Subject File ENVIRONMENTAL ISSUES: The Importance of Energy in Europe

The Importance of Energy in Europe

In Europe, energy is the fundamental engine that powers every aspect of modern life, from basic survival to global economic competition. Beyond just "keeping the lights on," energy is essential for three primary reasons: functional daily life, economic stability, and strategic autonomy

Courtesy of: https://ourfuture.energy/cop26/the-energy-transition/

What do we use energy for in Europe?

• Transport (31%): Powering cars, vans, trains, and planes to move people and goods.
• Households (27%): Primarily for space heating (which accounts for two-thirds of home energy use), as well as lighting and appliances.
• Industry (25%): Essential for manufacturing, particularly in high-energy sectors like chemicals and petrochemicals.
• Services (13%): Supporting commercial and public services like shops and hospitals.

Further Considerations

Economic Competitiveness

Europe's ability to compete globally depends on affordable and stable energy prices. High energy costs can lead to deindustrialization, where factories close or move to regions with cheaper power.  

• Industry Protection: Predictable energy costs are a "cornerstone of industrial strength," protecting jobs and preventing layoffs in sectors like automotive manufacturing.

• Social Stability: Affordable energy helps prevent energy poverty, which currently affects over 46 million Europeans who struggle to pay for basic heating and cooling. 

Strategic Autonomy and Security

Because Europe has historically been "structurally poor" in domestic oil and gas, it has relied heavily on imports (such as from Russia or the US). This dependency makes the continent vulnerable to:  

• Geopolitical Shocks: Conflicts outside of Europe can cause sudden price spikes or supply disruptions.

• Weaponized Energy: Recent strategies emphasize "energy sovereignty"—building domestic renewable sources (wind, solar) to ensure Europe cannot be pressured by external suppliers.

Electricity Generation (2024-2025)

The way Europe makes its electricity is changing faster than the overall energy mix. By 2024, clean energy sources (renewables + nuclear) accounted for over 70% of total generation. 

• Renewables (48%): Wind (17.5%) is the lead renewable source, followed by Hydropower (13.3%) and Solar (11%). In 2024, solar power overtook coal in the electricity mix for the first time.
• Nuclear (23%): Remains the largest single low-carbon source, especially critical in France (67% of its mix) and Slovakia.
• Fossil Fuels (28%): Consisting of Gas (16%) and Coal (10%), both of which hit historic lows in 2024.

Sources of Energy 

Oil/Crude Oil

• Today's largest oil producers comprise countries/regions such as the USA, the Middle East (Saudi-Arabia, Iraq, Iran, Kuwait, United Arab Emirates, etc.), Russia, Venezuela, and Norway and the United Kingdom in Europe. 
• Most of the oil industry is run by huge multinational corporations such as Saudi Aramco (Saudi Arabia), Exxon Mobile and Chevron (USA), British Petrol and Shell (United Kingdom), PetroChina (China), and ENI (Italy).
• Oil-exporting countries organize in an organisation called OPEC (Organization of Petroleum Exporting Countries), which protects the business interests of the member countries and regulates the oil market.
• Oil is paid for in US dollars, and the price is fixed per barrel.
• Because of it high energy density, oil is a popular natural resource, easy to transport through pipelines, ships or road tankers. 
• Oil is a finite resource, and 'peak oil' is a danger to the world economy as are the many conflicts involving oil-producing countries. 

Courtesy of: https://www.visualcapitalist.com/map-countries-most-oil-reserves/

Natural gas

• As of early 2026, natural gas remains one of the most important energy sources for heating, electricity generation, and industrial manufacturing, accounting for about 25 % of Europe's total energy consumption. 
• Natural gas is used for residential and commercial purposes, mostly space and water heating and cooking. Industrial usage includes high-heat processing e. g. in the steel industry, chemical feedstock such fertilizers and pharmaceuticals, and hydrogen production.
• Electricity generation uses natural gas as 'bridge stock' to in the transition to renewable energy sources because of its flexibility and reliability.
• Most natural gas in Europe is sourced from Norway, United States, North Africa, and Russia.

Coal

• In Europe, coal is mainly used for power generation (brown coal/lignite) and in the heavy industry ('hard coal'), especially in steel making and cement production. 
• As of 2026, coal, however, only accounts for 9,2 % of electricity generation due to its impact on the environment and on global warming and Europe's pronounced Net Zero targets. 
• The biggest coal producers in Europe are Germany, Poland, and Turkey. 
• Several countries have already closed all coal plants (Belgium, Austria, Sweden, Slovakia, etc.) with more to follow in the next couple of years. 

Nuclear Energy

• Nuclear power is produced by splitting heavy atomic nuclei inside the reactor. This creates heat which is used to drive a generator to make electricity. The process of splitting these atoms is known as nuclear fission.
• Due to the danger of accidents, nuclear energy has long been viewed with suspicion in Europe. Further concerns relate to the impossibility to prevent leaks of radioactivity, the issue of transportation of radioactive material as well as the disposal of radioactive waste. 
• However, in recent years, nuclear energy has become a viable option to achieve Net Zero targets in Europe. The cheap and reliable production of nuclear energy is another argument for the use of nuclear energy. And modern technologies and safety standards are far advanced and are considered to make accidents very unlikely.
• Nuclear energy is today considered to be green energy in Europe.

Renewable/'green' energy sources

• In 2026, renewable energy is the dominant force in Europe’s power sector. For the first time in history, renewables (wind, solar, hydro, and biomass) generate more than 50% of the EU’s electricity, officially pushing fossil fuels into a minority role.
• Wind as the largest renewable energy source accounts for some 20 % of all the energy produced, both from offshore wind parks (Norway, United Kingdom, Germany, Denmark) as well as onshore facilities in many other countries.
• Solar with some 12 % has recently overtaken energy production from coal with countries in Southern Europe leading in the implementation of utility-scale farms whereas Northern European countries prefer rooftop solar for households and businesses.
• Hydropower as a stable and more traditional source of energy production is the primary energy resource for countries such as Norway (90%) and Austria (60%).
• Bioenergy from organic matter such as agricultural waste, wood pellets, etc. accounts for about 6%. It is often used in district heating systems, particularly in Central Europe. 

European Leaders in Renewables

Emerging Technologies (The "Next Wave")

To reach 100 % green energy, Europe is heavily investing in emerging technologies such as green hydrogen for heavy industry and shipping, storage in 'grid-scale' batteries of wind and solar energy, and heat pumps to replace gas boilers in homes.