State of EU Progress to Climate Neutrality

The EU is seeing growth in cleantech manufacturing and solar capacity, but the overall pace of transition remains insufficient. Significant financing gaps, fossil fuel dependencies, and misaligned agricultural policies continue to obstruct the path to climate neutrality.

• The EU is experiencing growth in its cleantech sector, specifically in manufacturing capacities for batteries, electrolysers, heat pumps, solar, and wind. Battery production is currently projected to surpass the 2030 annual target of 550 GWh.
• Solar energy installation reached a record high of 65 GW in 2024, resulting in solar becoming the EU's largest single electricity source by the middle of 2025.
• A substantial climate investment gap of EUR 344 billion in 2023 is impeding the deployment of clean technology and industrial decarbonisation. Progress is further slowed by slow permitting and incentives that continue to favour fossil fuels over electric vehicles, wind power, heat pumps, and building renovations.
• The EU remains vulnerable to geopolitical and climate risks; climate-related economic losses totaled EUR 160 billion from 2021 to 2023, and fossil fuel imports in 2024 reached nearly EUR 400 billion, representing 2% of GDP.
• Social and policy misalignments persist, with 10% of EU citizens experiencing energy poverty. Additionally, the Common Agricultural Policy continues to support emissions-intensive farming despite a decline in beef consumption to below 10 kilograms per capita in 2023.

APA

NewClimate Institute (2025). State of EU Progress to Climate Neutrality. https://newclimate.org/resources/publications/ecnos-2025-flagship-report-state-of-eu-progress-to-climate-neutrality

Chicago

NewClimate Institute. State of EU Progress to Climate Neutrality. 2025. https://newclimate.org/resources/publications/ecnos-2025-flagship-report-state-of-eu-progress-to-climate-neutrality.

Wikipedia

{{cite report |author=NewClimate Institute |title=State of EU Progress to Climate Neutrality |date=3 September 2025 |url=https://newclimate.org/resources/publications/ecnos-2025-flagship-report-state-of-eu-progress-to-climate-neutrality |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{newclimateinstitute2025state, author = {{NewClimate Institute}}, title = {{State of EU Progress to Climate Neutrality}}, institution = {NewClimate Institute}, year = {2025}, month = sep, url = {https://newclimate.org/resources/publications/ecnos-2025-flagship-report-state-of-eu-progress-to-climate-neutrality}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }