Brussels, 17 July
The EU spent an extra €50 billion on fossil fuel imports in just 111 days during the 2026 Middle East crisis. The Commission’s Electrification Action Plan (EAP) shows a strong will to change this. By establishing direct electrification as the route to higher competitiveness, security of supply, lower energy prices, and the long-term substitute for fossil fuels, the Plan sets a clear direction to lower our import bill for good.
Yet, this urgent need for energy independence stands in stark contrast to the hesitation surrounding the EU’s long-term targets. While the mention of a 46% electrification target for 2040 is a vital signal, the fact that it is merely being put forward for an impact assessment is disappointing. By conditioning the target on a future Commission study, the EU is delaying the firm commitment we need right now. While a 46% target itself must become a cornerstone of progress, treating it as an open question to be analysed rather than a locked-in mandate dilutes its immediate impact. For industry players, investors, and operators to have true long-term certainty, this assessment must not become a stalling tactic; it must swiftly translate into a concrete baseline.
Further elements stand out:
- Financial support: The establishment of the €100 billion Decarbonisation Bank, including the 30 billion ETS Investment Booster, complemented by a second industrial heat auction under the Innovation Fund in 2026, gives industries further support to electrify.
- Correction of the price ratio: Putting a hard cap KPI on the electricity to fossil fuels price ratio by 2030 forces a structural fiscal rehaul. It will require Member States to shift non-grid levies off electricity bills and onto general taxation or fossil fuels. Paired with a strict Q4 2026 timeline to phase out fossil subsidies, this actively destroys the business case for fossil-fuelled alternatives.
- VAT cuts on clean tech: Under a Green VAT initiative, the Commission plans to guide Member States to reduce VAT on EVs, heat pumps, household batteries and industrial electrification equipment. VAT is one of the levers that changes a consumer’s decision at the exact moment it matters.
“You can’t tax heat pumps like a luxury and expect people to buy them. The Electrification Action Plan acknowledges it. It’s a good diagnosis” said Adrian Hiel, Director of the Electrification Alliance
“The EU just told the market where it’s going, and with what (electricity). That’s worth celebrating, but a milestone is a checkpoint, not a finish line. The worst thing we could do now is get cold feet. We need concrete steps in the revision of the energy security package and the post 2030 energy package, without backpedalling, and without reopening what’s already been agreed. Forward is the only direction that eliminates the threat of more energy crises for good” finished Adrian Hiel
No plan is good without implementation. The EAP’s ambition will mean nothing without a clear pipeline of legislative proposals to turn these commitments into law. The Electrification Alliance stands ready to work with the Commission to follow up with concrete legislative proposals, and with Member States to pull national levers.