The European Green Deal, Energy Transition and Decarbonization
Simone Borghesi (Department of Political and International Sciences, University of Siena and Robert Schuman Center, European University Institute); Sergio Vergalli (Department of Economics and Management, University of Brescia and Fondazione Eni Enrico Mattei)
Environmental and Resource Economics (2022) | Special Issue
Climate change is becoming an increasingly cogent issue. In November 2019, the European Parliament declared a climate emergency asking the European Commission to ensure that all its proposals are in line with the 1.5 °C target. In response, the Commission announced the European Green Deal, a roadmap for Europe to become a climate-neutral continent by 2050. The crisis resulting from Covid-19 has further underscored the need for urgent environmental measures. The pandemic showed the magnitude of a global catastrophic event and prompted policy makers to consider a long-term strategy to prevent climate change from causing irreparable damage to the socioeconomic system. It has become even more strategic to adopt the European Union’s Net Zero Emissions 2050 policy, which entails drastic decarbonization and could lead the European Union to be the leader in renewable energy production. This responsibility could have strategic significance for the future, allowing Europe to play a relevant role in the global geopolitical chessboard. Energy transition is clearly a “sine qua non” condition to pursue these goals. It is a new kind of transition, which is generated not only by technological innovation but also (or mainly) by the internalization of externalities and the attempt to avoid imminent climate damage. The energy transition must be pursued by all actors in the economic system: consumers, businesses, and institutions. Policy makers must identify the right tools to be able to stimulate the shift of energy resources from fossil fuels to renewables.