Energy, transport, heating and industrial transition: a major modelling study now provides EU-wide guidance with high sector detail on the required pace of transition to fossil-free technologies. The conclusion is encouraging: the EU Green Deal is realistic, and it will ultimately make the continent stronger and more independent from oil and gas crises. The study was conducted at the Potsdam Institute for Climate Impact Research (PIK) and published in Nature Communications.
To understand the scope for useful policy measures, the research team focuses on how the EU can achieve its 2050 climate neutrality target at minimal cost. It draws on the accurate energy–economy–climate model REMIND, runs through a reference scenario – based on assumptions deemed to be most plausible – and then varies key assumptions: Where does the EU stand in terms of emissions reduction and energy efficiency in 2030? How will the costs of wind and solar power develop by 2050? How available will hydrogen and synthetic fuels be as fossil-free sources of energy? Additionally, how much capacity can the EU create for removing CO₂ from the atmosphere to offset hard-to-avoid residual emissions?
One finding is that the EU climate transition, at minimal cost and under the most plausible scenario assumptions, would require a reduction of 2040 net greenhouse gas emissions by 86 percent, relative to 1990. "This result is grounded in techno-economic optimisation of the EU's transformation path, without looking at questions of fair global burden-sharing," says PIK researcher and study co-author Robert Pietzcker.
The EU climate advisory board had recommended a 90 to 95 percent reduction based on considerations of both what is possible and what is fair globally. In doing so, the board had been drawing, among other things, on preliminary results from scenarios developed for the current study. The recommendation was taken up by the EU Commission's proposal for a 90 percent reduction target. In order to slightly reduce the pressure on member states, it was allowed that 5 percent reductions can come from projects outside the EU. "Our results now show that the resulting 85 percent EU-internal reductions are in line with a cost-effective transition to climate neutrality," explains Pietzcker.
Electricity generation from wind and solar must increase seven-fold
To achieve such a significant emissions reduction within just 14 years, the EU must double down on its achievements until now – having reduced greenhouse gas emissions by 37 percent in 2024, relative to 1990 – and further accelerate the transition. To guide future measures, the research team provides "milestones" for individual sectors by 2040 based on its model analysis. These are shown as a point value (representing the reference scenario under the most plausible assumptions) and as a "sensitivity range" (across the entire set of scenarios with the varied assumptions still deemed to be reasonable).
Two pillars of the transition are the expansion of renewable electricity, and the electrification of energy demands. In the reference pathway to climate neutrality, electricity generation from wind and solar will need to be seven times higher in 2040 than in the period from 2018 to 2022 (sensitivity range: four to eight times higher). The share of electricity in final energy consumption, which was fairly constant at 20 percent in the 2010s, will need to rise to 49 percent by 2040 (range: 45 to 59 percent).
Although a sevenfold rise in wind and solar electricity by 2040 is ambitious, recent experience indicates that it may well be achievable: the required annual growth rate was already achieved over the period 2021–2025, driven by the policy response to the energy crisis. Similarly for electrification: the EU-wide share of battery-electric vehicles in car sales has increased from 2 percent in 2019 to 19 percent in 2025, with Norway and Denmark reaching sales shares above 80 percent.
Dependence on gas and oil imports falls by 60 percent
The study also provides milestones regarding the capture of CO₂ from the atmosphere and storing it permanently in geological formations – a capability that will be indispensable for climate neutrality, but which has so far been virtually non-existent. Carbon capture and storage capacity must rise by 26 (range: 16 to 30) percent annually between 2030 and 2040, reaching 188 (56 to 257) million tonnes of CO₂ annually
"The path to EU climate neutrality by 2050 is still feasible, as long as the EU now shapes the period up to 2040 with ambitious policies," says Renato Rodrigues, PIK researcher and lead author of the study. "Successful decarbonisation can make the EU economically stronger and strategically more independent."
This is because, in the reference scenario of the model analysis, demand for both natural gas and crude oil in 2040 is 60 percent lower than in the period from 2018 to 2022, Rodrigues explains. "Although the EU might still need alternative energy imports – e.g. green hydrogen, ammonia, or e-fuels – the volumes would be much lower than current fossil fuels, reducing the EU's reliance on off-shore energy producers."
