European Leaders Stress Decarbonization for Economic Competitiveness

European leaders and business executives are increasingly aligning on a message that decarbonization is not just a climate imperative but a key driver of economic competitiveness. Former ECB President Mario Draghi emphasized this link in a 2024 report, stressing that energy prices and decarbonization strategies are central to Europe’s ability to maintain its global standing. His analysis, along with warnings from JPMorgan CEO Jamie Dimon, has underscored a broader consensus that Europe must reinvent its economic model to address declining global GDP share and the absence of new industrial or tech giants over the past decade [1].

Draghi’s report highlighted the need for energy independence, linking it directly to the continent’s competitiveness. European industrial electricity prices, currently 2-4 times higher than in the U.S., are a significant drag on growth and industrial development. With traditional economic anchors such as Russian energy and Chinese export markets no longer reliable, the message is clear: Europe must adapt or risk further economic decline [1].

The urgency of these arguments has gained traction across both political and business circles. In a June meeting in Brussels, 60 business leaders, including SAP CEO Christian Klein and Ingka CEO Jesper Brodin, endorsed the need for a stronger European energy infrastructure. “Russia won’t come back,” said Klein, “so we should rather invest in infrastructure and the grid to have access to other sources of energy.” Brodin concurred, noting that the invasion of Ukraine has strengthened support for European energy independence across sectors [1].

European Commission Vice President Stéphane Séjourné has framed the Draghi report as a foundational document for the new economic consensus. “Decarbonization is not just a climate plan, it is an economic strategy,” he stated, emphasizing the need for coordinated and accelerated action on energy and regulatory reforms [1]. One such reform is the proposed “28th regime,” which would allow businesses to operate across all EU countries without the need for separate national entities, streamlining a fragmented market [1].

Despite the growing political will, structural challenges remain. The EU imports more than 10 million barrels of oil equivalent per day, while domestic production from the North Sea has dropped from 4.4 million to just 1 million barrels over 25 years. Electricity, including renewable sources, currently accounts for only 23% of total energy consumption, highlighting the scale of the infrastructure and policy shift needed [1].

To overcome these hurdles, European leaders are advocating for a more integrated approach to energy policy. The vision is for a continent where governments collaborate on energy strategies rather than acting unilaterally, reducing bureaucratic bottlenecks and speeding up the transition to homegrown energy sources like wind and solar [1].

However, as noted by Simone Tagliapietra of the Bruegel think tank, political commitment alone may not be sufficient. “Europe is trapped” by its reliance on imported fossil fuels and inconsistent regulations. The continent must now navigate the dual challenge of decarbonization and competitiveness, ensuring that its economic strategy is not only sustainable but also globally competitive [1].

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[1] title:“Decarbonization is not just a climate plan, it is an economic strategy.” Why European competitiveness hinges on homegrown power

url:https://fortune.com/europe/2025/08/05/decarbonization-not-just-a-climate-plan-economic-strategy-why-european-competitiveness-hinges-on-homegrown-power-mario-draghi-von-der-leyen/