EU Budget: €2 trillion for the green transition

On July 16, the European Commission presented its proposal for the next Multiannual Financial Framework 2028-2034 in Brussels. Thanks to the introduction of new own resources, the Union's budget could reach nearly €2 trillion . A lengthy negotiation process, involving the European Parliament and the Council, is now underway, with the goal of approving the new financial framework by January 1, 2028.

In the document, the European executive reaffirms its support for the green transition , announcing a doubling of funding for research and innovation and a fivefold increase for energy infrastructure. Among the most significant points is the introduction of a cross-cutting target: 35% of total spending must be allocated to climate and environmental action . This clear direction, at least on paper, could accelerate the implementation of the Green Deal .

However, some issues remain unresolved. In particular, the size of the new European Competitiveness Fund , which will support key sectors such as cleantech manufacturing, electricity grids, storage, and industrial decarbonization, raises concerns. The fund, financed in part through the Innovation Fund and the Horizon Europe program, will have a total budget of €410 billion, of which only €67.4 billion has been allocated to the first "window," which includes numerous priorities, from renewables to building renovation.

This figure risks proving insufficient. Suffice it to say that, according to European estimates, approximately €67 billion would be needed annually just to modernize distribution networks. The fragmentation of funds and the lack of clear allocation criteria raise questions among operators: how can industrial investment be attracted without providing certainty about the timing, methods, and amount of funding?

Furthermore, bundling disparate sectors within the same financial instruments risks weakening the effectiveness of interventions . Storage technologies, smart grids, and renewables find themselves sharing resources with sectors such as heavy industry or building renovation, in a framework that doesn't help define clear priorities.

The new EU budget is structured around three main pillars: national and regional partnerships (€865 billion), which include agricultural and cohesion funds; the aforementioned Competitiveness Fund (€410 billion); and "Global Europe" (€200 billion), intended for relations with third countries. Resources for energy, education, and the media remain outside the first two pillars, and will be allocated a separate space.

The next stages of negotiations will be crucial to clarify how resources will actually be distributed and whether the new financial architecture will truly meet the challenges posed by the energy transition.