Harnessing the clean transition will be key to building a more competitive EU

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A new JRC study shows how the clean transition can boost the EU’s competitiveness, resilience and strategic autonomy. It maps priority areas and cross-cutting enablers to turn goals into actions.

Taking a systemic view, the report highlights how science and research can drive innovation that speeds up the clean transition, while strengthening Europe’s competitiveness, resilience and strategic autonomy.

Delivering the clean transition for Europe’s future

The clean transition is not only an environmental necessity, but also a cornerstone of Europe’s sustainable competitiveness: accelerating decarbonisation, innovation and self‑reliance is essential for safeguarding Europe’s economic prosperity and stability, social justice and public‑health outcomes.

A systemic challenge

Truly seizing these opportunities means building climate‑neutral energy systems, an economy with circularity at its core, sustainable mobility, resilient food systems, while preserving and restoring biodiversity. However, the key to making this affordable while strengthening European independence is tackling these challenges together and managing trade‑offs.

Energy, transport and buildings are key areas where targeted investments can deliver major emissions reductions, enhance energy security and strengthen Europe's industrial competitiveness.
Improving labour-intensive practices like repair, upcycling and remanufacturing, developing secondary raw materials markets and investing in waste management, can boost Europe’s circular economy while building competitiveness and resilience.
Transforming food systems can improve environmental performance while strengthening the resilience, competitiveness and long-term viability of European agriculture and rural communities.
Preserving and restoring ecosystems will improve our health and wellbeing, and at the same time reduce physical risks for sectors such as agriculture, forestry, real estate, insurance, energy, water utilities and infrastructure.
Cutting pollution at the source and remediation legacy pollution, delivers cleaner air, water and soil with major health gains.

Investment benefits and the cost of inaction

Investing in nature restoration and climate action can bring substantial economic returns: annual investments of around €5.8 billion in protected areas could generate up to €300 billion per year in benefits. The EU blue economy already supports over 3.5 million jobs and generates more than €170 billion in value-added, with further scope for innovation in marine renewables, biotechnology and robotics.

However, missing climate targets could lead to losses of at least 0.7% of GDP annually by 2050, even without considering the impacts of the multiplication of extreme climate events on agriculture and energy, displacement of people, conflicts and security implications of a changing climate, irreversible damage to nature, or the consequences of passing climate tipping points. In other words, inaction is expensive and carries considerable risk.

Securing clean energy

Dependence on fossil fuels and critical raw materials hamper the EU’s competitiveness and resilience, particularly in times of geopolitical volatility.

Generating more of our electricity from renewables like solar and wind, can lower energy costs and deliver cleaner, more affordable energy. Meanwhile, revenues from environmental policies could fund building renovations, and the shift to low-carbon heating -boosting the economy and public health.

Investing in a modernisation of the EU’s energy system away from imported fossil fuels has created new jobs and business opportunities in Europe, and contributed to improving air quality with positive health benefits for the population.

A stronger, more self-sufficient Europe

There is an increasing demand in Europe for both biological and mineral resources. A sustainable, circular bioeconomy is central to reducing fossil fuel reliance, promoting resource efficiency and boosting rural economies.

The EU wastes a vast amount of critical raw materials that can be recovered from end-of-life products and reused.

A strengthened circular economy will cut reliance on primary resources - particularly imported ones - and make the European economy more resilient to geopolitical instability.

Investing in innovation

Scientific breakthroughs often fail to become market-ready products. Closing this commercialisation gap requires public‑private partnerships, de‑risked finance, streamlined regulation and skills development.

Investing in the clean transition

Mobilising private finance calls for scaling up sustainable debt instruments, improving access to private finance for innovative companies and deploying public finance to de-risk and crowd-in investments.

In the energy sector, an annual average investment of approximately €660 billion is needed (2026–2030) for the EU’s energy transition and delivering secure, clean and affordable energy for all.

Inclusion and fairness for long-term success

A fair and inclusive clean transition that shares the benefits across society is essential. Energy poverty still affected 10.6% of the EU population in 2023, while the wealthiest 10% of the population accounted for nearly half of the EUs climate emissions.

Transparent communication, citizen engagement and place-based approaches can help to bring communities, cities and regions on board to turn EU ambitions into local success.

Stronger multi-level governance and coherent policy across sectors can turn the EU’s competitiveness challenge into an opportunity: making the clean transition the lasting foundation of a more prosperous, sustainable, and resilient Europe.

Background

The clean transition is central to the EU’s 2024–2029 sustainable competitiveness agenda, as set out in President von der Leyen’s Political Guidelines and echoed in her 2025 State of the Union address.

The new JRC report builds on the 2025 flagship report Delivering the EU Green Deal: Progress towards targets.