The European Commission has proposed giving itself legally-enshrined power to plan the expansion of European electricity grids, as it scrambles to update an ageing network to meet the soaring demands of the clean energy transition. The proposed changes to the Trans-European Networks for Energy, or TEN-E, regulation, would give the Commission power to conduct “central scenario” planning to assess what upgrades are needed to the grid — a marked change from the current decentralized system of grid planning. The Commission would conduct this planning every four years. Where no projects are planned, the Commission would have power to intervene. The proposal was part of the European Grids Package, a sweeping set of changes to EU energy laws released Wednesday. Electrification of everything from transport and heating to industrial processes is essential as Europe moves away from planet-warming fossil fuels. But that puts huge strain on networks, and the Commission estimates electricity demand will double by 2040. An efficient, pan-European electricity grid is essential to meeting this demand. “The European Grids Package is more than just a policy,” said Teresa Ribera, the EU’s decarbonization chief, in a statement Tuesday. “It’s our commitment for an inclusive future, where every part of Europe reaps the benefits of the energy revolution: cheaper clean energy, reduced dependence on imported fossil fuels, secure supply and protection against price shocks.” Along with centralized planning, the Grids Package proposes speeding up permitting of grids and other energy projects to get the infrastructure faster, including relaxing environmental planning rules for grids. Currently planning and building new grid infrastructure takes around 10 years. It would do this by amending four laws: the TEN-E regulation, the Renewable Energy Directive, the Energy Markets Directive, and the Gas Market Directive. The package also proposes “cost-sharing” funding models to ensure those countries that benefit from projects contribute to its financing, and speeding up a number of key energy interconnection projects across Europe.

Iris Ferguson is a global adviser to Loom and a former U.S. deputy assistant secretary of defense for Arctic and global resilience. Ann Mettler is a distinguished visiting fellow at Columbia University’s Center on Global Energy Policy and a former director general of the European Commission. After much pressure, European leaders delayed a decision this week amid division on whether to tighten market access through a “Made in Europe” mandate and redouble efforts to reduce the bloc’s strategic dependencies — particularly on China. This decision may appear technocratic, but the hold-up signals its importance and reflects a larger strategic reality shared across the Atlantic. Security, industry and energy have all fused into a single race to control the systems that power modern economies and militaries. And increasingly, success will hinge on whether the U.S. and Europe can confront this reality together, starting with the one domain that’s shaping every other: energy. While traditional defense spending still grabs headlines, today’s battlefield is being reshaped just as profoundly by energy flows and critical inputs. Advanced batteries for drones, portable power for forward-deployed units and mineral supply chains for next-generation platforms — these all point to the simple truth that technological and operational superiority increasingly depends on who controls the next generation of energy systems. But as Europe and the U.S. look to maintain their edge, they must rethink not just how they produce and move energy, but how to secure the industrial base behind it. Energy sovereignty now sits at the center of our shared security, and in a world where adversaries can weaponize supply chains just as easily as airspace or sea lanes, the future will belong to those who build energy systems that are resilient and interoperable by design. The Pentagon already understands this. It has tested distributed power to shorten vulnerable fuel lines in war games across the Indo-Pacific; it has watched closely how mobile generation units keep the grid alive under Russian attack in Ukraine; and it is exploring ways to deliver energy without relying on exposed logistics via new research on solar power beaming. Each of these cases clearly demonstrates that strategic endurance now depends on energy agility and security. But currently, many of these systems depend on materials and manufacturing chains that are dominated by a strategic rival: From batteries and magnets to rare earth processing, China controls our critical inputs. This isn’t just an economic liability, it’s a national security vulnerability for both Europe and the U.S. We’re essentially building the infrastructure of the future with components that could be withheld, surveilled or compromised. That risk isn’t theoretical. China’s recent export controls on key minerals are already disrupting defense and energy manufacturers — a sharp reminder of how supply chain leverage can be a form of coercion, and of our reliance on a fragile ecosystem for the very technologies meant to make us more independent. So, how do we modernize our energy systems without deepening these unnecessary dependencies and build trusted interdependence among allies instead? The solution starts with a shift in mindset that must then translate into decisive policy action. Simply put, as a matter of urgency, energy and tech resilience must be treated as shared infrastructure, cutting across agencies, sectors and alliances. Defense procurement can be a catalyst here. For example, investing in dual-use technologies like advanced batteries, hardened micro-grids and distributed generation would serve both military needs and broader resilience. These aren’t just “green” tools — they’re strategic assets that improve mission effectiveness, while also insulating us from coercion. And done right, such investment can strengthen defense, accelerate innovation and also help drive down costs. Next, we need to build new coalitions for critical minerals, batteries, trusted manufacturing and cyber-secure infrastructure. Just as NATO was built for collective defense, we now need economic and technological alliances that ensure shared strategic autonomy. Both the upcoming White House initiative to strengthen the supply chain for artificial intelligence technology and the recently announced RESourceEU initiative to secure raw materials illustrate how partners are already beginning to rewire systems for resilience. Germany gave the bloc one such example by moving to reduce its reliance on Chinese-made wind components in favor of European suppliers. | Tan Kexing/Getty Images Finally, we must also address existing dependencies strategically and head-on. This means rethinking how and where we source key materials, including building out domestic and allied capacity in areas long neglected. Germany recently gave the bloc one such example by moving to reduce its reliance on Chinese-made wind components in favor of European suppliers. Moving forward, measures like this need EU-wide adoption. By contrast, in the U.S., strong bipartisan support for reducing reliance on China sits alongside proposals to halt domestic battery and renewable incentives, undercutting the very industries that enhance resilience and competitiveness. This is the crux of the matter. Ultimately, if Europe and the U.S. move in parallel rather than together, none of these efforts will succeed — and both will be strategically weaker as a result. The EU’s High Representative for Foreign Affairs and Security Policy Kaja Kallas recently warned that we must “act united” or risk being affected by Beijing’s actions — and she’s right. With a laser focus on interoperability and cost sharing, we could build systems that operate together in a shared market of close to 800 million people. The real challenge isn’t technological, it’s organizational. Whether it be Bretton Woods, NATO or the Marshall Plan, the West has strategically built together before, anchoring economic resilience with national defense. The difference today is that the lines between economic security, energy access and defense capability are fully blurred. Sustainable, agile energy is now part of deterrence, and long-term security depends on whether the U.S. and Europe can build energy systems that reinforce and secure one another. This is a generational opportunity for transatlantic alignment; a mutually reinforcing way to safeguard economic interests in the face of systemic competition. And to lead in this new era, we must design for it — together and intentionally. Or we risk forfeiting the very advantages our alliance was built to protect.

BRUSSELS — The European Commission has unveiled a new plan to end the dominance of planet-heating fossil fuels in Europe’s economy — and replace them with trees. The so-called Bioeconomy Strategy, released Thursday, aims to replace fossil fuels in products like plastics, building materials, chemicals and fibers with organic materials that regrow, such as trees and crops. “The bioeconomy holds enormous opportunities for our society, economy and industry, for our farmers and foresters and small businesses and for our ecosystem,” EU environment chief Jessika Roswall said on Thursday, in front of a staged backdrop of bio-based products, including a bathtub made of wood composite and clothing from the H&M “Conscious” range. At the center of the strategy is carbon, the fundamental building block of a wide range of manufactured products, not just energy. Almost all plastic, for example, is made from carbon, and currently most of that carbon comes from oil and natural gas. But fossil fuels have two major drawbacks: they pollute the atmosphere with planet-warming CO2, and they are mostly imported from outside the EU, compromising the bloc’s strategic autonomy. The bioeconomy strategy aims to address both drawbacks by using locally produced or recycled carbon-rich biomass rather than imported fossil fuels. It proposes doing this by setting targets in relevant legislation, such as the EU’s packaging waste laws, helping bioeconomy startups access finance, harmonizing the regulatory regime and encouraging new biomass supply. The 23-page strategy is light on legislative or funding promises, mostly piggybacking on existing laws and funds. Still, it was hailed by industries that stand to gain from a bigger market for biological materials. “The forest industry welcomes the Commission’s growth-oriented approach for bioeconomy,” said Viveka Beckeman, director general of the Swedish Forest Industries Federation, stressing the need to “boost the use of biomass as a strategic resource that benefits not only green transition and our joint climate goals but the overall economic security.” HOW RENEWABLE IS IT? But environmentalists worry Brussels may be getting too chainsaw-happy. Trees don’t grow back at the drop of a hat and pressure on natural ecosystems is already unsustainably high. Scientific reports show that the amount of carbon stored in the EU’s forests and soils is decreasing, the bloc’s natural habitats are in poor condition and biodiversity is being lost at unprecedented rates. Protecting the bloc’s forests has also fallen out of fashion among EU lawmakers. The EU’s landmark anti-deforestation law is currently facing a second, year-long delay after a vote in the European Parliament this week. In October, the Parliament also voted to scrap a law to monitor the health of Europe’s forests to reduce paperwork. Environmentalists warn the bloc may simply not have enough biomass to meet the increasing demand. “Instead of setting a strategy that confronts Europe’s excessive demand for resources, the Commission clings to the illusion that we can simply replace our current consumption with bio-based inputs, overlooking the serious and immediate harm this will inflict on people and nature,” said Eva Bille, the European Environmental Bureau’s (EEB) circular economy head, in a statement. TOO WOOD TO BE TRUE Environmental groups want the Commission to prioritize the use of its biological resources in long-lasting products — like construction — rather than lower-value or short-lived uses, like single-use packaging or fuel. A first leak of the proposal, obtained by POLITICO, gave environmental groups hope. It celebrated new opportunities for sustainable bio-based materials while also warning that the “sources of primary biomass must be sustainable and the pressure on ecosystems must be considerably reduced” — to ensure those opportunities are taken up in the longer term. It also said the Commission would work on “disincentivising inefficient biomass combustion” and substituting it with other types of renewable energy. That rankled industry lobbies. Craig Winneker, communications director of ethanol lobby ePURE, complained that the document’s language “continues an unfortunate tradition in some quarters of the Commission of completely ignoring how sustainable biofuels are produced in Europe,” arguing that the energy is “actually a co-product along with food, feed, and biogenic CO2.” Now, those lines pledging to reduce environmental pressures and to disincentivize inefficient biomass combustion are gone. “Bioenergy continues to play a role in energy security, particularly where it uses residues, does not increase water and air pollution, and complements other renewables,” the final text reads. “This is a crucial omission, given that the EU’s unsustainable production and consumption are already massively overshooting ecological boundaries and putting people, nature and businesses at risk,” said the EEB. Delara Burkhardt, a member of the European Parliament with the center-left Socialists and Democrats, said it was “good that the strategy recognizes the need to source biomass sustainably,” but added the proposal did not address sufficiency. “Simply replacing fossil materials with bio-based ones at today’s levels of consumption risks increasing pressure on ecosystems. That shifts problems rather than solving them. We need to reduce overall resource use, not just switch inputs,” she said. Roswall declined to comment on the previous draft at Thursday’s press conference. “I think that we need to increase the resources that we have, and that is what this strategy is trying to do,” she said.

Swiss-based trading house Gunvor on Thursday said it was withdrawing its offer to buy the international assets of Russia’s largest private oil firm after the U.S. said it would “never” approve the deal. “President [Donald] Trump has been clear that the war must end immediately,” the U.S. Treasury Department’s official X account wrote on X. “As long as [Russian President Vladimir] Putin continues the senseless killings, the Kremlin’s puppet, Gunvor, will never get a license to operate and profit.” “The Treasury Department statement is fundamentally misinformed and false,” Gunvor’s company spokesperson Seth Pietras, told POLITICO. “In the meantime, Gunvor withdraws its proposal for Lukoil’s international assets.” The excoriating comments come after Lukoil last week said it had accepted an offer by the multinational trading house to buy its international business after Trump announced sanctions against the energy company. Lukoil said the U.S. Treasury must approve the deal, before it is formally blacklisted on Nov. 21. In Europe, Lukoil holdings include two refineries in Bulgaria and Romania, a 45 percent stake in a Dutch fuel processing facility and around 2,000 petrol stations. Gunvor was co-founded by Swedish billionaire Torbjörn Törnqvist and Gennady Timchenko, one of Putin’s closest allies, in 2000 — and was once the biggest exporter of Moscow’s oil globally. In 2014, days before the U.S. imposed sanctions on Gunvor’s former co-owner following Russia’s annexation of Crimea, Timchenko sold his 43.6 percent stake in the trading house.  Lukoil said the U.S. Treasury must approve the deal, before it is formally blacklisted on Nov. 21. | Sefa Karacan/Getty Images Since then, the trading house has distanced itself from Russia. “Gunvor is and has always been open and transparent about its ownership and business, and has for more than a decade actively distanced itself from Russian trading, selling off its Russian assets, and has publicly condemned the war in Ukraine,” Pietras said. “We welcome the opportunity to ensure this clear misunderstanding is corrected.”

Czechia — one of Ukraine’s staunchest allies — is considering cutting the flow of much-needed arms and ammunition to Kyiv’s forces when its new government takes control in the coming weeks, according to a key leader of the incoming coalition. Filip Turek, the president of the right-wing populist Motorists party that this week signed an agreement to help form a national government, said that his country will “maintain NATO commitments and adherence to international law.” However, he went on, “it will prioritize diplomatic efforts to end the war in Ukraine and mitigate risks of conflict in Europe, shifting from military aid funded by the national budget to humanitarian support and focusing on Czech security needs.” The Motorists party was founded in 2022, and clinched six seats in parliament during last month’s nationwide election, making it a pivotal kingmaker in efforts by prime minister-designate Andrej Babiš and his populist ANO faction to form a government. Turek is under consideration to take on the role of foreign minister in the new administration. Babiš has previously publicly cast doubt on the future of a major program led by the current Czech government to provide tens of thousands of artillery shells to Ukraine, but has avoided publicly committing to a position since the election. Responding to the comments, first reported in POLITICO’s Brussels Playbook, outgoing Czech Foreign Minister Jan Lipavský said, “the limitation of Czech military aid to Ukraine is news that will surely bring great joy to Russian soldiers on the front line. Let’s consider it a Christmas gift from Babiš to Vladimir Putin.” According to Lipavský, whose broad center-right platform suffered defeat in October’s election, the new coalition’s policy statements “do not mention the word Russia even once,” and fail to face up to the Kremlin’s aggression. “The new government will be undermining the security of the Czech Republic,” Lipavský said. Turek added that the new Czech government would deal with Moscow in a manner “guided by pragmatic protection of national interests” and avoid “escalation that could endanger Czechia’s energy security or economic stability.” A “broader focus on sovereignty and non-intervention suggests a cautious, interest-based approach,” he said. While the Czech government may change the types of aid it provides to Ukraine, the EU’s main plan to finance Kyiv next year hinges on the use of Russian frozen assets currently held in Belgium. Brussels is in the process of deciding whether to support those measures, and it’s unclear whether Prague would oppose such a move. Babiš, tasked with forming a government within the next month, may face opposition from President Petr Pavel over Turek’s nomination. The likely next foreign minister has faced police investigation over inflammatory social media posts, some of which he has apologized for and others of which he has denied authorship. EU STANCE At the same time, Turek said Prague would prioritize being “a sovereign, confident member of the EU and a firm ally in NATO,” but simultaneously “resist further transfers of powers to Brussels and advocate for a union based on unanimity, mutual respect, and pragmatic policies that avoid overburdening citizens with regulations.” The former racing car driver, who until last month served as a member of the European Parliament and campaigned on an anti-Green Deal platform, branded eco-conscious policies “unsustainable,” calling for a reversal of the 2035 ban on the sale of cars with combustion engines and for emissions trading systems to be dropped altogether. “Real change requires Brussels to prioritize factory floors and family budgets over ideological agendas that only accelerate the offshoring of sophisticated European production to China,” Turek said, “where less efficient plants and long-distance shipping generate higher global emissions, paradoxically contradicting the very climate objectives Brussels claims to pursue.” Babiš will have to present his proposed list of ministers to Czech President Petr Pavel in the coming days before a vote of confidence in the new government can be held.

Disclaimer: POLITICAL ADVERTISEMENT * The sponsor is Polish Electricity Association (PKEE) * The advertisement is linked to policy advocacy on energy transition, electricity market design, and industrial competitiveness in the EU. More information here The European Union is entering a decisive decade for its energy transformation. With the international race for clean technologies accelerating, geopolitical tensions reshaping markets and competition from other major global economies intensifying, how the EU approaches the transition will determine its economic future. If managed strategically, the EU can drive competitiveness, growth and resilience. If mismanaged, Europe risks losing its industrial base, jobs and global influence.  > If managed strategically, the EU can drive competitiveness, growth and > resilience. If mismanaged, Europe risks losing its industrial base, jobs and > global influence. This message resonated strongly during PKEE Energy Day 2025, held in Brussels on October 14, which brought together more than 350 European policymakers, industry leaders and experts under the theme “Secure, competitive and clean: is Europe delivering on its energy promise?”. One conclusion was clear: the energy transition must serve the economy, not the other way around.  Laurent Louis Photography for PKEE The power sector: the backbone of Europe’s industrial future  The future of European competitiveness will be shaped by its power sector. Without a successful transformation of electricity generation and distribution, other sectors — from steel and chemicals to mobility and digital — will fail to decarbonize. This point was emphasized by Konrad Wojnarowski, Poland’s deputy minister of energy, who described electricity as “vital to development and competitiveness.”  “Transforming Poland’s energy sector is a major technological and financial challenge — but we are on the right track,” he said. “Success depends on maintaining the right pace of change and providing strong support for innovation.” Wojnarowski also underlined that only close cooperation between governments, industry and academia can create the conditions for a secure, competitive and sustainable energy future.  Flexibility: the strategic enabler  The shift to a renewables-based system requires more than capacity additions — it demands a fundamental redesign of how electricity is produced, managed and consumed. Dariusz Marzec, president of the Polish Electricity Association (PKEE) and CEO of PGE Polska Grupa Energetyczna, called flexibility “the Holy Grail of the power sector.”  Speaking at the event, Marzec also stated “It’s not about generating electricity continuously, regardless of demand. It’s about generating it when it’s needed and making the price attractive. Our mission, as part of the European economy, is to strengthen competitiveness and ensure energy security for all consumers – not just to pursue climate goals for their own sake. Without a responsible approach to the transition, many industries could relocate outside Europe.”  The message is clear: the clean energy shift must balance environmental ambition with economic reality. Europe cannot afford to treat decarbonization as an isolated goal — it must integrate it into a broader industrial strategy.  > The message is clear: the clean energy shift must balance environmental > ambition with economic reality. The next decade will define success  While Europe’s climate neutrality target for 2050 remains a cornerstone of EU policy, the next five to ten years will determine whether the continent remains globally competitive. Grzegorz Lot, CEO of TAURON Polska Energia and vice-president of PKEE, warned that technology is advancing too quickly for policymakers to rely solely on long-term milestones.  “Technology is evolving too fast to think of the transition only in terms of 2050. Our strategy is to act now — over the next year, five years, or decade,” Lot said. He pointed to the expected sharp decline in coal consumption over the next three years and called for immediate investment in proven technologies, particularly onshore wind.  Lot also raised concerns about structural barriers. “Today, around 30 percent of the price of electricity is made up of taxes. If we want affordable energy and a competitive economy, this must change,” he argued.  Consumers and regulation: the overlooked pillars  A successful energy transition cannot rely solely on investment and infrastructure. It also depends on regulatory stability and consumer participation. “Maintaining competitiveness requires not only investment in green technologies but also a stable regulatory environment and active consumer engagement,” Lot said.  He highlighted the potential of dynamic tariffs, which incentivize demand-side flexibility. “Customers who adjust their consumption to market conditions can pay below the regulated price level. If we want cheap energy, we must learn to follow nature — consuming and storing electricity when the sun shines or the wind blows.”  Strategic investments for resilience  The energy transition is more than a climate necessity. It is a strategic requirement for Europe’s security and economic autonomy. Marek Lelątko, vice-president of Enea, stressed that customer- and market-oriented investment is essential. “We are investing in renewables, modern gas-fired units and energy storage because they allow us to ensure supply stability, affordable prices and greater energy security,” he said.  Grzegorz Kinelski, CEO of Enea and vice-president of PKEE, added: “We must stay on the fast track we are already on. Investments in renewables, storage and CCGT [combined cycle gas turbine] units will not only enhance energy security but also support economic growth and help keep energy prices affordable for Polish consumers.”  The power sector must now be recognized as a strategic enabler of Europe’s industrial future — on par with semiconductors, critical raw materials and defense. As Dariusz Marzec puts it: “The energy transition is not a choice — it is a necessity. But its success will determine more than whether we meet climate targets. It will decide whether Europe remains competitive, prosperous and economically independent in a rapidly changing world.”  > The power sector must now be recognized as a strategic enabler of Europe’s > industrial future — on par with semiconductors, critical raw materials and > defense. Measurable progress, but more is needed  Progress is visible. The power sector accounts for around 30 percent of EU emissions but has already delivered 75 percent of all Emissions Trading System reductions. By 2025, 72 percent of Europe’s electricity will come from low-carbon sources, while fossil fuels will fall to a historic low of 28 percent. And in Poland, in June, renewable energy generation overtook coal for the first time in history.  Still, ambition alone is not enough. In his closing remarks, Marcin Laskowski, vice-president of PKEE and executive vice-president for regulatory affairs at PGE Polska Grupa Energetyczna, stressed the link between the power sector and Europe’s broader economic transformation. “The EU’s economic transformation will only succeed if the energy transition succeeds — safely, sustainably and with attractive investment conditions,” he said. “It is the power sector that must deliver solutions to decarbonize industries such as steel, chemicals and food production.”  A collective European project  The event in Brussels — with the participation of many high-level speakers, including Mechthild Wörsdörfer, deputy director general of DG ENER; Tsvetelina Penkova, member of the European Parliament and vice-chair of the Committee on Industry, Research and Energy; Thomas Pellerin-Carlin, member of the European Parliament; Catherine MacGregor; CEO of ENGIE and vice-president of Eurelectric; and Claude Turmes, former minister of energy of Luxembourg — highlighted a common understanding: the energy transition is not an isolated environmental policy, it is a strategic industrial project. Its success will depend on coordinated action across EU institutions, national governments and industry, as well as predictable regulation and financing.  Europe’s ability to remain competitive, resilient and prosperous will hinge on whether its power sector is treated not as a cost to be managed, but as a foundation to be strengthened. The next decade is a window of opportunity — and the choices made today will shape Europe’s economic landscape for decades to come. 

Russian President Vladimir Putin has ordered his government to develop a roadmap for mining rare earth metals, as Moscow seeks to join the global race for the strategically vital resources. Putin called for an “action plan” to be ready by Dec. 1 “for the long-term development of the extraction and production of rare and rare earth metals,” state-owned Russian media outlet TASS reported Tuesday. Rare earths — essential components in everything from smartphones and electric vehicles to wind turbines — are increasingly seen as critical to technology and energy security, earning the attention of leaders such as U.S. President Donald Trump. Russia contributes only about one percent of global rare earth production despite possessing vast reserves. According to the Kremlin’s estimate, the country holds reserves of 15 rare earth metals totaling 28.5 million tons. China currently dominates the market, producing about two-thirds of the world’s supply and accounting for almost half of the EU’s imports. Although the EU has sought to diversify its sources, mining and processing rare earths is complex and costly, leaving the bloc heavily dependent on Beijing. Antonia Zimmermann contributed to this report.

BRUSSELS — In the midst of a geopolitical storm, Brussels is racing to put together a new plan by the end of this year to diversify European supply of so-called critical raw materials — such as lithium and copper — away from China.  The thing is: We’ve been here before. So far, the European Commission has provided few details on its new plan, beyond that it would touch upon joint purchasing, stockpiling, recycling of resources and new partnerships. It already addressed those measures two years ago in its first initiative on the issue, the Critical Raw Materials Act.  Commission chief Ursula von der Leyen has been forced to act by Beijing’s expansion and tightening of export controls on rare earths and other critical minerals this month, as trade tensions with Washington escalated. Europe was caught in the crossfire — China accounts for 99 percent of the EU’s supply of the 17 rare earths, and 98 percent of its rare earth permanent magnets. The new “RESourceEU” plan is expected to follow a similar model to the REPowerEU plan, under which the Commission in 2022 proposed investing €225 billion to diversify energy supply routes after Russia’s illegal invasion of Ukraine.  That has European industry daring to hope that Brussels will do more than just recycle an old initiative and address the main obstacles to diversifying the bloc’s supply chains of minerals it needs for everything from renewable energy to defense applications. The biggest of them all? A lack of cash to back new mining, processing and manufacturing initiatives, both within and outside the EU. “It’s all still very much in its infancy,” said Florian Anderhuber, deputy director general of lobby group Euromines. “We hope that there will be a bigger push that goes beyond the implementation of the Critical Raw Materials Act,” he added. “It doesn’t help anyone if this is just a label for things that are already in the pipeline.” CODEPENDENT RELATIONSHIP The EU should not count on any trade reprieve that may result from U.S. President Donald Trump’s meeting with Chinese counterpart Xi Jinping on Thursday. After all, Beijing has shown time and again that it has no reservations about weaponizing economic dependencies. The key question is whether, this time around, pressure will remain high enough for the EU to mobilize brainpower and assets at the kind of scale it did when it sought to break the bloc’s decades-old reliance on Russian oil and gas. “Europe cannot do things the same way anymore,” von der Leyen said as she announced the initiative last weekend. “We learned this lesson painfully with energy; we will not repeat it with critical materials. So it is time to speed up and take the action that is needed.” “Europe cannot do things the same way anymore,” von der Leyen said as she announced the initiative last weekend. | Costfoto/NurPhoto via Getty Images In the here and now, the EU wants to persuade a visiting Chinese delegation at talks in Brussels on Friday to speed up export approvals for its top raw materials importers. In parallel, energy and environment ministers from the G7 group of industrialized nations are slated to wargame how to de-risk their mineral supply chains in Toronto, Canada, on Thursday and Friday. MONEY, MONEY, MONEY When the Commission unveiled its first grand plan to break over-reliance on China in 2023 — the Critical Raw Materials Act (CRMA) — industry leaders and analysts mostly lamented one thing: a lack of funding on the table.  “Money has been a real bottleneck for Europe’s raw materials agenda,” said Tobias Gehrke, a senior policy fellow at the European Council on Foreign Relations. “Mining, processing, recycling, and stockpiling all need serious financing.” If the EU fails to free up more resources, experts warn that it is bound to fall short of the goal set in the CRMA, of extracting at least 10 percent of its annual consumption of select minerals by the end of the decade, with no more than 65 percent of some raw materials coming from a single country. It’s a steep target — especially for rare earths, where Beijing has over decades built up a de facto monopoly. While the EU executive has selected strategic projects both within and outside the EU that should benefit from faster permitting than their usual lead times of 10 to 15 years to production, those efforts are yet to bear fruit. “To finance such projects, the next EU budget must provide substantial, dedicated [Critical Raw Material] funding, and financial institutions must deploy innovative de-risking and financing tools,” the European Initiative for Energy Security argues in a new report, calling for a “permanent European Minerals Investment Network.”  “To finance such projects, the next EU budget must provide substantial, dedicated [Critical Raw Material] funding, and financial institutions must deploy innovative de-risking and financing tools,” the European Initiative for Energy Security argues in a new report. | Aris Oikonomou/AFP via Getty Images The REPowerEU plan — a package of documents, including legal acts, recommendations, guidelines and strategies — was mostly financed by loans left over from the bloc’s pandemic recovery program. Similarly, RESourceEU must become “resource strategy backed by real funding,” said Hildegard Bentele, a member of the European Parliament who’s been working on critical minerals for years.  “This requires a European Raw Materials Fund, modelled on successful instruments in several Member States, to support strategic projects across the entire value chain, from extraction to recycling,” the German Christian Democrat said. THAT’LL COST YOU It’s about more than just throwing money at the problem: The Commission’s haste in rolling out its plan is raising doubts that it will meet the needs of a highly complex market — along with concerns that environmental safeguards will be neglected. “As long as European industries can buy cheaper materials from China, other producers do not stand a chance,” warned Gehrke.  In Toronto, G7 ministers will launch a new Critical Minerals Production Alliance (CMPA), a Canadian-led initiative that seeks to secure “transparent, democratic, and environmentally responsible critical minerals,” and also to counter market manipulation of supply chains, said a senior Canadian government official.  This would suggest creating so-called standards-based markets that are ring-fenced to protect critical minerals produced responsibly, to agreed environmental and social standards. A price floor would be set within that market, while minerals produced elsewhere — at lower prices but also lower standards — would face a tariff.  Beyond the immediate funding issues, ramping up mining in the EU and its neighbourhood also comes at a high societal cost. With local resistance to new mines, usually linked to environmental and social concerns, being one of the key obstacles to new projects, investors are often hesitant to pour money into a project that risks being derailed shortly after. “The EU is choosing geopolitical expediency over human rights and ecological integrity, sacrificing frontline communities for a strategy that is neither sustainable nor just, instead of building a durable and values-based autonomy that invests in systemic circularity and rights-based partnerships,” said Diego Marin, a senior policy officer for raw materials and resource justice at the European Environmental Bureau, an NGO.  Jakob Weizman and Camille Gijs contributed reporting from Brussels. Zi-Ann Lum contributed reporting from Toronto, Canada.

BRUSSELS — Donald Trump’s surprise move to sanction Russia’s largest oil companies won’t paralyze Vladimir Putin’s war machine — but it will help the EU kick Russian oil out of the bloc for good. On Wednesday, Trump announced “tremendous” new sanctions targeting Russia’s Lukoil and its state-owned Rosneft, marking the first U.S. sanctions on Moscow since he took office.  The details of the new measures are still being worked out. But in theory, they threaten to force the two firms to sell their assets and end their remaining oil pipeline supplies to Europe. “This is a significant step,” said Kimberly Donovan, a sanctions expert at the Atlantic Council think tank, “and it is going to force … European countries and companies that have been continuing to import energy to reconsider those transactions” by Nov. 21, when the sanctions kick in. The announcement comes a month after Trump lambasted Europe for “inexcusably” continuing to buy energy from Russia, which in total provides a quarter of income for the Kremlin’s war chest.  At the time, he also issued an ultimatum to Europe, writing: “I am ready to do major Sanctions on Russia when all NATO Nations have agreed, and started, to do the same thing, and when all NATO Nations STOP BUYING OIL FROM RUSSIA.” Now, he’s followed through. DAMAGE, NOT DESTROY For Moscow, the new sanctions will mean immediate pain, but are unlikely to curtail its war effort in Ukraine. Rosneft and Lukoil account for around two-thirds of the 4.4 million barrels of crude Russia exports each day, according to David Fyfe, chief economist at the Argus media consultancy. The sanctions threaten to take out “half” of those supplies, he said, given the measures prevent the two firms from selling their cargoes in dollars, the currency used almost exclusively for trading crude internationally. For Lukoil in particular, the sanctions “will hurt significantly,” said one former executive at the company, who was granted anonymity to speak candidly about sensitive matters. The firm will likely have to sell its stakes in overseas projects from Egypt to Iraq, the person said, hitting up to 20 percent of its revenue. But the majority of Chinese and Indian buyers, Russia’s two largest oil trading partners, are likely to continue importing from Moscow, said Homayoun Falakshahi, head of crude oil analysis at the Kpler commodities firm, given its cheaper prices and limited alternatives in the case of China. Rosneft and Lukoil account for around two-thirds of the 4.4 million barrels of crude Russia exports each day, according to David Fyfe, chief economist at the Argus media consultancy. | Olga Maltseva/AFP via Getty Images After an initial period of hiatus, “most buyers would go back into buying,” he said, once they have found workarounds including purchasing cargoes via companies that obscure their Russian ownership. “This will complicate exports and trade,” said Vladimir Milov, a former Russian deputy energy minister-turned-Putin critic. But “these companies … already have alternative work schemes in place, so there will be damage but it’ll be limited.” On Thursday, Putin himself admitted the new sanctions were “serious,” while blasting the move as an “unfriendly act that does nothing to strengthen Russian-American relations.” LINGERING PRESENCE But one place where the measures are likelier to have a clear effect is Europe. Since Moscow launched its full-scale invasion of Ukraine more than three years ago, the EU has strained to end its reliance on Russia for energy.  Brussels has slapped an embargo on Russian crude, fuel and coal entering the bloc by sea; and has whittled down the Kremlin’s share in the EU’s gas market from 45 to 13 percent. (It is now finalizing a bill that would bring that down to zero.)  Rosneft, which once owned refineries and controlled oil flows to Germany, has been largely dispossessed in Europe after Berlin took control of its local subsidiary in late 2022.  “We assume that the measures taken by the United States … are not intended to target Rosneft’s subsidiaries in Germany, which are held in trust by the German states,” said a spokesperson for the German economy ministry. On Thursday, the EU also tightened its sanctions against the Kremlin-controlled company. But it’s a different story with Lukoil. Russia’s largest private oil firm runs hundreds of gas stations across the EU, including around 200 in Belgium; operates giant refineries in Romania and Bulgaria; and retains a 45 percent share of a fuel processing plant in the Netherlands. It also supplies oil to Hungary and Slovakia, which still rely on Moscow for between 86 and 100 percent of their imports. Exploiting a sanctions opt-out, the two countries have stubbornly resisted ditching Moscow — despite intense pressure from the EU. So far, Brussels has repeatedly failed to target the company despite being linked to sanctions circumvention in the bloc. Neither Rosneft nor Lukoil responded to POLITICO’s requests for comment. OUT OF LUKOIL Now things are set to change.  The U.S. Treasury has said it “may” impose sanctions on anyone working with the Russian firms, meaning no bank will now handle payments for them in Europe, said Donovan, the sanctions expert. “It’s going to be a huge signal to [European banks and businesses] that they really need to step away from this, or otherwise they’re exposing themselves to sanctions,” she said. On Thursday, the European Commission said it too was mulling its own transaction ban against Lukoil. For Hungary and Slovakia, in particular, the new sanctions are sparking anxieties that oil flows could be cut off entirely. If enforced, it “would lead to the stopping of imports,” acknowledged one Slovak official, also granted anonymity to speak frankly, saying the government will “most likely” seek an exemption from Washington. Hungary’s foreign ministry didn’t respond to a request for comment. In fact, the impacts of the measures are already starting to be seen. Finnish energy firm Neste on Thursday suspended fuel deliveries to Lukoil subsidiary Teboil after the U.S. and U.K. sanctions against the firm.  Romania’s state secretary for energy, Cristian Bușoi, told POLITICO that Lukoil will now have “an obligation” to sell its south-central Petrotel refinery before next month’s deadline. “We would be happy not to have Lukoil anymore,” he added. The Dutch government, too, now sees a quick sale of Lukoil’s stake in its southwestern Zeeland refinery as “the most likely scenario,” according to a person familiar with the matter. Bulgaria’s eastern Neftochim refinery will also “have to stop operation on Nov. 21” unless it is sold, added Martin Vladimirov, a senior energy analyst at the Sofia-based Center for the Study of Democracy think tank. The Bulgarian energy ministry declined to comment. “They’ll have to be sold,” echoed the former Lukoil executive. For the company, it will be “catastrophic,” the person added. Koen Verhelst contributed to this report.

STRASBOURG — Europe should protect its share of market from global competitors’ investment in green tech, Commission President Ursula von der Leyen said Wednesday. Von der Leyen said European Union leaders will discuss the issue during their Thursday summit. “The clean transition is in full swing,” she said during a debate in the European Parliament, pointing out how every year, hundreds of gigawatts of energy are added globally. “Cleantech markets around the world are booming,” including batteries, wind turbines and electric cars. “The rise in cleantech in Europe is also good news for energy security, and it is a great economic opportunity,” she added. Yet, she warned, Europe in the past missed out on chances to lead on green industry, with the loss of solar panel industry to more competitive Chinese companies being “a cautionary tale that we must not forget.” “Europe was a global leader in solar, but heavily subsidized Chinese competitors started to outprice Europe’s young industry — and today, China controls 90 percent of the global market.” “This time, we should learn our lesson,” she added, name-checking the Middle East and the “Global South” as regions competing for their spot in the global industrial green tech race. The European Commission expects renewables and other forms of clean energy to supply 50 percent of energy globally, while the cleantech market is projected to grow from €600 billion to €2 trillion over the next 10 years. The EU wants to capture 15 percent of the global production of clean technologies, with the EU market growing to €375 billion by 2035, according to Commission projections.