Written by Martijn Meijer
Dear reader,
Welcome to the latest edition of our monthly EU Energy & Climate Policy Update.
Europe’s bold plan for sustainable growth, the “Clean Industrial Deal”, represents a major shift for EU businesses, especially in energy-intensive sectors. Don’t miss your chance to engage with the Commission to shape this deal and influence the policy direction for the next five years.
The spotlight
The EU-US trade deal
On 21 August, the US and the EU finally issued a joint statement on the trade deal they had agreed to on 27 July. The contents are far-reaching, but whether the EU was able to strike a good deal has been questioned, as can be seen in a headline from Politico this week announcing the advent of Europe’s century of humiliation. But what exactly is in the deal? And the real question: is it all going to be implemented?
The details
For our readers, the most important section of the statement is about the European purchases from and investments in the US. The headline numbers are:
- The EU intends to invest $750 billion worth of US energy products, which include natural gas, oil, and nuclear energy, by 2029;
- The EU intends to purchase at least $40 billion worth of US AI chips for its computing centres;
- European companies are expected to invest an additional $600 billion in strategic sectors in the US by 2029.
That is not all the EU intends to do to satisfy the US in the agreement. The EU intends to eliminate tariffs on all US industrial goods and provide preferential market access to a wide range of foodstuffs.
The bloc also intends to help and address the concerns of the US and its producers and exporters on the EU Deforestation Regulation (EUDR), the Carbon Border Adjustment Mechanism (CBAM), the Corporate Sustainability Due Diligence Directive (CSDDD), and the Corporate Sustainability Reporting Directive (CSRD). Furthermore, the agreement states the EU commits to consult the US on digitalisation procedures and barriers, and the two commit to work together on mutual recognition of car standards, which are far stricter in Europe. Other commitments for cooperation on non-tariff barriers and export restrictions are also mentioned
And what does Europe get? A (temporarily) pleased Trump and:
- The commitment of the US to apply either the US Most Favoured Nation (MFN) tariff rate, or a flat rate of 15 percent, whichever is higher, on European products.
- The intention to ensure that the tariff rate on pharmaceuticals, semiconductors, and lumber does not exceed 15 percent.
- When the EU has removed the tariffs on US industrial goods, the US will reduce tariffs on automobiles and automobile parts.
The implementation question
One might say that the EU is giving up a lot, and the Council would agree. Several Member States, including the Netherlands, Germany, and Hungary, have already criticised the agreement.
On top of that, the import of €250 billion in energy products per year will be almost impossible for the EU. Currently, the EU imports €375 billion in energy products per year (incl. Norway), €76 billion of which comes from the US. Meanwhile, the US only exported $166 billion in oil and gas in 2024. With energy contracts often lasting for a longer period of time, it will not be possible for either side to meet the required trade numbers to reach the goals.
And now? The agreement is not yet legally binding; the Member States will need to approve it, and the EU and the US have already committed to further negotiations. And oh yeah – in the meantime, Trump has already threatened new tariffs on the EU.
Impact analysis for your business
Our free policy updates keep you informed, but is that enough? With our tailored EU Energy & Climate Policy Update you’ll receive:
- Custom insights on how upcoming policy changes might impact your business;
- Strategic advice from your dedicated policy consultant on how to turn challenges into opportunities;
- Early warnings about key legislative developments.
Policy updates
Commission launches consultation on boosting green building loans
On 26 August, the European Commission launched a consultation to help shape new rules aimed at increasing private lending for energy-efficient building renovations — especially for the least efficient properties. This initiative falls under the updated Energy Performance of Buildings Directive (EPBD) and targets financial institutions, lenders, and intermediaries. The consultation, open until 18 November, seeks input on financial products, risk assessment, and data used in financing renovations. A delegated act is planned for early 2026
First commercial CO2 storage launched in Norway
On 25 August, Northern Lights, a joint venture between TotalEnergies, Equinor, and Shell, launched the world’s first commercial carbon capture and storage (CCS) service. The company began injecting CO₂ into a reservoir 2,600 metres beneath the North Sea. Initially, the project can store up to 1.5 million tonnes of CO₂ per year, a capacity set to increase to 5 million tonnes by 2028 with EU funding. While the project first serves Norwegian facilities, it will expand to include volumes from other EU countries. This development comes as the EU looks to create an EU-wide framework for CO₂ infrastructure by 2026 to catch up to nations like Norway.
New EU report published on Carbon Removals
On 21 August, a report prepared for the EU Commission’s climate department, DG CLIMA, indicated that it is exploring options for a new carbon removal programme. The report stresses that large-scale deployment of carbon removals is essential for achieving climate neutrality. For the short term (2025-2030), one proposed solution is an EU-coordinated buyers’ club, possibly managed by a public bank like the European Investment Bank. This club would allow private companies to pool their demand for carbon credits, which would then be used to fund carbon removal purchases. The Commission would cover the initial operating costs and seed funding. Other long-term options being considered include a dedicated EU removals fund or a carbon central bank.
EU to revise ETS and FuelEU based on IMO Net Zero Framework
On 18 August, European Commissioner Wopke Hoekstra stated that the European Commission will analyse the IMO Net Zero Framework once it has been officially adopted. The Commission plans to compare the global framework with the EU’s existing Emissions Trading System (ETS) and FuelEU frameworks. The goal is to identify any potential overlaps and revise the EU legislation if necessary. This approach is intended to prevent a double burden on the maritime sector, ensuring a fair and clear regulatory environment for companies as they navigate the transition to a greener economy.
Commission to boost global climate and energy transition
On 7 August, the European Commission launched a call for evidence on a strategy to boost global climate and energy transition. The initiative aims to boost global climate action by deepening the EU’s partnerships with other countries on climate and energy policies. Building on the 2025 Clean Industrial Deal, it focuses on a strategic approach centred around diplomacy, technical assistance, and economic cooperation.
Clean Industrial Deal
EU kicks off major consultation on CO₂ transport & market rules
On 31 July, the European Commission launched a new call for evidence that could help shape Europe’s green transition: a new initiative to build a competitive, cross-border market and infrastructure for CO₂ transportation and storage.
As part of its strategy to meet the 2040 and 2050 climate targets, the EU is calling on stakeholders and citizens to weigh in on how to create a fully integrated internal market for CO₂, ensuring that captured carbon can move efficiently from industrial emitters to storage sites across borders.
Why does this matter
With EU industry expected to capture up to 450 million tonnes of CO₂ annually by 2050, robust infrastructure and clear market rules are urgently needed. However, current barriers, including regulatory red tape, legal uncertainty, and insufficient infrastructure, are slowing progress and deterring investment. Addressing these challenges is crucial to decarbonise our energy system and meet the EU’s long-term climate goals.
The Commission’s plan?
A potential new legislative framework that could:
- Set EU-wide rules for CO₂ pipelines and storage markets;
- Enable third-party access to infrastructure;
- Provide regulatory clarity and boost investor confidence;
- Lay the groundwork for a market-driven CO₂ value chain.
What’s next?
The call for evidence is now open on the EU’s “Have Your Say” portal until 11 September 2025, with a public consultation expected to be launched in Q4 2025. A final proposal is expected to be published in Q3 2026.
Reach out and do not miss your chance to help shape the backbone of Europe’s carbon management future!
