The European Clean Industrialization Path: Structural Challenges and Opportunities from Energy System Transformation to the Electric Vehicle Industry

Europe faces complex structural contradictions in addressing climate change and energy transition: on one hand, the decarbonization process of the EU power system is accelerating, and the penetration rate of renewable energy (such as wind and solar) is significantly increasing, but the actual electrification rate in final energy consumption is stagnating, which constitutes a core bottleneck in achieving the climate goals for 2030 and 2050. This disconnect is not only a technical challenge for the energy system but also a severe test for Europe's overall economic structure and industrial upgrading strategy.

In the transportation sector, electric vehicles (EVs) are seen as key to decarbonizing transport, but their adoption rate is far below expectations. Although the EU has set a regulatory target for zero emissions by 2035, the challenges facing European manufacturers are not purely technical; they involve cost competitiveness, the uneven regional deployment of charging infrastructure, and market distortions caused by import tariffs on battery electric vehicles (BEVs). The high initial purchase price and unstable subsidy policies limit the market penetration of European domestic EV models, especially for low- and middle-income groups, highlighting the need for policy design to shift from being subsidy-driven to having more structural industrial support and cost reduction mechanisms.

From the perspective of industrial and supply chain resilience, Europe is at a critical juncture in clean technology manufacturing, particularly in the battery sector. Data shows that Europe is rapidly catching up to domestic demand in terms of electric vehicle assembly capacity; however, in the manufacturing of key battery cells, Europe remains highly dependent on foreign facilities and imported raw materials, exposing its vulnerability in the value chain. This is not just about the energy transition; it is about whether Europe can achieve "green growth" rather than "deindustrialization."

To ensure the political sustainability of the green strategy, the EU is reshaping this process through the "Clean Industrial Deal." This agreement aims to closely link decarbonization targets with economic competitiveness, promoting the green transformation of traditional industries while nurturing emerging clean technology sectors. However, the challenge in achieving this goal lies in data transparency and cross-sectoral coordination efficiency. A lack of comprehensive, timely, and coherent data on industrial decarbonization and clean technology manufacturing makes it easy for policymakers to fall into fragmented and emotional debates when assessing trends. Therefore, establishing open data platforms like the Bruegel European Clean Technology Tracker is a key infrastructure for bridging the information gap and ensuring that policymakers make decisions based on facts rather than anecdotes.

In the future, Europe's success will depend on its ability to achieve synergistic development in the following dimensions: first, accelerating the increase in the final electrification rate of energy, which requires solving structural barriers in the transport sector; second, building an industrial ecosystem capable of effectively reducing EV costs and accelerating the construction of charging networks; and third, creating a policy framework that balances "green transition" with "deindustrialization," ensuring that industrial upgrading creates new green jobs rather than the demise of old models. Europe's green future is essentially a complex game of industrial restructuring and strategic autonomy.