Fossil fuel opponents have based their policies on the hope that ‘green’ energy will someday become reliable and affordable.
The election of Donald Trump highlights a great divide in the energy paths chosen by the U.S., China, and the EU, the three great powers that together account for over half the world’s GDP. The U.S. now joins China in the pursuit of low-cost energy dominated by fossil fuels, while the EU is doubling down on its belief that its climate-policy-driven energy transition to wind, solar, and batteries (together with a revived nuclear sector) will soon lead to lower-cost energy. It’s worth thinking about the underlying realities of this divide.
While it’s no mystery that climate-centric motivations drive the EU’s policy choices, it is indisputable that energy inflation in Europe is rampant and that the trends are destructive, economically, socially, and politically. The 2024 Draghi report, undertaken for the European Commission, as well as a constant stream of news stories, have made clear the consequences of high-cost energy for the continent’s competitiveness, and the looming potential for further deindustrialization.
No policymaker disputes the importance and criticality of reliable, affordable energy supplies. That’s not where we find the difference in energy philosophies. Policymakers everywhere are well attuned to all manner of polls that show what citizens worry about. One recent survey across 29 countries reveals, unsurprisingly, that economic issues constitute four of the top five issues that citizens overwhelmingly rate as “the most worrying.” The fifth is crime, which also correlates with economic deprivation. Climate is not in the top five.
Soaring industrial and residential electricity prices across Europe have created a staggering competitive disadvantage. That’s not just a problem for European manufacturers trying to compete with China to produce solar panels, wind turbines, or EV batteries. It’s also a problem for fueling future technologies ranging from artificial intelligence (AI) to pharmaceuticals. While all eyes are on AI in recent months, it bears noting the global ecosystem of health care and life sciences uses nearly twice as much energy as global aviation, and most of the energy used in health care is found in upstream manufacturing and transportation. Energy costs matter there, too.
It’s impossible to hide the fact that the promised low-cost “energy transition” isn’t happening. (And neither is any reduction in global CO2 emissions.) Indeed, the opposite appears to be the case. While the staggering escalation in Europe’s energy costs was amplified by Russia’s invasion of Ukraine, the trend cannot be explained away that simplistically. The acceleration of the energy disadvantage of the EU compared with the U.S. and China began years before the invasion, and can be attributed, in large part to climate policies.
The great divide in energy philosophies arises from the belief that the anti–fossil fuel path would eventually — maybe even soon — be cheaper. The belief that low-cost electricity from episodic solar and wind would become reliable while also remaining cheap turned out to be wrong.
Nonetheless, a central recommendation of last year’s Draghi report was to double down on the energy transition to wind, solar, and batteries in order to speed up the “decoupling” of European economies from the vicissitudes of fossil fuel prices. And a new 2025 analysis from Bruegel, the respected European economic think tank, epitomizes the EU’s philosophy by calling for the acceleration of that transition. That report asks whether the transition will “lead to cheaper European electricity” and offers in answer that there “are reasons to believe it will” and that “solar could be the cheapest source of electricity everywhere on the globe” (emphases added). There is a lot to take on faith.
Of course, such beliefs are founded in the reasonable expectation of inevitable technology progress. Solar, wind, and battery hardware has improved with economies of scale, as do all technologies, including those involved in fossil fuels. But the pace of such progress has some degree of predictability, notwithstanding “wild cards.” And it’s now clear that the rate of improvement in transition technologies has slowed, as they are now at the scale and maturity of conventional technologies.
We are often reminded that, in democracies, “elections have consequences.” The political landscapes in Europe and the U.S. are in flux. In the current political tumult, it’s no longer possible to hide the disconnect between expensive energy policies and what polls show people are worried about.
Put differently, policies anchored in the beliefs that try to bend physics and economic realities are colliding with an immutable principle: Low-cost energy matters.
Mark P. Mills is the executive director of the National Center for Energy Analytics. Scott W. Tinker is the chairman of the Switch Alliance and a co-author, with Mills, of “Energy for the 21st Century: A Declaration of Guiding Principles,” released at London’s 2025 Alliance for Responsible Citizenship conference.