Good news and bad from the fourth whole-economy assessment report of the European Climate Neutrality Observatory (ECNO). Its 2026 Flagship Report finds that more than half of the indicators tracked have accelerated since last year’s assessment. Yet overall progress remains too slow, with none of the 13 building blocks assessed fully on track. This leaves the EU exposed to strategic dependencies and worsening climate impacts. The report identifies six key actions to strengthen resilience – from accelerating renewables to advancing circularity – in support of a competitive, climate-neutral economy. 

Drawing on a broad set of indicators and policy analysis, ECNO’s 2026 State of EU Progress to Climate Neutrality report examines progress across the European economy and identifies where stronger implementation could reduce exposure to fossil fuel dependence, supply-chain vulnerabilities, affordability challenges and climate-related risks.

Progress Is Accelerating – But Remains Uneven and Too Slow

Europe’s transition is moving in the right direction, with progress accelerating across more than half of the indicators tracked by ECNO. Nevertheless, advancement remains too uneven and too slow overall. None of the 13 building blocks is yet progressing at the pace required to meet transition goals.

Major bottlenecks remain in electricity grids, energy storage infrastructure and wind power deployment. Electrification across transport, buildings and industry is also progressing too slowly. At the same time, declining cleantech investment, falling public spending on energy and environmental research and development, and delays in scaling up climate-neutral industrial production continue to slow the transition. ECNO also emphasises that climate adaptation should be systematically integrated across all areas of the transition rather than being treated as a separate policy field.

According to ECNO, strategic dependencies, investment gaps, and increasing climate risks continue to undermine Europe's resilience. For this reason, the 2026 report places the resilience of the transition at the centre of its assessment.

Six key actions for a resilient transition

ECNO identifies six priority actions to accelerate the transition towards a climate-neutral and resilient European economy. These include:

• accelerating renewable electricity generation together with grid expansion and system flexibility;
• electrifying transport, buildings and industry;
• providing better targeted public support while phasing-out fossil fuel subsidies;
• strengthening clean technologies and industrial transformation;
• advancing reuse and recovery of materials and products; and
• improving food system resilience.

Together, these actions are intended to reduce Europe's dependence on fossil fuels, critical raw material imports and external supply chains while strengthening competitiveness, energy security and long-term resilience.

About the European Climate Neutrality Observatory (ECNO)

The European Climate Neutrality Observatory (ECNO) provides an annual assessment of the European Union's progress towards climate neutrality. Its methodology combines an indicator-based assessment of 146 indicators across 13 Building Blocks of a climate-neutral society with a systematic analysis of EU policy developments and enabling conditions. This approach allows ECNO to identify progress, policy gaps and priority actions needed to support a climate-neutral, resilient and competitive European economy

Download and further information

Download 2026 Flagship Report

More about the 2026 Flagship Report

Website of the European Climate Neutrality Observatory

Contact at Ecologic Institute

Eike Karola Velten
E-Mail: eike.velten@ecologic.eu