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Significance

Although the exact details of the package remain subject to clarification and amendment, it requires a much broader decarbonisation effort beyond the power sector, as well as public-sector financial commitments to higher-risk energy transition technologies such as hydrogen and carbon capture and storage.

Impacts

Increased renewable energy capacity and wider electrification will highlight lagging investment in electricity grid infrastructure.

Enhanced offshore wind targets and European developers’ desire to enter foreign markets will stretch offshore wind supply chains.

Although increasingly contentious, the role of gas is likely to become more important in terms of European security of energy supply.

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