Power Plays: Europe’s Response to the Energy Crisis

Russia’s full-scale invasion of Ukraine in February 2022 triggered a severe energy crisis in Europe. The shock represented a test not just of Europe’s energy sector but of the resilience of Europe’s democratic political system and market economies. The results of Europe’s actions have been remarkable. The European Union and its member states have reckoned with the false promise of energy interdependence with Russia, taken ambitious steps to enhance domestic energy supply capacities, and dramatically expanded renewables. However, while the results of Europe's actions have been impressive, challenges remain in areas spanning electricity market reform to hydrogen diplomacy, protection of critical undersea infrastructure, and import dependencies in clean tech supply chains. The crisis also left a significant fiscal mark on European economies and, through price shock and inflationary effects, gave rise to more anti-establishment parties, many of which may seek to roll back aspects of the energy transition.

This report is made possible by the generous support of the Public Power Corporation S.A.