As Ursula von der Leyen’s second term as European Commission President gets underway, she must turn the bold promises of her first term’s Green Deal into action. The Commission wants Europe to cut emissions, ramp up clean energy and dominate the global green tech market – an agenda as much about securing Europe’s economic and geopolitical future as tackling the climate crisis.
Enter the Clean Industrial Deal, the Green Deal’s successor programme, designed to fast-track investment in climate technologies and bridge the gap between ambition and delivery. But for the transition to succeed, the EU must move on from outdated and rigid regulations that hold back innovation. What’s needed is a flexible, technology-neutral framework that supports immediate wins while keeping long-term goals in sight.
For years, EU climate policies have leaned heavily on broad targets and indirect incentives. While these have nudged industries towards greener practices, they often overlook the fact that transformation happens in steps, not leaps. This is where Mario Draghi’s recent report on European competitiveness comes in. The former Central Bank president’s message is clear: one-size-fits-all policies are a recipe for stagnation. Flexibility is the key to innovation and faster carbon cuts.
Take low-carbon and net-carbon-neutral fuels like methanol. When produced from renewable sources such as waste biomass, biomethane, green hydrogen or captured CO₂, methanol can cut carbon emissions by up to 95 per cent. Even low-carbon methanol, which is more readily available than its green counterpart, delivers significant emissions reductions. But here’s the catch: strict EU lifecycle emissions criteria make it nearly impossible for low-carbon fuels to compete. Investors are discouraged, projects stall and potential progress gets stuck in regulatory limbo.
This is a missed opportunity as well as a bureaucratic headache. Frameworks such as the Renewable Energy Directive and FuelEU Maritime aim to accelerate the green transition, but their rigid thresholds penalise or exclude low-carbon fuels that cut emissions now, discouraging investment. Europe and our climate can’t afford this delay.
Take the sectors most in need: heavy transport, shipping and aviation. These hard-to-abate industries are not able to flick a switch and go fully electric or hydrogen-powered. They need transitional fuels to bridge the gap. Low-carbon fuels are ready to fill that role, but rigid policies are stifling change and innovation.
In line with Draghi’s recommendations, the new Commission must change its playbook. It needs to adjust emissions thresholds, introduce phased targets and expand subsidies for transitional low-carbon fuels. This is not about lowering standards; it is about recognising the realities on the ground and making it easier for industries to move in the right direction.
A smarter, more flexible regulatory framework would accelerate the energy transition. Methanol and other low-carbon fuels can contribute to slashing emissions today while paving the way for fully renewable systems tomorrow. Draghi’s support for adaptability is a call to action. Tailored policies encouraging incremental progress will get Europe closer to its climate goals faster than rigid, all-or-nothing approaches ever could.
The clock is ticking. Europe’s climate ambitions are within reach, but only if the new Commission acts now. This is a moment for bold decisions and pragmatic leadership. By backing transitional solutions and embracing flexibility, the EU can lead a green transition that delivers for the planet, the economy and future generations.