Energy security: Europe’s new compass for the transition

Geopolitical tensions, soaring energy prices, and a deep reliance on imported energy are reshaping the European continent’s approach to its energy future. Energy security is emerging as a powerful catalyst, pushing Europe to reduce its reliance on imported energy, whether from fossil fuels or cleantech. Discover the seven key market trends identified by BrightWolves in our full report.

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The cost crunch

Europe’s energy prices are high compared to other regions in the world. Industrial users across the continent now pay two to two-and-a-half times more for their electricity than their U.S. counterparts.

Although higher energy costs could drive efficiency and innovation, on the short term, Europe’s competitiveness is taking a hit. As a result, some companies are hesitating to invest in the energy transition, even as the need for change grows more urgent.

Source: BrightWolves research, OECD, EU Energy Information Administration, IEA, Eurostat, Statista, BCG

Energy security narrative

The absence of local energy sources in Europe and hence its dependence on imports is one of the drivers causing high prices. These imports meet today’s energy needs but do not strengthen tomorrow’s independence. Each geopolitical shift whether in Russia, the Middle East, or global shipping lanes, exposes Europe to volatility in price and supply. In a world defined by uncertainty, energy dependency has become a strategic liability.

Framing the transition around energy security could help rebuild support. When the public perceives the energy transition not just as a climate imperative but as a path to energy independence, the narrative becomes more compelling. Every new wind turbine, solar panel, or electric vehicle reduces reliance on imported fuels and strengthens Europe’s resilience in turbulent times.

Trading one dependency for another?

As Europe shifts toward an electric future, a new type of dependency might emerge. China currently controls around 80% of the global solar value chain and 70% of battery production. As a result Europe’s aim to achieve its clean energy ambitions might create a new dependency on cleantech largely produced in China.

"7 out of 10 new solar panel installations in Flanders have Chinese-made inverters." - De Tijd

Encouragingly, new partnerships are emerging. Chinese OEMs are entering joint ventures with European partners to build local manufacturing capacity and transfer know-how. These collaborations may be a pragmatic bridge to greater autonomy.

Source: BrightWolves research, S&P Global

An (un)finished story for fossil fuels

Despite the push for renewables, fossil fuels aren’t disappearing overnight. The AI boom and electrification are driving a “demand supercycle” for energy, including gas and LNG. Meanwhile, global oil and gas fields are declining at up to 8% per year. To maintain current production, the industry needs $570 billion in annual investment. As the International Energy Agency framed it: “the sector is running hard to stand still”.

Source: BrightWolves research, IEA, Eurostat

Want to dive deeper? Download our report and explore the seven key trends shaping Europe’s energy transition.

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