Oil crash only a foretaste of what awaits energy industry

Hydrogen Energy Transition advances renewable energy integration via electrolysis, carbon capture and storage, and gas hybrids to decarbonize industry, steel, and transport, enable grid storage, replace ammonia feedstocks, and export clean power across continents.

Key Points

Scaling clean hydrogen with renewables and CCS to cut emissions in power and industry, and enable clean transport.

✅ Electrolysis and CCS provide low-emission hydrogen at scale.

✅ Balances renewables with storage and flexible gas assets.

✅ Decarbonizes steel, ammonia, heavy transport, and exports.

I want you to imagine a highway exclusively devoted to delivering the world’s energy. Each lane is restricted to trucks that carry one of the world’s seven large-scale sources of primary energy: coal, oil, natural gas, nuclear, hydro, solar and wind.

Our current energy security comes at a price, as Europe's power crisis shows, the carbon dioxide emissions from the trucks in the three busiest lanes: the ones for coal, oil and natural gas.

We can’t just put up roadblocks overnight to stop these trucks; they are carrying the overwhelming majority of the world’s energy supply.

But what if we expand clean electricity production carried by the trucks in the solar and wind lanes — three or four times over — into an economically efficient clean energy future?

Think electric cars instead of petrol cars. Think electric factories instead of oil-burning factories. Cleaner and cheaper to run. A technology-driven orderly transition. Problems wrought by technology, solved by technology.

Read more: How to transition from coal: 4 lessons for Australia from around the world

Make no mistake, this will be the biggest engineering challenge ever undertaken. The energy system is huge, and even with an internationally committed and focused effort the transition will take many decades.

It will also require respectful planning and retraining to ensure affected individuals and communities, who have fuelled our energy progress for generations, are supported throughout the transition.

As Tony, a worker from a Gippsland coal-fired power station, noted from the audience on this week’s Q+A program:

The workforce is highly innovative, we are up for the challenge, we will adapt to whatever is put in front of us and we have proven that in the past.

This is a reminder that if governments, industry, communities and individuals share a vision, a positive transition can be achieved.

The stunning technology advances I have witnessed in the past ten years, such as the UK's green industrial revolution shaping the next waves of reactors, make me optimistic.

Renewable energy is booming worldwide, and is now being delivered at a markedly lower cost than ever before.

In Australia, the cost of producing electricity from wind and solar is now around A$50 per megawatt-hour.

Even when the variability is firmed with grid-scale storage solutions, the price of solar and wind electricity is lower than existing gas-fired electricity generation and similar to new-build coal-fired electricity generation.

This has resulted in substantial solar and wind electricity uptake in Australia and, most importantly, projections of a 33% cut in emissions in the electricity sector by 2030, when compared to 2005 levels.

And this pricing trend will only continue, with a recent United Nations report noting that, in the last decade alone, the cost of solar electricity fell by 80%, and is set to drop even further.

So we’re on our way. We can do this. Time and again we have demonstrated that no challenge to humanity is beyond humanity.

Ultimately, we will need to complement solar and wind with a range of technologies such as high levels of storage, including gravity energy storage approaches, long-distance transmission, and much better efficiency in the way we use energy.

But while these technologies are being scaled up, we need an energy companion today that can react rapidly to changes in solar and wind output. An energy companion that is itself relatively low in emissions, and that only operates when needed.

In the short term, as Prime Minister Scott Morrison and energy minister Angus Taylor have previously stated, natural gas will play that critical role.

In fact, natural gas is already making it possible for nations to transition to a reliable, and relatively low-emissions, electricity supply.

Look at Britain, where coal-fired electricity generation has plummeted from 75% in 1990 to just 2% in 2019.

Driving this has been an increase in solar, wind, and hydro electricity, up from 2% to 27%. At the same time, and this is key to the delivery of a reliable electricity supply, electricity from natural gas increased from virtually zero in 1990 to more than 38% in 2019.

I am aware that building new natural gas generators may be seen as problematic, but for now let’s assume that with solar, wind and natural gas, we will achieve a reliable, low-emissions electricity supply.

Is this enough? Not really.

We still need a high-density source of transportable fuel for long-distance, heavy-duty trucks.

We still need an alternative chemical feedstock to make the ammonia used to produce fertilisers.

We still need a means to carry clean energy from one continent to another.

Enter the hero: hydrogen.

Hydrogen could fill the gaps in our energy needs. Julian Smith/AAP Image
Hydrogen is abundant. In fact, it’s the most abundant element in the Universe. The only problem is that there is nowhere on Earth that you can drill a well and find hydrogen gas.

Don’t panic. Fortunately, hydrogen is bound up in other substances. One we all know: water, the H in H₂O.

We have two viable ways to extract hydrogen, with near-zero emissions.

First, we can split water in a process called electrolysis, using renewable electricity or heat and power from nuclear beyond electricity options.

Second, we can use coal and natural gas to split the water, and capture and permanently bury the carbon dioxide emitted along the way.

I know some may be sceptical, because carbon capture and permanent storage has not been commercially viable in the electricity generation industry.

But the process for hydrogen production is significantly more cost-effective, for two crucial reasons.

First, since carbon dioxide is left behind as a residual part of the hydrogen production process, there is no additional step, and little added cost, for its extraction.

And second, because the process operates at much higher pressure, the extraction of the carbon dioxide is more energy-efficient and it is easier to store.

Returning to the electrolysis production route, we must also recognise that if hydrogen is produced exclusively from solar and wind electricity, we will exacerbate the load on the renewable lanes of our energy highway.

Think for a moment of the vast amounts of steel, aluminium and concrete needed to support, build and service solar and wind structures. And the copper and rare earth metals needed for the wires and motors. And the lithium, nickel, cobalt, manganese and other battery materials needed to stabilise the system.

It would be prudent, therefore, to safeguard against any potential resource limitations with another energy source.

Well, by producing hydrogen from natural gas or coal, using carbon capture and permanent storage, we can add back two more lanes to our energy highway, ensuring we have four primary energy sources to meet the needs of the future: solar, wind, hydrogen from natural gas, and hydrogen from coal.

Read more: 145 years after Jules Verne dreamed up a hydrogen future, it has arrived

Furthermore, once extracted, hydrogen provides unique solutions to the remaining challenges we face in our future electric planet.

First, in the transport sector, Australia’s largest end-user of energy.

Because hydrogen fuel carries much more energy than the equivalent weight of batteries, it provides a viable, longer-range alternative for powering long-haul buses, B-double trucks, trains that travel from mines in central Australia to coastal ports, and ships that carry passengers and goods around the world.

Second, in industry, where hydrogen can help solve some of the largest emissions challenges.

Take steel manufacturing. In today’s world, the use of coal in steel manufacturing is responsible for a staggering 7% of carbon dioxide emissions.

Persisting with this form of steel production will result in this percentage growing frustratingly higher as we make progress decarbonising other sectors of the economy.

Fortunately, clean hydrogen can not only provide the energy that is needed to heat the blast furnaces, it can also replace the carbon in coal used to reduce iron oxide to the pure iron from which steel is made. And with hydrogen as the reducing agent the only byproduct is water vapour.

This would have a revolutionary impact on cutting global emissions.

Third, hydrogen can store energy, as with power-to-gas in pipelines solutions not only for a rainy day, but also to ship sunshine from our shores, where it is abundant, to countries where it is needed.

Let me illustrate this point. In December last year, I was privileged to witness the launch of the world’s first liquefied hydrogen carrier ship in Japan.

As the vessel slipped into the water I saw it not only as the launch of the first ship of its type to ever be built, but as the launch of a new era in which clean energy will be routinely transported between the continents. Shipping sunshine.

And, finally, because hydrogen operates in a similar way to natural gas, our natural gas generators can be reconfigured in the future as hydrogen-ready power plants that run on hydrogen — neatly turning a potential legacy into an added bonus.

Hydrogen-powered economy
We truly are at the dawn of a new, thriving industry.

There’s a nearly A$2 trillion global market for hydrogen come 2050, assuming that we can drive the price of producing hydrogen to substantially lower than A$2 per kilogram.

In Australia, we’ve got the available land, the natural resources, the technology smarts, the global networks, and the industry expertise.

And we now have the commitment, with the National Hydrogen Strategy unanimously adopted at a meeting by the Commonwealth, state and territory governments late last year.

Indeed, as I reflect upon my term as Chief Scientist, in this my last year, chairing the development of this strategy has been one of my proudest achievements.

The full results will not be seen overnight, but it has sown the seeds, and if we continue to tend to them, they will grow into a whole new realm of practical applications and unimagined possibilities.

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Nuclear fusion breakthrough signals progress toward clean energy as NIF lasers near ignition and net energy gain, while tokamak designs like ITER advance magnetic confinement, plasma stability, and self-sustaining chain reactions for commercial reactors.

Key Points

A milestone as lab fusion nears ignition and net gain, indicating clean energy via lasers and tokamak confinement.

✅ NIF laser shot approached ignition and triggered self-heating

✅ Tokamak path advances with ITER and stronger magnetic confinement

✅ Net energy gain remains the critical milestone for power plants

Just 100 years ago, when English mathematician and astronomer Arthur Eddington suggested that the stars power themselves through a process of merging atoms to create energy, heat, and light, the idea was an unthinkable novelty. Now, in 2021, we’re getting remarkably close to recreating the process of nuclear fusion here on Earth. Over the last century, scientists have been steadily chasing commercial nuclear fusion, ‘the holy grail of clean energy.’ The first direct demonstration of fusion in a lab took place just 12 years after it was conceptualized, at Cambridge University in 1932, followed by the world’s first attempt to build a fusion reactor in 1938. In 1950, Soviet scientists Andrei Sakharov and Igor Tamm propelled the pursuit forward with their development of the tokamak, a fusion device involving massive magnets which is still at the heart of many major fusion pursuits today, including the world’s biggest nuclear fusion experiment ITER in France.

Since that breakthrough, scientists have been getting closer and closer to achieving nuclear fusion. While fusion has indeed been achieved in labs throughout this timeline, it has always required far more energy than it emits, defeating the purpose of the commercial fusion initiative, and elsewhere in nuclear a new U.S. reactor start-up highlights ongoing progress. If unlocked, commercial nuclear fusion would change life as we know it. It would provide an infinite source of clean energy requiring no fossil fuels and leaving behind no hazardous waste products, and many analysts argue that net-zero emissions may be out of reach without nuclear power, underscoring fusion’s promise.

Nuclear fission, the process which powers all of our nuclear energy production now, including next-gen nuclear designs in development, requires the use of radioactive isotopes to achieve the splitting of atoms, and leaves behind waste products which remain hazardous to human and ecological health for up to tens of thousands of years. Not only does nuclear fusion leave nothing behind, it is many times more powerful. Yet, it has remained elusive despite decades of attempts and considerable investment and collaboration from both public and private entities, such as the Gates-backed mini-reactor concept, around the world.

But just this month there was an incredible breakthrough that may indicate that we are getting close. “For an almost imperceptible fraction of a second on Aug. 8, massive lasers at a government facility in Northern California re-created the power of the sun in a tiny hot spot no wider than a human hair,” CNET reported in August. This breakthrough occurred at the National Ignition Facility, where scientists used lasers to set off a fusion reaction that emitted a stunning 10 quadrillion watts of power. Although the experiment lasted for just 100 trillionths of a second, the amount of energy it produced was equal to about “6% of the total energy of all the sunshine striking Earth’s surface at any given moment.”

“This phenomenal breakthrough brings us tantalizingly close to a demonstration of ‘net energy gain’ from fusion reactions — just when the planet needs it,” said Arthur Turrell, physicist and nuclear fusion expert. What’s more, scientists and experts are hopeful that the rate of fusion breakthroughs will continue to speed up, as interest in atomic energy is heating up again across markets, and commercial nuclear fusion could be achieved sooner than ever seemed possible before. At a time when it has never been more important or more urgent to find a powerful and affordable means of producing clean energy, and as policies like the U.K.’s green industrial revolution guide the next waves of reactors, commercial nuclear fusion can’t come fast enough.

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Site C Dam Controversy highlights Peace River risks, BC Hydro claims, Indigenous rights under Treaty 8, environmental assessment findings, and potential impacts to agriculture and the Peace-Athabasca Delta across Alberta and the Northwest Territories.

Key Points

Debate over BC Hydro's Site C dam: clean energy vs Indigenous rights, Peace-Athabasca Delta impacts, and agriculture.

✅ Potential drying of Peace-Athabasca Delta and wildlife habitat

✅ Treaty 8 rights and First Nations legal challenges

✅ Loss of prime Peace Valley farmland; alternatives in renewables

One of the leading opponents of the Site C dam in northeastern B.C. is sharing her concerns with northerners this week.

Proponents of the Site C dam say it will be a cost-effective source of clean electricity, even as a major Alberta wind farm was scrapped elsewhere in Canada, and that it will be able to produce enough energy to power the equivalent of 450,000 homes per year in B.C. But a number of Indigenous groups and environmentalists are against the project.

Wendy Holm is an economist and agronomist who did an environmental assessment of the dam focusing on its potential impacts on agriculture.

On Tuesday she spoke at a town hall presentation in Fort Smith, N.W.T., organized by the Slave River Coalition. She is also speaking at an event in Yellowknife on Friday, as small modular reactors in Yukon receive study as a potential long-term option.

Worried about downstream impacts, Northern leaders urge action on Site C dam

"I learned that people outside of British Columbia are as concerned with this dam as we are," Holm said.

"There's just a lot of concern with what's happening on the Peace River and this dam and the implications for Alberta, where hydro's share has diminished in recent decades, and the Northwest Territories."

If completed, BC Hydro's Site C energy project will be the third dam on the Peace River in northeast B.C. and the largest public works project in B.C. history. The $10.7-billion project was approved by both the provincial and federal governments as B.C. moves to streamline clean energy permitting for future projects.

Amy Lusk, co-ordinator of the Slave River Coalition, said many issues were discussed at the town hall, but she also left with a sense of hope.

"I think sometimes in our little corner of the world, we are up against so much when it comes to industrial development and threats to our water," she said.

"To kind of take away that message of, this is not a done deal, and that we do have a few options in place to try and stop this and not to lose hope, I think was a very important message for the community."

Drying of the Peace-Athabasca Delta

Holm said her main concern for the Northwest Territories is how it could affect the Peace-Athabasca Delta. She said the two dams already on the river are responsible for two-thirds of the drying that's happening in the delta.

"These are very real issues and very present in the minds of northerners who want to stay connected to a traditional lifestyle, want to have access to those wild foods," she said.

Lusk said northerners are fed up with defending waters "time after time after time."

BC Hydro, however, said studies commissioned during the environmental assessment of Site C show the project will have no measurable effect on the delta, which is located 1,100 kilometres away.

Holm said the fight against the Site C dam is also important when it comes to First Nations treaty rights.

The West Moberly and Prophet River First Nations applied for an injunction to halt construction on Site C, as well as a treaty infringement lawsuit against the B.C. government. They argue the dam would cause irreparable harm to their territories and way of life, which are rights protected under Treaty 8.

Agricultural land

While the project is located in B.C., Holm said its impacts on prime horticulture land would also affect northerners, something that's important given issues of food security and nutrition.

"This is some of the best agriculture land in all of Canada," she said of the Peace Valley.

According to BC Hydro, around 2.6 million hectares of land in the Peace agricultural region would remain available for agricultural production while 3,800 hectares would be unavailable. It has also proposed a number of mitigation efforts, including a $20-million agricultural compensation fund.

Holm said renewable energy, including tidal energy for remote communities, will be cheaper and less destructive than the dam, and there's a connection between the dams on the Peace River and water sharing with the U.S.

"When you run out of water there's nothing else you can use. You can't use orange juice to irrigate your fields or to run your industries or to power your homes," she said.

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Advanced Traffic Light System for Geothermal Safety models fracture growth and friction with rock physics, geophones, and supercomputers to predict induced seismicity during hydraulic stimulation, enabling real-time risk control for ETH Zurich and SED.

Key Points

ATLS uses rock physics, geophones, and HPC to forecast induced seismicity in real time during geothermal stimulation.

✅ Real-time seismic risk forecasts during hydraulic stimulation

✅ Uses rock physics, friction, and fracture modeling on HPC

✅ Supports ETH Zurich and SED field tests in Iceland and Bedretto

The Swiss Earthquake Service and ETH Zurich want to make geothermal energy safer, so news piece from Switzerland earlier this month. This is to be made possible by new software, including machine learning, and the computing power of supercomputers. The first geothermal tests have already been carried out in Iceland, and more will follow in the Bedretto laboratory.

In areas with volcanic activity, the conditions for operating geothermal plants are ideal. In Iceland, the Hellisheidi power plant makes an important contribution to sustainable energy use, alongside innovations like electricity from snow in cold regions.

Deep geothermal energy still has potential. This is the basis of the 2050 energy strategy. While the inexhaustible source of energy in volcanically active areas along fault zones of the earth’s crust can be tapped with comparatively little effort and, where viable, HVDC transmission used to move power to demand centers, access on the continents is often much more difficult and risky. Because the geology of Switzerland creates conditions that are more difficult for sustainable energy production.

Improve the water permeability of the rock

On one hand, you have to drill four to five kilometers deep to reach the correspondingly heated layers of earth in Switzerland. It is only at this depth that temperatures between 160 and 180 degrees Celsius can be reached, which is necessary for an economically usable water cycle. On the other hand, the problem of low permeability arises with rock at these depths. “We need a permeability of at least 10 millidarcy, but you can typically only find a thousandth of this value at a depth of four to five kilometers,” says Thomas Driesner, professor at the Institute of Geochemistry and Petrology at ETH Zurich.

In order to improve the permeability, water is pumped into the subsurface using the so-called “fracture”. The water acts against friction, any fracture surfaces shift against each other and tensions are released. This hydraulic stimulation expands fractures in the rock so that the water can circulate in the hot crust. The fractures in the earth’s crust originate from tectonic tensions, caused in Switzerland by the Adriatic plate, which moves northwards and presses against the Eurasian plate.

In addition to geothermal energy, the “Advanced Traffic Light System” could also be used in underground construction or in construction projects for the storage of carbon dioxide.

Quake due to water injection

The disadvantage of such hydraulic stimulations are vibrations, which are often so weak or cannot be perceived without measuring instruments. But that was not the case with the geothermal projects in St. Gallen 2013 and Basel 2016. A total of around 11,000 cubic meters of water were pumped into the borehole in Basel, causing the pressure to rise. Using statistical surveys, the magnitudes 2.4 and 2.9 defined two limit values ??for the maximum permitted magnitude of the earthquakes generated. If these are reached, the water supply is stopped.

In Basel, however, there was a series of vibrations after a loud bang, with a time delay there were stronger earthquakes, which startled the residents. In both cities, earthquakes with a magnitude greater than 3 have been recorded. Since then it has been clear that reaching threshold values ??determines the stop of the water discharge, but this does not guarantee safety during the actual drilling process.

Simulation during stimulation

The Swiss Seismological Service SED and the ETH Zurich are now pursuing a new approach that can be used to predict in real time, building on advances by electricity prediction specialists in Europe, during a hydraulic stimulation whether noticeable earthquakes are expected in the further course. This is to be made possible by the so-called “Advanced Traffic Light System” based on rock physics, a software developed by the SED, which carries out the analysis on a high-performance computer.

Geophones measure the ground vibrations around the borehole, which serve as indicators for the probability of noticeable earthquakes. The supercomputer then runs through millions of possible scenarios, similar to algorithms to prevent power blackouts during ransomware attacks, based on the number and type of fractures to be expected, the friction and tensions in the rock. Finally, you can filter out the scenario that best reflects the underground.

Further tests in the mountain

However, research is currently still lacking any real test facility for the system, because incorrect measurements must be eliminated and a certain data format adhered to before the calculations on the supercomputer. The first tests were carried out in Iceland last year, with more to follow in the Bedretto geothermal laboratory in late summer, where reliable backup power from fuel cell solutions can keep instrumentation running. An optimum can now be found between increasing the permeability of rock layers and an adequate water supply.

The new approach could make geothermal energy safer and ultimately help this energy source to become more accepted, while grid upgrades like superconducting cables improve efficiency. Research also sees areas of application wherever artificially caused earthquakes can occur, such as in underground mining or in the storage of carbon dioxide underground.

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Ontario electricity shortage is looming, RBC and IESO warn, as EV electrification surges, Pickering nuclear faces delays, and gas plants backstop expiring renewables, raising GHG emissions and grid reliability concerns across the province.

Key Points

A projected supply shortfall as demand rises from electrification, expiring contracts, and delayed nuclear capacity.

✅ RBC warns shortages as early as 2026, significant by 2030

✅ IESO sees EV-driven demand; 5,000-15,000 MW by 2035

✅ Gas reliance boosts GHGs; Pickering life extension assessed

In a fit of ideological pique, Doug Ford’s government spent more than $200 million to scrap more than 700 green energy projects soon after winning the 2018 election, amid calls to make clean, affordable power a central issue, portraying them as “unnecessary and expensive energy schemes.”

A year later, then Associate Energy Minister Bill Walker defended the decision, declaring, “Ontario has an adequate supply of power right now.”

Well, life moves fast. At the time, scrapping the renewable energy projects was criticized as short-sighted and wasteful, raising doubts about whether Ontario was embracing clean power in a meaningful way. It seems especially so now as Ontario confronts the reality of being short of electricity in the coming years.

How short? A recent report by RBC calls the situation “urgent,” saying that Canada’s most populous province could face energy shortages as early as 2026. As contracts for non-hydro renewables and gas plants expire, the shortages could be “significant” by 2030, the bank report said, with grid greening costs adding to the challenge.

The Independent Electricity System Operator (IESO), which manages the electrical supply in Ontario, says demand for electricity could rise at rates not seen in many years, as the government moves to add new gas plants to boost capacity. “Economic growth coming out of the pandemic, along with electrification in many sectors, is driving energy use up,” the agency said in a December assessment.

The good news is that demand is being driven, in part, by the transition to “green” power – carbon-emission-free electricity – by sectors such as transportation and manufacturing. That will help reduce emissions. Yet meeting that demand presents some challenges, prompting the province to outline a plan to address growing needs across the system. The shift to electric vehicles alone is expected to cause a spike in demand starting in 2030. By 2035, the province could need an additional 5,000 to 15,000 megawatts of electricity, the IESO estimates.

It was perhaps no surprise then to see the province announce last week that it wants to delay the long-planned closing of the Pickering nuclear plant by a year to 2026, even as others note the station is slated to close as planned. Operations beyond that would require refurbishing the facility. The province said it’s taking a fresh look at whether that would make sense to extend its life by another 30 years.

In the interim, the province will be forced to dramatically ramp up its reliance on natural gas plants for electricity generation – and, as analysts warn, Ontario’s power mix could get dirtier even before new non-emitting capacity is built, and in the process, increase greenhouse gas emissions from the energy grid by 400 per cent. Broader electrification is expected to produce “significant” GHG emissions reductions in Ontario over the next two decades, according to the IESO. Still, it’s working at cross-purposes if your electric car is charged by electricity generated by fossil fuels.

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Europe EV Sales Slowdown signals waning incentives, economic uncertainty, and supply chain constraints, threatening climate targets and net-zero emissions goals while highlighting the need for charging infrastructure, affordable batteries, and policy support across key markets.

Key Points

Europe's early-2024 EV registrations fell as incentives waned and supply gaps persisted, putting climate targets at risk.

✅ Fewer subsidies and tax breaks cut EV affordability

✅ Inflation and recession fears dampen car purchases

✅ Supply-chain and lithium constraints limit availability

A recent slowdown in Europe's electric vehicle (EV) sales raises serious concerns about the region's ability to achieve its ambitious climate targets.  After years of steady growth, new EV registrations declined in key markets like Norway, Germany, and the U.K. in early 2024. Experts are warning that this slump jeopardizes the transition away from fossil fuels and could undermine Europe's commitment to a net-zero emissions future.

Factors Behind the Decline

Several factors are contributing to the slowdown in EV sales:

• Reduced Incentives: Many European countries have scaled back generous subsidies and tax breaks for EV purchases. While these incentives played a crucial role in driving early adoption, their reduction has made EVs less financially attractive for some consumers, with many U.K. buyers citing higher prices even after discounts.
• End of ICE Ban Support: Public support for phasing out gasoline and diesel-powered cars by 2035, a key European Union policy, appears to be waning in some areas. Without robust support for this measure, consumers may be less inclined to embrace the transition to electric vehicles.
• Economic Uncertainty: Rising inflation and fears of a recession in Europe have made consumers hesitant to invest in big-ticket purchases like new cars, regardless of fuel type. This economic uncertainty is impacting both electric and conventional vehicle sales.
• Supply Chain Constraints: Ongoing supply chain disruptions and shortages of raw materials like lithium continue to impact the availability of affordable electric vehicles. This means potential buyers face long wait times or inflated prices even when they're ready to embrace EVs.

Consequences for Europe's Green Agenda

The decline in EV sales threatens Europe's plans to reduce carbon emissions and become the first climate-neutral continent by 2050, aligning with a broader push for electricity to address the climate dilemma across Europe. The transportation sector is a major contributor to greenhouse gas emissions, and the rapid electrification of vehicles is a pillar of Europe's decarbonization strategy.

The current slump highlights the need for continued policy support for the EV market, as EVs still trail gas models in many markets today, to ensure long-term growth and affordability for consumers. Without action, experts fear that Europe may find itself locked into a dependence on fossil fuels for decades to come, making its climate targets unreachable.

A Global Concern

Europe is a leader in electric vehicle policies and technology, during a period when global EV sales climbed markedly. The recent slowdown, however, sends a worrying signal to other regions around the world aiming to accelerate their transition to electric vehicles, including the U.S. market's Q1 dip as a cautionary example. It underscores the importance of sustained government support, investment in charging infrastructure and overcoming supply chain challenges to secure a future of widespread electric vehicle use, with many forecasts suggesting mass adoption within a decade if support continues.

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