Europe’s sovereignty budget

By Ariel Brunner, Regional Director, BirdLife Europe and Central Asia, Chiara Martinelli, Director, Climate Action Network Europe, Ester Asin, Director, WWF EU, Patrick Ten Brink, Secretary General, European Environmental Bureau, and William Todts, Executive Director, Transport & Environment.

Every year, Europe spends around €430 billion on imported fossil fuels. Instead of investing in a resilient, renewables-based and homegrown energy system, we are paying a massive annual premium for our dependency on fossil fuels. The money funds some of the worst regimes on earth; several of which are actively working to undermine Europe’s security and democracy.

The resulting pollution continues to heat the climate year by year with devastating effects. Air pollution from European industry costs society up to €428 billion a year through damage to people’s health and the environment. In 2024, that was equal to 2% of EU GDP, with fossil-fuel power plants the biggest source of harm.

And the costs rise when supplies are disrupted. In the last energy crisis, €651 billion were used to cushion price spikes and bail out of energy companies. Yet, the EU's dependency on fossil energy imports has remained almost unchanged at 57% for the past two decades. We must act differently and invest in systematically phasing out fossil fuels to reduce our exposure to the next fossil energy crisis.

We know what helps: renewable energy, efficiency and electrification through affordable clean-tech such as electric public transport, electric vehicles, heat pumps, solar panels, batteries and smart grids. By embracing clean technologies and ensuring equitable access to them, Europe can become more sovereign and build resilient local value chains and create stable jobs.

Yet, fossil fuel dependency does not disappear overnight. We need a major investment boost in electrification, renewable energy and energy efficiency, as recently called for by more than 70 leading businesses. For too long, Europe’s ambitions have been curbed by a lack of funding.

This is why the next EU long-term budget is so important. The €2 trillion investment budget from 2028 to 2034 needs to support regions, households and businesses in the electrification mission, while providing the right incentives to European innovators to design a new clean industrial world map where value-creation in Europe is fostered.

The urgency of the current fossil fuel crisis shows that forging the next EU budget is about building Europe’s master plan for the next decade. We cannot solve a structural crisis with short-term fixes and with business as usual.

First, we need a strictly fossil-free budget. Not a single Euro of public money should prolong harmful fossil fuel dependency. This requires a robust, uncompromising implementation of the "Do No Significant Harm" principle across every single funding stream. Our budget is too small to waste any of it on harmful and future stranded assets.

Second, we must spend more on climate and the environment. A massive, targeted injection of capital is essential to scale up the rapid electrification of transport, heating and industry, fully supported by a modernised, smart European grid. The environmental and climate spending target is the right lever. However, the proposed 35% is insufficient, especially when greenwashing and exemptions make it a de facto horizontal target of 25%. Europe needs a higher target of 50% for future-proof investments.

Last but not least, investment needs go beyond electrification. Agriculture depends on soil, water, pollinators, and a stable climate. Industry relies heavily on energy and raw materials. Cities depend on natural ecosystems to collect, filter, and regulate water, but also to protect people against extreme heat. Environmental breakdown is a security risk. Beyond the urgent need to break free from fossil fuels and reduce our consumption of raw materials, protecting and restoring nature is paramount. Nature absorbs floods, stabilises harvests, stores carbon, and can even contribute to military defence. Few defence investments deliver that many benefits at once. A robust spending target for climate and the environment, and a standalone LIFE programme with earmarked budgets, are essential.