Dispatch from the European Union | March '26
*** Our weekly Dispatches provide an overview of the most relevant recent and upcoming developments for the shift to climate neutrality in selected European countries, from policy and diplomacy to society and industry. For a bird's-eye view of the country's climate-friendly transition, read the respective 'Guide to'. ***
Stories to watch in the weeks ahead
- European carbon market (EU ETS): Rising gas and oil prices on European markets following the crisis in the Middle East have further fuelled debate about the future of the European carbon market – the EU Emissions Trading System (EU ETS), in Brussels jargon – just months before the European Commission is due to propose a revision in July covering the 2030–2040 period. The EU body with the power to propose legislation that is led by Ursula von der Leyen plans to extend free carbon allowances for industry beyond 2035 as part of the July review, the president said after an EU summit on 19 March. The move would slow the phase-out of free permits and place the ETS on a more “realistic” emissions reduction path, she said. A 30 billion euro “investment booster”, funded by revenues from the ETS price on carbon emissions, is also envisaged to support lower-income member states.
- Bringing down power prices: The Commission will also put forward a proposal to reduce electricity tax rates, thereby taxing power less than fossil fuels. Germany’s chancellor Friedrich Merz, France’s president Emmanuel Macron and Commission leader von der Leyen cautioned against more far-reaching interventions in the ETS. Instead, “tailor-made, targeted and temporary” measures should primarily assist European countries that are most affected by high energy prices, von der Leyen said. This includes revising the ETS Market Stability Reserve, a mechanism aimed at preventing sharp price spikes by releasing allowances onto the market once a certain price threshold is reached.
- EU set to phase out remaining Russian oil imports: According to the European Commission’s current agenda, Teresa Ribera, the Spanish executive vice-president for a Clean, Just and Competitive Transition, will present the RepowerEU proposal to phase out remaining Russian oil imports. Repower EU is the union’s plan to completely phase out Russian oil, gas and nuclear energy from its energy system by 2027, presented in May last year.
- Boosting European industry decarbonisation: After repeated delays, the Commission on 4 March published its long-awaited Industrial Accelerator Act (IAA), which aims to leverage the European single market and boost demand for “Made in Europe” low-carbon products and net-zero technologies, the Commission’s executive vice-president for Prosperity and Industrial Strategy Stéphane Séjourné said in Brussels. The plan targets energy-intensive industries such as steel, aluminium and cement, as well as the auto sector and clean technologies, including batteries, wind, solar and heat pumps. The proposal now heads to negotiations with the European Parliament and the Council of the EU, which represents the interests of the 27 member states, where heated debates are expected over the scope of the proposed “Made in Europe” concept.
The latest in EU policymaking – last month in recap
- Citizen Energy: The European Commission on 10 March unveiled its Citizen Energy Package, aimed at lowering electricity costs and tackling energy poverty across the EU. Friends of the Earth Europe said the plan lacks binding targets and clear funding, warning that bureaucratic, financial and technical barriers to energy communities persist – concerns that were also raised by the European Court of Auditors.
- EU climate diplomacy: EU climate ministers meeting under the Council of the European Union presidency are stepping up preparations for the next UN climate summit after a difficult round of negotiations last year. An internal document seen by Reuters shows the European Union is rethinking its climate diplomacy after struggling to rally global backing for stronger emissions cuts at COP30. "The EU encountered increasing difficulty in lining up international support for translating its high level of ambition into concrete negotiation outcomes," the document said. The talks were further complicated after Donald Trump withdrew the United States from the process. An EU senior official said the EU now wants to prepare earlier and define clearer priorities for COP31, while safeguarding the multilateral process and stepping up outreach to partners beyond Europe.
Claire’s picks: highlights from upcoming events and top reads
- European Climate Pact: The European Climate Pact will hold its flagship annual event in Brussels and online on 24–25 March, bringing together participants to review progress and step up climate action across Europe. The initiative aims to mobilise citizens, organisations and communities to take practical steps in their own fields and daily lives against climate change. Launched by the European Commission as part of the European Green Deal, the pact supports the European Union’s target of becoming the world’s first climate-neutral continent by 2050. Full programme and registration here.
- Renewable energy investments in Africa: Middle Eastern sovereign wealth funds and state-backed companies are unlikely to scale back renewable energy investments in Africa despite disruptions from the Iran war because of long-term economic and strategic perspectives, press agency AP reports, citing a report released last month by the Clean Air Task Force, a global non-profit organisation working on climate and energy, with a focus on technologies and policies it deems necessary to get to net-zero-emissions. Gulf countries are increasingly turning to Africa’s clean energy sector, attracted by rising electricity demand, rapid urbanisation and the continent’s growing role in global supply chains tied to critical minerals and manufacturing, the report found.
- Greenwashing: Cases of greenwashing rose worldwide between 2021 and 2025, including across the European Union, the United Kingdom and the United States, according to a study published on 6 March by consultancy KPMG. The report “The challenge of greenwashing: an international regulatory overview” examines 28 countries. It defines greenwashing as the practice whereby firms portray their activities, products or services as more environmentally friendly than they actually are.
All texts created by the Clean Energy Wire are available under a “Creative Commons Attribution 4.0 International Licence (CC BY 4.0)”. They can be copied, shared and made publicly accessible by users so long as they give appropriate credit, provide a link to the license, and indicate if changes were made.