Series: Occasional Papers. 2608.
Author: Mónica Correa-López, Mar Delgado-Téllez and Marta Suárez-Valera
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Abstract
The pandemic and the energy crisis triggered by Russia’s invasion of Ukraine have rapidly reshaped Europe’s energy landscape. EU countries have reduced exposure to high-risk suppliers, improved energy efficiency and increased the share of renewables, leading to declines in primary energy use and emissions. Yet significant vulnerabilities remain, including limited interconnection capacity, insufficient storage development and low electrification levels in key sectors. Meanwhile, wholesale and retail energy prices have become highly volatile, influenced by gas market disruptions, renewable expansion and country-specific factors. These price swings have had a direct impact on competitiveness, particularly in energy-intensive industries. While Spain has recently improved its relative energy cost position compared with several major EU partners, other countries face persistently higher costs, affecting industrial performance and export competitiveness. This paper examines these developments and their implications for supply security, market resilience and the EU’s climate objectives.