The European Union has made substantial strides towards its climate objectives, notably reducing greenhouse gas (GHG) emissions by over a third since 1990, even amidst economic expansion. However, the EU continues to grapple with increasing threats to its competitiveness due to climate change and environmental degradation, as highlighted in a recent report by the European Environment Agency (EEA).
This publication is part of a series of quinquennial State of Europe’s environment reports released by the EEA, as mandated by the European Commission, to provide a comprehensive evaluation of the environment, climate, and sustainability across Europe.
In 2021, the EU enacted a [Climate Law](https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32021R1119), which legally binds the bloc to achieve climate neutrality by 2050. The legislation also stipulates a binding target to cut net GHG emissions by at least 55% by 2030 compared to 1990 levels. More recently, the EU has pledged to establish a 2035 GHG emissions reduction goal, aiming for a reduction between 66.25% and 72.5%, while the European Commission has proposed a new target to slash emissions by 90% by 2040, currently under discussion among lawmakers.
The report underscores substantial progress towards the EU’s interim climate targets, with GHG emissions dropping by 37% since 1990, despite a 60% increase in GDP during the same timeframe. The pace of annual emissions reductions within the EU has doubled since 2005.
Significant transformations in Europe’s energy mix are identified as pivotal in the EU’s emissions reduction achievements. Since 2005, the share of renewable energy sources has doubled, with almost 25% of final energy usage in 2023 derived from renewables. Currently, 45% of all electricity consumed in the EU is generated from renewable sources, while the use of fossil fuels, particularly coal, has diminished.
Despite advancements in energy transition, the report notes that approximately three-quarters of all EU GHG emissions stem from fossil fuel combustion for energy. Fossil fuels continue to dominate Europe’s energy landscape, accounting for nearly 70% of the EU’s gross available energy use in 2023. This highlights the necessity for further investment to expedite renewable energy deployment, enhance large-scale electrification, and transition industrial processes to cleaner fuels, substituting fossil-based materials with renewable alternatives.
The report also reveals uneven progress in GHG emissions reduction across sectors. While energy supply emissions have decreased by 49% since 2005, and industry emissions by 36%, domestic transport emissions have only reduced by 6%, and agriculture sector emissions by 7%. Although domestic transport emissions reductions are expected to accelerate in the coming years, agriculture emissions are projected to remain nearly unchanged through 2030.
Despite these emissions reduction efforts, the EU faces significant and escalating economic risks from climate change. The report indicates that weather and climate-related events have resulted in losses exceeding €738 billion from 1980 to 2023, with over €162 billion lost in the past three years alone. Climate impacts could potentially reduce EU GDP by 7% by the century’s end, with estimated losses of €2.4 trillion from 2031 to 2050 if global warming surpasses 1.5°C. Sectors with high exposure include agriculture, forestry, mining and quarrying, and construction.
Additionally, the report highlights lagging progress in certain areas, noting the deteriorating state of biodiversity in Europe, with 81% of habitats classified as poor or bad. The short-term outlook for biodiversity is described as “bleak,” with previous ecosystem targets unmet and pressures on ecosystems remaining high.
Executive Vice-President for Clean, Just and Competitive Transition, Teresa Ribera, remarked:
“This report is a stark reminder that Europe must stay the course and even accelerate our climate and environmental ambitions. Recent extreme weather events show how fragile our prosperity and security become when nature is degraded, and climate impacts intensify. Delaying or postponing our climate targets would only increase costs, deepen inequalities, and weaken our resilience. Protecting nature is not a cost. It is an investment in competitiveness, resilience and the well-being of our citizens. By scaling up action now, we can build a cleaner, fairer and more resilient Europe for future generations.”
[Access the full report here](https://www.eea.europa.eu/en/europe-environment-2025/main-report).
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