Europe’s push to develop clean energy alternatives at home has taken on a sharper strategic edge, with senior industry figures and policymakers arguing that so-called green molecules – second-generation biofuels and green hydrogen – are no longer primarily a climate story but a matter of industrial survival.
The assessment came at a Euractiv event on June 4, where Spanish energy company Moeve presented findings from an in-depth report on the role of green molecules in Europe’s energy transition.
According to the report, scaling up these technologies could halve Europe’s energy dependence by 2040 and, by 2050, replace up to 50 percent of current fossil fuel demand, account for roughly a third of Europe’s energy mix and cut CO₂ emissions by 22 percent.
Joint action is needed
Maarten Wetselaar, chief executive of Moeve – formerly Cepsa – said the potential was significant but would not materialize without concerted action. “As China moves forward with the clean energy transition, in Europe we need coordinated action between the public and private sectors,” he said, identifying three prerequisites: stable regulatory frameworks that create demand, infrastructure investment and support to close the cost gap in the early stages.
“The question,” he said, “is no longer whether this transition is necessary or even affordable. The real question is whether we act with enough speed and coordination to make it happen.”
Wetselaar identified the Iberian Peninsula as among the most competitive locations in Europe for the production of green molecules, citing its abundant solar and wind resources.
The case for urgency was reinforced by Dirk Niemeier, global director for strategy and energy transition at PwC, who argued that the frame of the debate had fundamentally changed. “The momentum of the green molecule has slowed over the past year. Geopolitics has brought it back, but with a changed framework. This is no longer primarily a climate conversation – it’s about whether Europe maintains its industrial base,” he said.
Shifting production
In Germany, he noted, energy consumption in heavy industry was falling not because of increased efficiency, but because production was being moved abroad.
Niemeier identified infrastructure as the crucial obstacle.
While liquid fuels such as stable aviation fuel or methanol can largely be accommodated within existing systems, hydrogen required entirely new supply chains – pipelines or ship-based logistics, including ammonia terminals and crackers.
“None of this exists at scale today. Every year of delay means another year in which the European industry operates at a cost disadvantage compared to cheap gas American competitors or cheap renewable Asian producers,” he said.
Kitti Nyitrai, deputy director and head of the decarbonisation and sustainability of energy sources unit at the European Commission’s Directorate-General for Energy, acknowledged that Europe was experiencing its second energy crisis in five years, both rooted in fossil fuel dependence.
“But with every crisis, Europe has become more resilient, built infrastructure, diversified and taken action,” she said, adding that the accelerated deployment of renewable energy remains a strategic priority. She pointed to the Commission’s AccelerateEU communication focused on accelerating the deployment of clean energy and reducing import exposure.
Lower cost, access to finance
Nyitrai highlighted biomethane as a ready-to-deploy option, describing it as “a ready and sustainable alternative to fossil gas” that can reduce the risks associated with clean energy projects, lower costs and facilitate access to finance.
Rosita Zilli, director of policy at the European Energy Research Alliance, stressed that direct electrification should remain a priority wherever it is technically and economically possible, but that green molecules will be “indispensable for hard-to-scale industrial processes, heavy transport, aviation, marine applications and long-term energy storage”.
She warned that “a stable and predictable regulatory framework and investment is essential to mobilize private capital, accelerate deployment and give industry the confidence needed to invest in Europe’s clean energy future”.
For cost concerns, Wetselaar tried to reframe the scale of investment required. Noting the more than €400 billion that European governments spent on subsidizing fossil fuel consumption during the energy crisis caused by Russia’s invasion of Ukraine, he argued that the cost of the green transition was “entirely economically feasible, but it requires a lot of political will”.
He described the green molecule opportunity as potentially “one of the most exciting European stories in the next decade”.
The European Commission’s proposed Industrial Accelerator Act aims to support change, aiming to support resilient and decarbonised industrial production across the bloc.
(BM)
