The year 2025 (which is projected to be the 3rd warmest in the record) is coming to an end so it is time to look into our crystal ball to see what is coming to us in 2026. Exact ebb and flow of climate politics is hard to predict but one thing we know for sure: never mind the politics, climate change will not pause.
The EU will wrangle about the details of the 2040 climate package
This autumn, the EU came together to agree on the 2040 climate target. In 2026, European politicians need to agree on the implementation of climate and energy packages for the next decade. It is easy to predict many difficult debates in Brussels and member state capitals about details of the post-2030 climate package.
The geopolitical competition has fundamentally shifted the old rules of free trade and free competition, bringing industrial policy back forcefully onto the table in Brussels. The focus is now on building lead markets, ‘Made in Europe’ rules, and protecting core European industries.
For Nordic companies, this shift must translate into securing the integrity of the internal market and providing clear European rules and financing, thereby preventing larger member states from solely protecting their own national companies. It should also mean strategically leveraging industrial policy to accelerate decarbonisation and electrification across the continent.
Where are China’s emissions heading?
For the past 18 months, Chinese emissions have remained flat, a direct result of its record clean energy deployment and its emergence as the world's first ‘electrostate’, dominant in electric vehicles, solar energy, and batteries. Despite this progress, China's official climate commitments at COP30 were viewed as lukewarm. Nonetheless, coupled with the recent announcement to expand its carbon pricing system the data is forcing a reckoning. Are Chinese emissions peaking in 2026? Uncertainties remain and it is yet to be seen whether the policies are stringent enough to turn emissions into structural decrease.
The electrification leap: beyond the buzz
We have witnessed the acceleration of clean power deployment globally and even with all the hurdles with emotional responses to electric vehicles, they are now undeniably mainstream. The next frontier is 'the electrification of everything', moving beyond personal mobility to the full industrial process chain and direct electrification of industrial process heat. This colossal new demand (including AI) will place unprecedented stress on the whole power system, where grid capacity and system flexibility are becoming increasingly important factors in the coming years.
CLC's 2026 strategic policy focus in Brussels: priorities in climate and competitiveness
The year 2026 is defined by the decisive shift from broad EU climate policy commitments to detailed legislative implementation. This phase is where the strategic value of the EU's climate ambition needs to be fully realized.
The review of the EU Emissions Trading System (ETS) and definition of the exact role of Article 6 international credits as part of Europe's emission reductions are critically important for EU's climate policy. Maintaining the integrity of EU ETS system and carbon price that incentives decarbonisation is the foremost priority of CLC's work next year.
On competitiveness, the scope and impact of forthcoming packages, from the Industrial Accelerator Act to the Circular Economy Act, a proactive engagement from businesses is essential to secure competitive positioning and ensure these frameworks effectively accelerate the decarbonization necessary for Nordic industry.
