BRUSSELS, Dec. 24 (Xinhua) -- While 2019 marked the European Union's "man on the moon" pledge to achieve carbon neutrality by 2050, 2025 may be remembered as the year that ambition slowed. Economic pressure and a renewed emphasis on competitiveness have driven a policy shift that keeps the climate goal enshrined in law but delays, weakens or reshapes the measures meant to deliver it.
According to the Brussels-based Institute for European Environmental Policy, the EU's political language has changed markedly over the past two years, with concepts such as "sustainability" and "just transition" giving way to new priorities including "simplification, flexibility, competitiveness and security."
As a result, the bloc has increasingly focused over the past year on addressing short-term industrial concerns rather than sustaining the pace of its long-term climate transition.
YEAR OF GREEN RETREAT
The EU's flagship Green Deal, designed to transform the bloc's economy, energy and transport systems, has been steadily eroded by exemptions and delays.
Earlier this month, the EU agreed to further postpone the Deforestation Regulation, a landmark law intended to ensure that products sold in the bloc, including coffee, soy, cocoa and rubber, are not linked to forest destruction.
The delay angered major corporations such as Nestle and Ferrero, which had already invested millions of euros to overhaul their supply chains in anticipation of the rules.
Pierre-Jean Sol Brasier, strategic communications adviser at environmental group Fern, described the move as "a caricature of incompetent EU policymaking," warning that it injects uncertainty into markets the regulation was meant to stabilize.
In the automotive sector, pressure from major car-producing countries, notably Germany and Italy, led the European Commission in April to propose a one-time flexibility measure allowing car and van makers to average carbon dioxide emissions over the 2025-2027 period rather than meet annual targets.
The Commission went further last week by scaling back its original plan to effectively ban new combustion-engine cars by 2035. Under the revised proposal, automakers would be required to cut tailpipe emissions by 90 percent from 2021 levels instead of eliminating them entirely, allowing limited sales of internal combustion vehicles, including plug-in hybrids and range extenders, under specific conditions. The Commission also lowered the interim 2030 emissions-reduction target for vans from 50 percent to 40 percent.
COMPETITIVENESS PANIC
To understand why the Green agenda was rolled back, one must look beyond the corridors of the Berlaymont to the balance sheets of Europe's industrial titans. Analysts widely agree that the driving force in 2025 was not climate skepticism, but profound economic anxiety.
As outlined in a report by former European Central Bank President Mario Draghi on the future of European competitiveness, Europe is suffering from an innovation agony and is being suffocated by high energy costs, a diagnosis that has since become a central tenet of the European Commission's thinking.
Europe's growth has long depended on energy-intensive industries, but disruptions caused by the Russia-Ukraine conflict drove energy prices sharply higher. Although prices have eased since their 2022 peak, industrial electricity costs in Europe remain well above those in the United States, continuing to strain manufacturers, particularly in the automotive and industrial machinery sectors.
High energy costs have also raised the price of producing and operating electric vehicles. Automakers including BMW, Mercedes-Benz and Volkswagen have reported declining operating profits over the first three quarters of this year, while about 51,500 jobs have been lost from Germany's auto industry over the past year.
Fiscal pressures are also mounting. Emil Sondaj Hansen, an analyst at the Institute for Climate Economics, said tight public budgets in France and rising defense spending across the EU are increasingly crowding out climate investment.
HIGH COST OF HESITATION
The European Commission maintains that the policy shift reflects "pragmatism" aimed at protecting jobs in a tougher global environment. Critics, however, warn that the retreat has created a "policy fog" that undermines investment certainty.
"The biggest political risk is the growing normalization of backtracking," said Kai Tegethoff, a Green member of the European Parliament. Reopening agreed standards, he argued, "scrambles the signal for industry," turning a clear trajectory into a stop-and-go process.
After the EU relaxed emissions goals, automakers slowed their push toward electric vehicles and rolled back aggressive pricing, making EVs less competitive. Clean transport group Transport & Environment estimates the easing could lead to a shortfall of about 2 million electric vehicles produced between 2025 and 2027.
"Why would the private sector invest heavily in a track that might be rewritten?" asked Marion Picot of the European Council of Young Farmers, pointing to a similar pullback of capital in agriculture.
For more than a decade, Brussels has relied on the so-called "Brussels Effect," using the weight of its single market to shape global standards. By enforcing strict carbon pricing and clean-technology rules, the EU has often pushed others to follow.
"Credibility erodes when ambition becomes negotiable," said Julian Joswig, a member of the German Bundestag. "If flexibility keeps replacing ambition, Europe will not only lose its leadership role but weaken the global fight against climate change."
