Dispatch from the European Union | October '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'. ***
30 Oct 2026, 08:45
Sam Morgan, Kira Taylor
Stories to watch in the weeks ahead
- European budget – The October European Council summit brought leaders no closer to an agreement on the next long-term budget for 2028-2034, with no movement over the impasse between Northern countries, who demand cuts, and Southern and Eastern countries who want to preserve or expand EU spending. An extraordinary summit has been scheduled for 26 – 27 November to try again to make progress before the regular leaders meeting on 17 December, when European Council president Antonio Costa hopes to secure a deal. The cuts demanded by the Northern “frugals” (Germany, Denmark, Sweden, Finland, Austria and the Netherlands) would slash several of the Commission’s proposed spending envelopes for climate. The Irish presidency of the EU Council was tasked with implementing the demanded cuts, and their new proposal would cut climate funding in regional spending envelopes and scrap the LIFE programme, which supports nature conservation, biodiversity and climate action, as a standalone funding scheme. The Clean Transition and Industrial Decarbonisation envelope in the Competitiveness Fund would be reduced by 3 billion euros. The Commission’s proposal had earmarked around 35 percent of the nearly 2 trillion-euro budget for climate and environmental objectives, including 66.3 billion euros for clean transition and industrial decarbonisation measures. The threatened across-the-board cuts means that euro amount would be less.
- Industrial Accelerator Act – The flagship plan of Commission industry vice president Stephane Sejourné has seen a big pushback from conservative lawmakers from president Ursula von der Leyen’s EPP group in the European Parliament. At issue is the “made in Europe” provision which would steer public procurement and subsidies toward European manufacturers in sectors such as renewable energy, steel and automobiles. Following the EPP revolt, French president Emmanuel Macron has reportedly struck a deal with German chancellor Friedrich Merz: Merz will drop the EPP’s opposition to Made in Europe in exchange for Macron supporting scrapping the 2035 combustion engine ban (see below). But it's still unclear whether the initial positive draft report last month, which kicked up all the fuss, will get an endorsement by the full parliament.
- Methane regulation – Energy ministers in the Council are set to vote on how long to delay the methane regulation on 6 November. Countries led by France want a one-year delay, while countries led by Italy and Poland are pushing for a three-year delay. Amid the push to delay the EU’s methane regulation, Politico reported that the oil and gas sector has plans to push for further deregulation. The International Association of Oil and Gas Producers said the change is “insufficient to fully mitigate risks and would leave the EU facing the same implementation challenges in 12 months’ time.” A new proposal may come next year to extend the delay.
The latest in EU policymaking – last month in recap
- European Council summit – Conservative EU leaders used the occasion of a discussion on soaring energy prices at the 15 October European Council summit in Brussels to launch an attack on the centrepiece of EU climate action, the Emissions Trading System (EU ETS). The leaders of Italy, Poland, Czechia, Estonia and Hungary called for the planned expansion of ETS to transport and heating, the so-called ETS 2, to be delayed or scrapped entirely. The group garnered softer support from at least five other countries, all from the EU’s East, according to a Council source. But the majority of leaders rejected the idea. Ahead of the summit, Sweden, Denmark and Finland wrote a joint letter to the other leaders warning that dismantling the ETS would jeopardise all EU climate policy and undermine the clean investments companies have already made. Businesses sent a similar letter. However Giorgia Meloni was able to extract a commitment from the Commission to reconsider the issue.
- Energy ministers debate ETS – ETS 2 may have been saved in the European Council for now, but the Council and Parliament reached a separate agreement to amend the market stability reserve, a system which acts as a buffer to prevent extreme carbon price crashes or spikes. The changes will be followed by a broader reform of the ETS, that are currently being negotiated. On 29 October, energy ministers met in the Council of the EU to continue discussions over future EU policies. Eurelectric, which represents electricity generators, pleaded with the ministers to ensure a “meaningful, predictable carbon price.” They also asked ministers to support a Commission proposal to tax gas more than electricity. But based on discussions at the Council it appears there is a large group aiming to block the proposal, with around a dozen countries including Germany and Italy calling for it to be scrapped.
- Climate resilience framework – The European Commission presented its Climate Resilience Framework to help member states prevent and prepare for the growing impacts of climate change. Designed as a new integrated strategy, the initiative is will respond to growing concerns that adaptation efforts across Europe remain fragmented and uneven.
- No more combustion engine ban – The European Parliament’s industry and transport committees voted this month to back a compromise with national governments that would reduce the required emissions cut for automotive manufacturers from 100 percent by 2035 to 95 percent. Under the change, manufacturers could also receive up to 7.5 percentage points of additional flexibility for using European low-carbon steel, making the target effectively 86.5 percent. This would leave room for new combustion engine and hybrid vehicles to continue being produced after 2035. The environment committee, which is leading on the file, will vote on 23 November. They are expected to back the cross-party deal. Negotiations will then begin with member state governments, where France and Germany are seeking agreement to their deal to weaken emissions rules, with the final change expected to be adopted early next year.
Dave’s picks: highlights from upcoming events
- Civil protection – This year’s EU Civil Protection Forum on 3-4 November takes on new importance for two reasons. For one, it is civil protection authorities that must increasingly respond to the effects of climate change like the heat wave Europe saw this summer. And additionally, EU funds for civil protection are right now on the chopping block in negotiations over the EU’s budget, with Northern European ‘frugals’ wanting to cut funding. The latest negotiation box would cut EU civil protection funding by 35 percent. Expect a push to resist these frugal cuts at this event.
- Fossil fuel inflation risk – A new report published by the New Economics Foundation makes for grim reading as EU lawmakers are busy slashing away at climate action. It found that fossil fuels pose the biggest inflation risk in nearly all EU countries studied. It finds that every 10-percent jump in oil and gas prices could increase overall European inflation by up to 0.36 percentage points. A 50-percent increase in fossil fuel prices this year could mean an extra 1.8 percentage points of inflation next year. It found that Central and Eastern European countries like Czechia, Bulgaria and Croatia are the most exposed.
- Post-Paris report card – Another recent report has documented the health impacts of inaction on climate change. The 10th Lancet Countdown Report on Health and Climate Change finds that many of the health risks and harms of climate change grew faster in the decade since the Paris Agreement was introduced than in the decade before it. Annual average heat-related deaths rose by nearly 36 percent globally after the Paris Agreement took effect. But it also found that globally, clean energy investment reached a record 2.1 trillion US dollars in 2025 – almost double what was invested in fossil fuels.
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