Embrace clean, safe and connected mobility 

Transport  is  responsible  for  around  a  quarter  of  greenhouse  gas  emissions  in  the  EU.  All 
transport  modes  therefore  need  to  contribute  to  the  decarbonisation  of  the  mobility  system. 
This requires a system-based approach. Low and zero emission vehicles with highly efficient 
alternative powertrains in all modes is the first prong of this approach. Just as for renewable 
energy in the previous  decade,  the  automotive industry already today heavily  invests  in the 
emergence  of  zero  and  low  emission  vehicle  technologies,  such  as  electric  vehicles.  A 
combination  of  decarbonised,  decentralised  and  digitalised  power,  more  efficient  and 
sustainable  batteries,  highly  efficient  electric  powertrains,  connectivity  and  autonomous 
driving offers prospects to decarbonise road transport with strong overall benefits including 
clean air, reduced noise, accident-free traffic, altogether generating major health benefits for 
citizens  and  the  European  economy.  Electrification  of  short  sea  shipping  and  inland 
waterways is also an option, where the power to weight ratio makes it feasible. 

Based on today’s knowledge and technologies, electrification using renewables alone will not 
be the single silver bullet for all transport modes. Batteries have so far a low energy density, 
and for now their high weight makes the technology ill-suited for aviation and long distance 

10 

 
 
shipping. Also for long-haul trucks and coaches it is currently unclear whether batteries will 
reach  the  required  cost  and  performance  level,  though  prospects  exist  to  electrify  with 
catenary lines. Railway  remains  the  most energy efficient solution  for  carrying  freight over 
medium to long distances. Therefore, rail freight should become more competitive compared 
to road transport by eliminating operational and technical barriers between national networks 
and  by  fostering  innovation  and  efficiency  across  the  board.  Until  we  see  emerge  new 
technologies  that  will  allow  to  electrify  more  modes  than  today,  alternative  fuels  will  be 
important.  In  addition,  hydrogen-based  technologies  (such  as  electric  vehicles  and  vessels 
based on fuel cells) may become competitive in the medium to long-term. Liquefied natural 
gas with high blends of bio-methane could also be a short-term alternative for long-distance 
haul.  Aviation  must  see  a  shift  to  advanced  biofuels  and  carbon-free  e-fuels,  with 
hybridisation  and  other  improvement  in  aircraft  technology  having  a  role  in  improving 
efficiency. In long distance shipping and heavy-duty vehicles, not only bio-fuels and bio-gas 
but also e-fuels can have a role provided that they are carbon-free throughout their production 
chain. E-fuels can be used in conventional vehicle engines, relying on the existing refuelling 
infrastructure. Further significant steps in research and development are needed in production 
of  decarbonised  fuels  as  well  as  the  vehicle  technologies  such  as  batteries  fuel  cells  and 
hydrogen gas engines. 

Second,  a  more  efficient  organisation  of  the  entire  mobility  system  based  on  digitalisation, 
data  sharing  and  interoperable  standards  is  of  utmost  importance  to  make  mobility  cleaner. 
This will allow smart traffic management and increasingly automated mobility in all modes, 
reducing  congestion  and  increasing  occupancy  rates.    Regional  infrastructure  and  spatial 
planning should be improved to realise the full benefits of increased use of public transport.  

Urban  areas  and  smart  cities  will  be  the  first  centres  of  innovation  in  mobility  not  least 
because of the predominance of short-distance journeys and air quality considerations. With 
75% of our population living in urban areas, city planning, safe cycling and walking paths, 
clean local public transport, the introduction of new delivery technologies such as drones, and 
mobility  as  a  service,  including  the  advent  of  car  and  bike  sharing  services,  will  alter 
mobility.  Combined  with  the  transition  to  carbon-free  transport  technologies,  reducing  air 
pollution, noise and accidents, this will result in large improvements in the quality of urban 
living.  

Behavioural  changes  by  individuals  and  companies  must  underpin  this  evolution.  For  long 
distance travel, developments in digital technologies and video conferencing may well mean 
that for certain purposes like business travel, preferences will change and demand for travel 
may be reduced compared to what is expected today. Well-informed travellers and shippers 
will make better  decision,  especially  when  all transport modes  are  put on an  equal footing, 
including  in  regulatory  and  fiscal  terms.  Internalising  the  external  costs  of  transport  is  a 
prerequisite for making the most efficient choices in terms of technology and transport mode. 

The  transition  towards  net-zero  in  2050  also  requires  the  necessary  infrastructure,  i.e.  the 
completion  of  the  Trans-European  core  network  (TEN-T)  by  2030  and  the  comprehensive 
network  by  2050.  Future  investments  need  to  focus  on  the  least  polluting  modes,  promote 
synergies  between  transport,  digital  and  electricity  networks  to  enable  innovations  such  as 
vehicle-to-grid  services,  and  include  smart  features  such  as  the  European  Railway  Traffic 
Management  System  (ERTM)  upfront.  That  would  enable  for  instance  high-speed  train 
connections to become a real alternative to aviation for short and medium distance passenger 
travel within the EU. 

Europe  should  remain  the  champion  of  multilateralism.  Given  the  intrinsically  global 
character  of  the  shipping  and  aviation  sectors,  the  EU  needs  to  work  with  global  partners  to 

11 

 
 
encourage  further  efforts  and  build  on  the  progress  that  has  been  recently  achieved  in  the 
International Maritime Organisation (IMO) and the International Civil Aviation Organisation 
(ICAO) with a view to have them secured, as an essential first step towards the decarbonisation 
of these sectors. Further efforts will however be necessary.  

4.  A  competitive  EU  industry  and  the  circular  economy  as  a  key  enabler  to  reduce 
greenhouse gas emissions  

The EU industry is  already today  one  of the most efficient  globally and this is expected to 
continue. A competitive resource-efficient and circular economy will need to develop to keep 
it so. The production of many industrial  goods like  glass, steel and  plastics will see further 
significant  reductions  in  energy  needs  and  process  emissions,  particularly  with  increasing 
recycling  rates.  Raw  materials are indispensable  enablers  for  carbon-neutral  solutions in all 
sectors  of  the  economy.  Given  the  scale  of  fast  growing  material  demand,  primary  raw 
materials  will  continue  to  provide  a  large  part  of  the  demand.  But  a  reduction  of  materials 
input 
improve  competitiveness,  create  business 
opportunities and jobs, and require less energy, in turn reducing pollution and greenhouse gas 
emissions. Recovery and recycling of raw materials will be of particular importance in those 
sectors and technologies where new dependencies might emerge, such as a reliance on critical 
materials  like  cobalt,  rare  earths  or  graphite,  whose  production  is  concentrated  in  a  few 
countries  outside  Europe.  But  also  strengthened  EU  trade  policy  has  a  role  to  ensure 
sustainable and secure supply of these materials to the EU.  

through  re-use  and  recycling  will 

New materials will play an important role as well, whether rediscovering traditional uses such 
as wood in construction, or new composites replacing energy intensive materials. Consumer 
choices  will  also  matter  for  product  demand.  Some  may  come  from  other  ongoing 
transformations,  such  as  digitalisation reducing  paper demand. Others will be  more climate 
conscious  choices,  such  as  customers  increasingly  asking  for  climate  and  environmentally 
friendly  products  and  services.  This  requires  more  transparent  information  to  consumers 
about  carbon  and  environmental  footprints  of  products  and  services  so  that  they  can  make 
informed choices.  

Becoming greenhouse gas emissions free will often mean significantly modernising existing 
installations  or  completely  replacing  them.  This  investment  will  constitute  part  of  the  next 
industrial revolution. The modern, competitive and prosperous EU industry, by staying at the 
forefront of the transition, would be able to strengthen its presence in a global economy that 
will  inevitably  become  increasingly  carbon  constrained.  Digitalisation  and  automation  are 
seen  in  the  short  term  as  some  of  the  more  promising  and  effective  avenues  to  increase 
competitiveness,  leading  both  to  efficiency  gains  and  to  greenhouse  gas  reductions.  A 
combination  of  electrification,  the  increased  use  of  hydrogen,  biomass  and  renewable 
synthetic gas can reduce energy related emissions in the production of industrial goods, just 
as in any other end-use sector.  

Many industrial process-related emissions will be very difficult to eliminate. Some options to 
mitigate them nonetheless exist. CO2 can be captured and stored and used. Instead of fossil 
fuels, both renewable hydrogen and sustainable biomass can be a feedstock for a number of 
industrial processes, such as steel production and certain chemicals. 

Carbon  Capture  and  Utilisation  in  industry  refers  to  processes  where  CO2  is  captured  and 
then converted into a new product. E-fuels can be an example where the CO2 gets released 
again when the fuel is combusted, displacing emissions of fossil fuels. Other CCU products 
such as plastic and building materials exist, which contain the CO2 for long periods of time.  

12 

 
 
Steel,  cement  and  chemicals  dominate  industrial  emissions.  In  the  next  10  to  15  years, 
technologies that are already known will need to demonstrate that they can work at scale, and 
some  of  them  are  indeed  already  being  tested  at  small  scale,  e.g.  hydrogen-based  primary 
steel production. 

Research,  development  and  demonstration  will  significantly  reduce  costs  of  breakthrough 
technologies. This will lead to genuinely new products replacing today's industrial products, 
such as carbon fibre or stronger cements reducing the volume of production while increasing 
product value. A net-zero greenhouse gas emissions economy will see new business concepts 
develop with re-use and additional services at its core.  

5. Develop an adequate smart network infrastructure and inter-connections 

A net-zero  greenhouse  gas emissions economy will be  achieved  only  with an  adequate and 
smart infrastructure ensuring optimal interconnection and sectoral integration across Europe. 
Increased  cross-border  and  regional  cooperation  will  allow  reaping  the  full  benefits  of  the 
modernisation and transformation of Europe’s economy. There needs to be further focus on 
the  timely  completion  of  the  Trans-European  Transport  and  Energy  Networks.  As  a 
minimum,  there  should  be  sufficient  infrastructure  to  support  the  major  developments 
framing  the  energy  transmission  and  distribution  landscape  of  tomorrow:  smart  electricity 
and  data/information  grids,  and  where  needed,  hydrogen  pipelines,  supported  by 
digitalisation and further sector integration, starting with the modernisation of Europe’s main 
industrial clusters in the coming  years. This will in turn spur further clustering of industrial 
installations. 

Transitions  in  the  transport  sector  will  require  accelerated  deployment  of  relevant 
infrastructure, increased synergy between transport and energy systems with smart charging 
or refuelling stations that enable seamless, cross-border services.  

For  existing  infrastructure  and  assets,  retrofitting  can  ensure  their  continuous  use,  fully  or 
partly.  At  the  same  time,  opportunities  are  rising  from  the  timely  replacement  of  ageing 
infrastructure  and  assets  with  carefully  designed  ones,  which  are  compatible  with  the  deep 
decarbonisation objective.  

6. Reap the full benefits of bio-economy and create essential carbon sinks 

In  a  world  with  a  30%  higher  population  in  2050  compared  to  today,  and  with  a  changing 
climate  affecting  ecosystems  and  global  land  use,  EU  agriculture  and  forestry  will  have  to 
provide sufficient food, feed, and fibres as well as support the energy and various industrial 
and construction sectors. All are crucial for Europe’s economy and way of life.  

Sustainable  biomass  has  an  important  role  to  play  in  a  net-zero  greenhouse  gas  emissions 
economy.  Biomass  can  directly  supply  heat.  It  can  be  transformed  into  biofuels  and  biogas 
and when cleaned can be transported through the gas grid substituting natural gas. When used 
in power generation, CO2 emitted can be captured creating negative emissions when stored. 
And  it  can  substitute  for  carbon  intensive  materials,  particularly  in  the  building  sector  but 
also  through  new  and  sustainable  bio-based  products  such  as  biochemicals  (e.g.  textiles, 
bioplastic and composites) 

A  net-zero  emissions  economy  will  require  increasing  amounts  of  biomass  compared  to 
today’s  consumption.  This  is  confirmed  by  both  global  and  European  assessments  of  low 
carbon economy pathways. This assessment confirms this but depending on technologies and 
actions  chosen,  significant  differences  exist,  with  highest  projections  seeing  an  increase  in 
bio-energy consumption by around 80% by 2050 compared to today. 

13 

 
 
Even with improved sustainable management practices, existing EU forests alone could not 
deliver  that  amount  without  a  substantial  decline  of  the  EU’s  forest  sink  and  its  other 
ecosystem-services, which needs to be avoided. Increasing biomass imports could also raise 
concerns  indirectly  related  to  emissions  from  land  use  change  in  exporting  countries. 
Increased  biomass  production  thus  will  need  to  come  from  a  combination  of  sources  while 
ensuring our natural sink is maintained or even enhanced. 

Agricultural production will always result in non-CO2 greenhouse gas emissions but they can 
be reduced by 2050 thanks to efficient and sustainable production methods. Innovation will 
play  an  increasingly  important  role.  Digitalisation  and  smart  technologies  are  the  basis  for 
precision farming and precision agriculture optimising fertiliser and plant protection products 
application.  Significant  differences  still  exist  in  the  productivity  of  cattle  herds  in  the  EU, 
offering  scope  for  continued  improvements.  Treatment  of  manure  in  anaerobic  digesters 
would reduce non-CO2 emissions and produce biogas. There is also a considerable potential 
in agriculture land to sequester and store carbon. 

Farmers  are  increasingly  seen  as  providers  of  resources  and  providers  of  essential  raw 
materials.  There  are  new  business  opportunities  through  the  circular  bio-economy.  Better 
farming  systems  including  agroforestry  techniques  that  efficiently  use  nutrient  resources 
exist,  enhancing  not  only  soil  carbon  but  also  biodiversity  and  improving  resilience  of 
farming to climate change itself. These measures typically increase productivity, reduce input 
needs,  and  other  environmental  pressures  such  as  eutrophication  and  air  pollution.  Carbon 
stocks in agricultural soils can be increased through zero-tillage and the use of cover crops, 
reducing soil disturbances and soil erosion. Adapting certain agriculture activities on organic 
soils  and  restoring  peatlands  and  wetlands,  still  hotspots  of  carbon  soil  emissions,  can 
drastically reduce emissions.  

Afforestation  and  restoration  of  degraded  forest  lands  and  other  ecosystems  can  further 
increase absorption of CO2 while also benefiting biodiversity, soils and water resources and 
increase biomass  availability over time. Farmers and foresters  are the key  stakeholders that 
can achieve such results and should be encouraged and supported to do so.  

Carbon sinks are as important as reducing emissions. Maintaining and further increasing the 
natural  sink  of  forests,  soils,  and  agricultural  lands  and  coastal  wetlands  is  crucial  for  the 
success of the Strategy, as it allows the offsetting of residual emissions from sectors where 
decarbonisation  is  the  most  challenging,  including  agriculture  itself.  In  this  context  nature 
based  solutions  and  ecosystem-based  approaches  often  provide  multiple  benefits  regarding 
water management, biodiversity and enhanced climate resilience. 

New demand for woody biomass could further diversify today’s farming business up to 10% 
of EU agriculture land. This will offer new opportunities for bringing abandoned land back 
into cultivation, as well as for converting land currently used for food-based bio-fuels. This 
will improve farm productivity and income, and most likely increase the value of arable land 
accordingly.  

However, a biomass-based transition is limited by the availability of land. Depending on the 
biogenic  material  from  which  the  biomass  is  produced,  the  impacts  on  land  use,  the  EU 
natural  sink,  biodiversity  and  water  resources  can  differ  substantially.  The  transition  of  our 
economy will always have to be careful how to make best use of scarce land and other natural 
resources and ensure that biomass is only used in the most efficient and sustainable way.  

In  order  to  alleviate  the  multiple  demands  on  the  EU's  land  resources,  improving  the 
productivity of aquatic and  marine  resources  will play  an  eminent  role in capturing the full 
range  of  opportunities  of  the  bio-economy  for  tackling  climate  change.  This  includes  for 

14 

 
 
instance  the  production  and  use  of  algae,  and  other  new  sources  of  protein  which  have  the 
potential to relieve the pressure on agricultural land.  

7. Tackle remaining CO2 emissions with carbon capture and storage  

Carbon  Capture  and  Storage  (CCS)  was  previously  seen  as  a  major  decarbonisation  option 
for  the  power  sector  and  energy  intensive  industries.  Today  this  potential  appears  lower, 
considering the rapid deployment of renewable energy technologies, other options to reduce 
emissions  in  industrial  sectors  and  issues  concerning  social  acceptance  of  the  technology 
itself. However, CCS deployment is still necessary, especially in energy intensive industries 
and – in the transitional phase - for the production of carbon-free hydrogen. CCS will also be 
required if CO2 emissions from biomass-based energy and industrial plants are to be captured 
and stored to create negative emissions. Together with the land use sink, it could compensate 
for remaining greenhouse gas emissions in our economy.  

Considering the lock-in of fossil fuel technologies, e.g. a plant that is built today will likely 
still be operational in 2050, the ability to roll out carbon removal technologies increases the 
credibility  of  the  EU's  long-term  strategy.  CCS  has  not  yet  reached  the  commercialisation 
stage,  hampered  by  lack  of  demonstration  of  the  technology  and  economic  viability, 
regulatory  barriers  in  some  Member  States  and  limited  public  acceptance.  If  CCS  is  to 
materialise  at  scale  within  the  coming  decade  a  much  larger  research,  innovation  and 
demonstration  effort  will  also  be  needed  to  ensure  its  deployment  in  conjunction  with  the 
options  mentioned  above,  i.e.  the  energy  intensive  industry,  biomass  and  carbon-neutral 
synthetic  fuel  plants.  In  addition,  CCS  requires  new  infrastructure,  including  related  to 
transport and storage networks. For CCS to deliver on its potential, a coordinated and forceful 
action is necessary to secure the building of demonstrators and commercial facilities within 
the EU as well as addressing concerns of public opinion in some Member States.  

Pursuing  all  these  strategic  priorities  will  contribute  to  making  our  vision  a  reality. 
Nevertheless,  the  management  of  the  transition  will  require  a  scaled-up  policy  effort.  An 
enabling  framework  is  needed  to  spur  research  and  innovation,  to  scale  up  private 
investments, provide the right signals to the markets, and ensure social cohesion so that that 
no region and no citizens are left behind. 

4.  INVESTING  INTO  A  SUSTAINABLE  SOCIETY  –  A  EUROPEAN  ENABLING  FRAMEWORK  FOR 
THE LONG TERM TRANSITION 

The  development  of  the  options  and  actions  explored  will  to  a  large  extent  depend  on  the 
speed of their initial deployment, the extent to which citizens become active participants in 
the transition, the public acceptance of certain low and carbon free technologies and how fast 
sufficient scale can be reached. This justifies putting in place a number of adequate policies 
and an enabling framework that is conducive to stimulating this change. Building on the work 
done  putting  in  place  the  Energy  Union,  this  framework  should  take  into  consideration  all 
major trends that define the future of the EU economy and society such as climate change and 
environment, digitalisation, ageing and resource efficiency.  

15 

 
 
Figure 3. Enabling framework. Source: EPSC 

Investment and finance 

Modernising  and  decarbonising  the  EU's  economy  will  stimulate  significant  additional 
investment.  Today  around  2%  of  GDP  is  invested  in  our  energy  system  and  related 
infrastructure6. This would have to increase to 2.8% (or around € 520-575 billion annually) in 
order  to  achieve  a  net-zero  greenhouse  gas  economy.  This  means  considerable  additional 
investments compared to the baseline, in the range of € 175 to 290 billion a year7. This is also 
in-line with the IPCC special report that estimated that between 2016 and 2035 investments 
are  needed  in  the  energy  system  representing  about  2.5%  of  world  GDP.  However,  certain 
options  such  as  a  rapid  transformation  towards  circular  economy  and  behavioural  changes 
have the potential to reduce the need for additional investment. 

At the same time, significant health costs can be saved. Today, air pollution in the EU causes 
severe  diseases  and  almost  half  a  million  pre-mature  deaths  annually  with  fossil  fuels, 
industrial  processes,  agriculture  and  waste  being  the  main  sources  of  pollution.  These 
activities are also the main sources of greenhouse gases. Achieving a net-zero greenhouse gas 
emissions economy  on top of existing air pollution measures will  reduce pre-mature deaths 
caused  by  fine  particulate  matter  by  more  than  40%  and  health  damage  by  around  €  200 
billion per annum.   

6 Excluding investments needed to replace vehicles. 
7 Including investments needed to replace vehicles. 

16 

 
 
 
                                                           
Figure 4. Investment requirements 

Private  business  and  households  will  be  responsible  for  the  vast  majority  of  these 
investments.  To  foster  such  investment,  it  is  crucial  for  the  European  Union  and  Member 
States  to  offer  clear,  long-term  signals  to  guide  investors,  to  avoid  stranded  assets,  to  raise 
sustainable finance and to direct it to clean innovation efforts most productively. Providing a 
vision  will  entrench  the  direction  of  where  financial  and  capital  flows  need  to  go.  In  this 
perspective,  transparent  stakeholder  engagement  in  planning  for  a  low-carbon  future  is 
indispensable. The new Governance of the Energy Union integrates this need by foreseeing 
the involvement of stakeholders in the preparation of the national energy and climate plans, 
which  need  to  be  consistent  with  long-term  strategies  as  well  as  the  estimate  of  the 
investment needs.  

Environment,  resource  and  energy  efficiency  are  already  very  prominent  sectors  of  the 
Investment  Plan  for  Europe  –  the  Juncker  Plan  –  a  pillar  of  which  has  been  the  European 
Fund  for  Strategic  Investment  (EFSI)  and  the  EU  cohesion  policy  funds  through  which  the 
EU provides ca. € 70 billion for the implementation of the Energy Union Strategy. EFSI 2.0 
focuses even more on sustainable investments in all sectors to contribute to meeting the Paris 
Agreement’s objectives and to help to deliver on the transition to a resource efficient, circular 
and  low-carbon  economy.  At  least  40%  of  EFSI  projects  under  the  infrastructure  and 
innovation window should contribute to the EU's commitments on climate action in line with 
the  Paris  Agreement’s  objectives  and  InvestEU  will  reinforce  that  focus.  New  financial 
instruments,  addressing  both 
(such  as  energy 
large  and  small-scale 
communities), will also help the energy transition.   

investments 

The European Commission proposal to step up climate mainstreaming to at least 25% in the 
next Multiannual Financial Framework demonstrates the EU budget would continue to act as 
a catalyst to leverage sustainable private and public investment and channel EU support for 
the  clean  energy  transition  to  where  it  is  most  needed.  It  is  also  a  key  part  of  the  EU’s 

17 

050100150200250300Net GHG reduction in 2050 (compared to 1990)Additional annual investment needs compared to baseline (EUR billion 2013)Well below 2°CIntermediate ambition1.5°C-85% (-80% excl. sinks)-90% -100%Well below 2°CIntermediate ambition1.5°C-85% (-80% excl. sinks)-90% -100% 
 
 
credibility in advocating for net-zero greenhouse gas emissions in 2050. Swift progress in the 
MFF negotiations would further stabilise this ambition level. 

The  financial  sector  has  a  key  role  to  play  in  supporting  the  transition  towards  net-zero 
emissions  as  it  can  reorient  capital  flows  and  investments  towards  the  necessary  solutions 
while  improving  efficiency  of  production  processes  and  reducing  the  cost  of  financing. 
Reorienting  private  capital  to  more  sustainable  investments  requires  a  well-functioning 
Capital  Markets  Union.  In  particular  the  Action  Plan  on  Sustainable  Finance  will  help 
connect  finance  with  the  EU's  agenda  for  sustainable  development,  while  the  European 
Commission's  proposal  for  a  unified  classification  system  (taxonomy)  on  sustainable 
economic  activities,  proposed  rules  for  low-carbon  benchmarks  and  improved  disclosure 
requirements  for  investment  products  will  enhance  transparency  and  help  investors  with 
targeting the right investments. Transparency will help prevent the risks that assets which are 
energy  intensive  and/or  dependent  on  fossil  fuels  are  depreciated  before  the  end  of  their 
economic  life.  Apart  from  the  financial  sector  itself,  also  the  supervisory  authorities  and 
central  banks,  including  the  European  Central  Bank,  can  play  an  active  role  in  this  re-
orientation.    Innovative  solutions  to  mobilise  investment  supported  by  patient  capital  and 
venture capital in a long-term perspective will need to be developed. 

Environmental taxation, carbon pricing systems and revised subsidy structures should play an 
important  role  in  steering  this  transition.  Taxation  is  amongst  the  most  efficient  tools  for 
environmental policy. Therefore, taxes and carbon pricing should be employed to account for 
negative  environmental  impacts  and  focus  on  increasing  energy  efficiency,  reducing 
greenhouse  gas  emissions  and  enhancing  the  circular  economy.  It  is  important  that 
environmental  taxation  remains  socially  fair.  A  common  approach  between  the EU  and  the 
Member  States  would  be  crucial  to  avoid  relocation  risks  and  loss  of  competitiveness.  The 
implementation of the Strategy will require sustainable public finances and alternative ways 
of financing public infrastructures. For this, new sources of funding will have to be explored, 
for  example  charges  resulting  from  a  consistent  application  of  the  'polluter-pays'  principles 
and the phasing out of existing fossil fuel subsidies in line with the EU's G20 commitments. 
Reforms  that  support  an  efficient  allocation  of  resources  towards  low-carbon  high-
productivity  activities,  such  as  facilitating  the  entry  for  new  businesses  and  fostering 
competition 
that  strengthens 
competitiveness and economic growth.  

in  product  markets,  will  allow  for  a 

transformation 

Research, innovation and deployment 

Today, the costs of some of the advanced low-carbon energy carriers and technologies remain 
high, and their availability is limited. A massive research, coordinated and innovation effort, 
built around a coherent strategic research and innovation and investment agenda is needed in 
the  EU  within  the  next  two  decades  to  make  low  and  zero-carbon  solutions  economically 
viable  and  bring  about  new  solutions  not  yet  mature  or  even  known  to  the  market.  In  this 
context, a forward-looking research and innovation strategy should be guided by zero-carbon 
solutions that have the potential to be deployed by 2050. Climate is at the heart of Horizon 
Europe,  the  European  Commission’s  proposal  for  the  new  EU's  research  and  innovation 
programme.  The  European  Commission  proposes  to  invest  35%  of  the  near  €  100  billion 
budget in climate objectives, through the development of innovative and cost-effective zero-
carbon  solutions.  The  approach  to  supporting  projects  and  innovations  needs  to  allow  for 
financing high-risk disruptive innovation. The EU is putting in place such new instruments. 
One of these instruments is the European Innovation Council, which will focus on radically 
new,  breakthrough  products,  services  and  processes.  The  European  Institute  of  Innovation 
and Technology will also continue to support young innovators and start-ups across Europe. 

18 

 
 
On  top  of  this,  the  Innovation  Fund  under  EU  Emission  Trading  System  will  support 
commercial-scale demonstration of breakthrough technologies. To help business innovate and 
connect  with  research  organisations,  the  cohesion  policy  will  continue  to  provide  support 
following  the  smart  specialisation  approach.  These  are  opportunities  for  a  solid  set  of 
research,  innovation  and  deployment  activities  over  the  next  decade.  The  European 
Commission  will  explore  how  the  assets  of  the  European  Coal  and  Steel  Community  in 
liquidation could support breakthrough technologies for low-carbon steelmaking. 

EU  research  should  focus  on  transformational  carbon-neutral  solutions  in  areas  such  as 
electrification  (renewables,  smart  networks  and  batteries),  hydrogen  and  fuel  cells,  energy 
storage,  carbon-neutral  transformation  of  energy  intensive  industries,  the  circular  economy, 
the bio-economy and sustainable intensification of agriculture and forestry. Costs will come 
down with increased deployment but at a time of rising global trade distortions a pro-active 
European  industrial  innovation  and  modernisation  strategy  needs  to  define  how  initial 
deployment  can  be  further  supported.  To  this  end,  fully  exploiting  the  Single  Market  and 
respecting international obligations, e.g. through clean public procurement and targeted time-
bound state aid will be key. Drawing on initiatives such as the European Battery Alliance, the 
EU should build  strong  value chains,  supported  through enabling technologies such  as new 
intelligence,  high  performance  computing,  and 
materials,  digitalisation,  artificial 
biotechnology.  

Economic and social impacts 

Even without the net-zero greenhouse gas emissions transformation, Europe’s economy and 
society  will  look  significantly  different  in  2050  from  the  way  it  does  today.  Demographics 
indicate  that  our  society  will  be  ageing  significantly,  with  potential  implications  on  the 
sustainability of  public finances. On the other  hand, our  population will be  generally better 
equipped  for  working  with  information  and  communication  technologies.  Such  trends  will 
facilitate the transition.  

Overall  economic  impacts  of  the  deep  transformation  are  positive  despite  the  significant 
additional investments required in all sectors of our economy. The EU economy is expected 
to  more  than  double  by  2050  compared  to  1990  even  as  it  fully  decarbonises.  A  trajectory 
compatible  with  net-zero  greenhouse  gas  emissions,  together  with  a  coherent  enabling 
framework,  is  expected  to  have  a  moderate  to  positive  impact  on  GDP  with  estimated 
benefits  of  up  to  2%  of  GDP  by  2050  compared  to  the  baseline.  Very  importantly,  these 
estimates  do  not  include  the  benefits  of  avoided  damage  of  climate  change  and  related 
adaptation costs. 

The transition will spur growth in new sectors. 'Green jobs' already represent 4 million jobs in 
the EU. Further investment into the industrial modernisation, the energy transformation, the 
circular  economy,  clean  mobility,  green  and  blue  infrastructure  and  the  bio-economy  will 
create new, local, high quality employment opportunities. Actions and policies to implement 
the  EU's  2020  climate  and  energy  targets  already  added  between  1%  and  1.5%  to  the  EU 
labour force and this trend will continue.  

Whereas  the  number  of  jobs  increases  in  construction,  farming  and  forestry  and  renewable 
energy  sectors,  for  a  number  of  sectors  the  transition  can  be  difficult.  Particularly  affected 
could be the regions whose economies depend on activities that either are expected to decline 
or will have to transform in the future. Areas such as coal mining, oil and gas exploration are 
likely to be affected. Energy intensive sectors such as steel, cement and chemicals as well as 
car  manufacturers  will  see  a  shift  to  new  production  processes  with  new  skills  required. 

19 

 
 
Regions which depend economically on these sectors will be challenged, of which many are 
located in Central and Easter Europe, often in lower income Member States.  

Other existing jobs will have to be transformed and adapted to the new economy. Managing 
this change requires taking into account a possibly shrinking and ageing labour force in the 
EU and increasing substitution of labour due to technological changes including digitalisation 
and  automation.  Rural  areas  for  instance  will  need  to  maintain  a  sufficiently  skilled 
workforce  to  meet  growing  and  changing  demands  in  the  agriculture  and  forestry  sectors, 
while being confronted with a decreasing rural population. For small and medium enterprises, 
the  transition  is  an  opportunity,  but  also  creates  specific  challenges  such  as  access  to  skills 
and finance that need to be addressed. 

Figure 5. Regional employment in fossil fuel extraction and energy intensive industries (NUTS2 level) 

These  challenges  have  the  potential  to  increase  social  and  regional  disparities  in  the  EU  as 
well  as  hamper  the  decarbonisation  efforts.  Therefore,  the  ensuing  deep  modernisation 
process will have to be managed well, ensuring a fair and socially acceptable transition for all 
in the spirit of inclusiveness and solidarity. The social consequences of the transition cannot 
be addressed post factum. Both the EU and the Member States must take into account social 
implications  from  the  outset  and  deploy  all  relevant  policies  to  the  fullest  to  mitigate  this 
challenge. The EU budget, employment and social policies as well as cohesion policies can 
reduce  economic,  social  and  territorial  disparities  across  the  Union.  Ongoing  regional 
initiatives  launched  by  the  Juncker  Commission,  such  as  the  platform  and  pilot  projects  on 
coal  and  carbon-intensive  regions  in  transition  mark  a  step  in  this  direction  and  should  be 
reinforced in anticipation of future needs. Moreover, the involvement of social partners in the 
preparation of such transition measures should be ensured. 

Support for the just transition is provided under the European Pillar of Social Rights, with its 
focus on supporting transitions with adequate social protection systems, inclusive education, 
training  and  lifelong  learning.  Skills  development  is  essential.  People  will  not  only  need 
specific  professional  skills  but  also  ‘key  competences’  from  fields  such  as  science, 

20 

Share of employmentfossil fuel  extraction and miningShare of employmentenergy intensive industries andautomotive manufacturing<0.1%0.1-0.5%0.5-1.0%1.0-2.0%>2.0%<0.1%0.1-1.0%1.0-2.5%2.5-5.0%>5.0% 
 
 
 
technology, engineering, mathematics (STEM) skills. Investing in reskilling and upskilling of 
our population is essential so that we do not leave anybody behind.  

Unless adequate regulatory or mitigating measures are in place, the transition bears the risk to 
disproportionally affect people with low income, leading to the emergence of some form of 
energy poverty. This risk has to be addressed. In most Member States, vulnerable customers 
can  benefit  from  regulated  energy  tariffs,  but  these  tariffs  can  distort  market  signals  and 
reduce  the  effectiveness  of  policies  on  energy  efficiency  or  hamper  the  deployment  of 
technologies such as smart meters. These social issues are generally better addressed through 
the  social  policy  and  welfare  systems,  the  financing  of  which  could  benefit  from  tax  shifts 
and revenue recycling.  

The EU's global role 

The  success  of  EU  efforts  in  leading  a  successful  low-carbon  transition  at  global  level  and 
fighting climate change ultimately depends on international cooperation. This is the driving 
force for the Paris Agreement, which heralds a shift from action by the few to action by all. 
The EU's long-term strategy cannot be pursued in isolation. The EU must therefore promote 
worldwide  uptake  of  policies  and  actions  to  reverse  the  currently  unsustainable  emissions 
trajectory,  and  to  manage  an  orderly  transition  to  a  worldwide  low  carbon  future.  The  EU 
should  continue  leading  by  example  as  well  as  foster  multilateral  rule-based  cooperation. 
This  remains  the  best  means  for  the  EU  to  address  this  inherently  global  challenge, 
underlining the importance to implement the Paris Agreement and making it a global success.  

This means anticipating and preparing for the geopolitical and geo-economic shifts inherent 
in the low carbon transition, such as new and changed dependencies that will derive from the 
move away from fossil fuels, altering current economic relations, as well as the management 
of climate-security  risks, which  will multiply even under the most  optimistic  predictions of 
temperature increase.  

At the same  time, the EU must  take all necessary  measures to safeguard and boost its own 
prospects for economic and social development as well as to address its own vulnerabilities 
emanating from climate change or from harmful unilateral policies by other global players.  

The  EU  will  use  its  external  action,  trade  policy  and  international  cooperation  to  support 
global  transformation  to  low-carbon  sustainable  development  pathways,  in  line  with  the 
European  Consensus  for  Development.  This  will  require  continued  efforts  to  mainstream 
climate  change  and  environment  into  public  policies,  as  well  as  a  reliable  investment 
framework in EU partner countries. 

While dependent on energy imports, the EU is the world's biggest exporter of manufactured 
goods  and  services.  In  downstream  sectors  like  chemicals,  machinery  and  transport 
equipment,  the  EU  is  a  leading  global  exporter.  At  the  same  time,  the  EU  is  also  a  major 
importer fully integrated in global value chains.  

As the world's largest single market, the EU's high environmental standards on products have 
effects that go far beyond the borders of the EU. This underlines the role for continued EU 
leadership  on  regulatory  standards,  putting  European  companies  at  the  forefront  of 
developing new technologies and business models.  

Open markets, a globalised world and multilateralism are a precondition for the EU to be able 
to  benefit  from  the  clean  energy  transition  domestically  and  also  globally.  With  the  clean 
energy transition, new types of assets and  resources are becoming strategic, such as critical 
raw  materials  necessary  for  renewable  energy,  electro-mobility,  digital  appliances,  and 
patents.  Proactive  or  corrective  policies  may  be  needed  to  ensure  a  fully  competitive  and 

21 

 
 
level  playing  field  in  line  with  international  obligations.  Just  as  the  EU  remains  open  for 
climate-friendly  investment  and  trade  it  should  also  defend  its  right  to  reciprocal,  fair  and 
transparently  governed  access  to  partner  countries'  markets,  infrastructure  and  critical  raw 
materials.  

This  starts  with  enhancing  the  EU  energy  and  climate  diplomacy,  and  with  further 
mainstreaming climate change objectives and considerations in political dialogues, including 
in  the  area  of  migration,  security  and  development  cooperation.  Based  on  the  European 
Commission’s  Trade  for  All  strategy,  the  EU’s  trade  policy  is  already  contributing  to 
sustainable  development  in  the  EU  and  in  third  countries.  Fair  and  rules-based  trade  can 
contribute  to  the  global  uptake  of  climate-friendly  technologies,  facilitate  the  energy 
transition,  and  help  secure  supplies  of  the  necessary  raw  materials,  including  those  used  in 
low-carbon  technologies.  The  EU  should  also  continue  to  catalyse  non-State  actors,  for 
example through the Global Covenant of Mayors.  

The role of citizens and local authorities 

Making  the  transformation  towards  a  net-zero  greenhouse  gas  economy  happen  is  not  just 
about technologies and jobs. It is about people and their daily lives, about the way Europeans 
work,  transport  themselves  and  live  together.  Moving  towards  a  net-zero  greenhouse  gas 
economy  can  only  be  successful  with  citizens  that  embrace  change,  get  engaged  and 
experience  it  as  beneficial  for  their  lives  and  that  of  their  children.  Local  ownership  of 
investments  is a  good case in point.  Consumers have  a powerful  role to play in driving  the 
transformation forward – advancing towards a net-zero greenhouse gas economy. Currently, 
there  is  an  increasing  willingness  of  consumers  to  engage  in  sustainable  activities.  Each 
person's  choice  in  buying  a  house,  choosing  energy  supplier,  a  new  vehicle  or  domestic 
appliances  and  equipment  impacts  his  or  her  carbon  footprint  for  many  years  to  come. 
Personal  lifestyle  choices  can  make  a  real  difference,  while  improving  quality  of  life. 
Regulatory  measures,  corporate  responsibility  initiatives  and  emerging  societal  trends  can 
support each other, allowing for rapid change as demonstrated for instance by the successful 
EU energy labelling system being replicated in many parts of the world. 

Cities  are  already  the  laboratories  for  transformative  and  sustainable  solutions.  City 
refurbishment  and  better  spatial  planning  including  green  spaces  can  be  major  drivers  to 
renovate houses and attract people to live again close to work, improving living conditions, 
reducing  travel  time  and  associated  stress.  To  protect  Europe's  citizens  from  the  adverse 
effects of the changing climate, planning and building public infrastructure to withstand more 
extreme weather events will be an imperative no regret option. In this respect, the EU should 
capitalise on and expand the role of regions, cities and towns. The EU Covenant of Mayors 
representing  200  million  European  citizens  is  an  example  of  a  collaborative  platform  that 
allows  local  authorities  to  learn  from  one  another.  The  joint  European  Commission  and 
European Investment Bank URBIS initiative is a tangible example of EU assistance for cities 
in  the  development  of  their  investment  strategies.  The  Urban  Agenda  for  the  EU,  which 
reinforces the urban dimension of relevant EU policies can also play a role. 

5. CONCLUSION AND NEXT STEPS 

The EU has already  started the modernisation and transformation towards  a climate neutral 
economy and will continue to lead global efforts to this end. In order to respond to the recent 
IPCC report and contribute to stabilising the climate in this century, the EU should by 2050 
be among the first to achieve net-zero greenhouse gas emissions and lead the way worldwide. 
To do so, the EU needs to step up its efforts.  

22 

 
 
Climate change is a global threat, and Europe alone cannot stop it. Cooperation with partner 
countries will therefore be essential to reinforce greenhouse gas reduction pathways that are 
consistent with the Paris Agreement.   

Nevertheless,  the  EU  has  a  vital  interest  in  working  towards  a  net-zero  greenhouse  gas 
emissions economy by mid-century and demonstrating that net-zero emissions can go hand in 
hand  with  prosperity,  having  other  economies  follow  its  successful  example.  It  should  be 
based  on  the  empowerment  of  all  citizens  and  consumers  in  making  change  possible  and 
proper information to the public. 

This  represents  a  tremendous  opportunity  to  channel  the  response  to  the  challenges  of  the 
21st  century  in  a  strategic  manner,  rather  than  submit  and  adapt  to  the  inevitable  coming 
change. Ensuring a socially fair transition is crucial to ensure a politically feasible transition. 
This  will  be  challenging,  but  nowhere  as  challenging  as  facing  the  economic  and  social 
consequences of failing to act. The purpose of this strategic vision is not to set targets, but to 
create a vision and sense of direction, plan for it, and inspire as well as enable stakeholders, 
researchers,  entrepreneurs  and  citizens  alike  to  develop  new  and  innovative  industries, 
businesses and associated jobs. 

Starting to plan early for such a vision towards a net-zero greenhouse gas emissions Europe 
will  allow  Member  States,  business  and  citizens  to  make  choices,  and  tailor  the  eventual 
pathway  to  national  circumstances,  resource  endowments,  innovation  of  industries  and 
consumer preferences.  

Figure 6. GHG emissions trajectory in a 1.5C scenario8 

There  are  a  number  of  pathways  for  achieving  a  climate  neutral  net-zero  greenhouse  gas 
emissions  in  line  with  our  vision:  all  are  challenging,  but  could  be  feasible  from 
technological,  economic,  environmental  and  social  perspective.  Reaching  this  objective 
requires  deep  societal  and  economic  transformations  within  a  generation  touching  every 
sector of the economy. Applying the principles of a competitive, inclusive, socially fair and 
multilateral  European  approach,  a  number  of  overriding  priorities,  fully  consistent  with  the 
Sustainable  Development  Goals,  should  be  guiding  for  the  transition  to  a  climate  neutral 
Europe: 

8 Bars represent the emissions and absorptions in 2050 of the 7th and 8th scenario. 

23 

MtCO2eqMtCO2eqNon-CO2 otherNon-CO2 AgricultureResidentialTertiaryTransportIndustryPowerCarbon Removal TechnologiesLULUCFNet emissionsDifferent zero GHG pathways lead to different levels of remaining emissions and absorption of GHG emissions 
 
 
                                                           
◦  Accelerate the clean energy transition, ramping up renewable energy production, 
high energy-efficiency  and improved security of supply, with increased focus on 
reducing  cyber  security  threats,  while  ensuring  competitive  energy  prices,  all  of 
which power the modernisation of our economy;  

◦  Recognise and strengthen the central role of citizens and consumers in the energy 
transition, foster and support consumer choices reducing climate impact and reap 
collateral societal benefits improving their quality of life; 

◦  Roll  out  carbon-free,  connected  and  automated  road-transport  mobility;  promote 
multi-modality and shifts towards low-carbon modes such as rail and waterborne 
transport;  restructure  transport  charges  and  taxes  to  reflect  infrastructure  and 
external  costs; 
tackle  aviation  and  shipping  emissions  using  advanced 
technologies and fuels; invest in modern mobility infrastructure and recognise the 
role of better urban planning; 

◦  Boost  the  EU's  industrial  competitiveness  through  research  and  innovation 
towards  a  digitalised  and  circular  economy  that  limits  the  rise  of  new  material 
dependencies;  start  testing  at  scale  breakthrough  technologies;  monitor  the 
implications  on  the  EU's  terms  of  trade,  in  particular  for  the  energy  intensive 
industries and suppliers of low carbon solutions, ensure competitive markets that 
attracts low carbon industries,  and  in  line with international obligations  alleviate 
competitive  pressures  that  could  lead  to  carbon  leakage  and  unwanted  industrial 
relocation; 

◦  Promote  a  sustainable  bio-economy,  diversify  agriculture,  animal  farming, 
aquaculture  and  forestry  production,  further  increasing  productivity  while  also 
adapting  to  climate  change  itself,  preserve  and  restore  ecosystems,  and  ensure 
sustainable use and management of natural land and aquatic and marine resources; 

◦  Strengthen  infrastructure  and make it climate  proof. Adapt  through smart digital 
and cyber-secure solutions to the future needs of electricity, gas, heating and other 
grids  allowing  for  sectoral  integration  starting  at  local  level  and  with  the  main 
industrial/energy clusters; 

◦  Accelerate near-term research, innovation and entrepreneurship in a wide portfolio 

of zero-carbon solutions, reinforcing the EU's global leadership; 

◦  Mobilise  and  orient  sustainable  finance  and  investment  and  attract  support  from 
"patient" capital (i.e. long-term venture capital); invest in green infrastructure and 
minimise  stranded  assets  as  well  as  fully  exploit  the  potential  of  the  Single 
Market; 

◦ 

Invest in human capital  in the next decade and beyond, equip current and future 
generations with the best education and training in the necessary skills (including 
on  green  and  digital  technologies)  with  training  systems  that  quickly  react  to 
changing job requirements. 

◦  Align  important  growth-enhancing  and  supporting  policies,  such  as  competition, 
labour market, skills, cohesion policy, taxation and other structural policies, with 
climate action and energy policy. 

24 

 
 
  
◦  Ensure  that  the  transition  is  socially  fair.  Coordinate  policies  at  EU  level  with 
those  of  Member  States,  regional  and  local  governments  allowing  for  a  well-
managed  and  just transition that  leaves no region, no community  and no  worker 
and citizen behind; 

◦  Continue  the  EU's  international  efforts  to  bring  all  other  major  and  emerging 
economies  on  board  and  continue  creating  a  positive  momentum  to  enhance 
global climate ambition; share knowledge and experience in developing long-term 
strategies and implementing efficient policies so that collectively the objectives of 
the  Paris  Agreement  are  accomplished.  Anticipate  and  prepare  for  geopolitical 
shifts,  including  migratory  pressure,  and  strengthen  bilateral  and  multilateral 
partnerships, for instance by providing support to third countries in defining low-
carbon resilient development through climate mainstreaming and investments. 

Member  States  will  submit  to  the  European  Commission,  by  the  end  of  2018,  their  draft 
National  Climate  and  Energy  Plans,  which  are  central  for  the  achievement  of  the  2030 
climate and energy targets and which should be forward-looking and taken into account in the 
EU  long  term  strategy.  In  addition,  an  increasing  number  of  regions,  municipalities  and 
business associations are drawing up their own vision for 2050, which will enrich the debate 
and contribute to defining Europe’s answer to the global challenge of climate change. 

The  European  Commission  invites  the  European  Parliament,  the  European  Council,  the 
Council,  the  Committee  of  the  Regions,  the  Economic  and  Social  Committee  and  the 
European Investment Bank to consider the EU vision for a climate neutral Europe by 2050. In 
order to prepare EU Heads of State or Government for shaping the Future of Europe at the 
Special  Summit  on  9  May  2019  in  Sibiu,  all  relevant  Council  formations  should  hold 
extensive  policy  debates  on  the  contribution  of  their  respective  policy  areas  to  the  overall 
vision. 

In  parallel,  in  the  first  half  of  2019,  the  European  Commission  will  take  the  debate  on  the 
necessary  deep  economic  transformation  and  the  profound  societal  change  in  an  open  and 
inclusive  manner  to  all  EU  Member  States.  National  Parliaments,  business,  non-
governmental organisations, cities and communities, as well as citizens at large and the youth 
should participate in Citizens Dialogues discussing the EU’s fair contribution to the efficient 
achievement of the temperature goals of the Paris Agreement in the long-term, and to identify 
key building blocks to achieve this transformation.  

This  EU-wide  informed  debate  should  allow  the  EU  to  adopt  and  submit  an  ambitious 
strategy by early 2020 to the UNFCCC as requested under the Paris Agreement.  

Internationally, over the coming  year the EU should expand its cooperation closely with its 
international partners, so that all parties to the Paris Agreement develop and submit a long-
term national mid-century strategy by 2020 in the light of the recent IPCC Special Report on 
1.5̊ Celsius.  

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