The European Union (EU) is facing significant challenges: on the one hand, it aims to achieve substantial reductions in emissions, with the Fit-for-55 (FF55) package emerging as a pivotal tool in attaining this ambitious goal; on the other hand, the EU's heavy reliance on fossil fuels, particularly natural gas, where Russia supplies nearly half of the total imports, has intensified the need for decisive action as the conflict with Ukraine persists. This policy brief summarizes two complementary research projects on the above issues.

The first research line assesses the transition pathway outlined in the FF55 package, emphasizing the technical feasibility and social implications of the EU energy system. Employing the Energy System Optimization Model for the European Union (ESOPUS) together with the general equilibrium model FIDELIO, the study offers a detailed representation of the energy system and captures socio-economic impacts across various scenarios, considering both technological and social aspects entailed by the achievement of carbon neutrality by 2050. The analysis reveals distinct regional variations in the EU's electricity generation shares and investments, emphasizing the need for differentiated policy approaches. Turning attention to Italy, the study analyses the socio-economic implications of increased electricity prices on households. Findings indicate a regressive impact, with low-income households bearing a disproportionate burden: changes in electricity consumption shares and consumer surplus underscore the importance of addressing the impact of the future transition on vulnerable populations.

The second research line employs the open software and open database energy system optimization model (ESOM) TEMOA-Europe. It considers different scenarios: one in which Russian fuel imports become unavailable from 2030, in line with the REPowerEU Plan, and another assuming no change in dependence on Russia. Both scenarios adhere to the constraints outlined in the European Green Deal, including greenhouse gas (GHG) emission reduction trajectories, energy service demand projections, and limitations on the supply of primary energy commodities. Results from the analysis reveal a substantial transformation in the total primary energy supply (TPES), displaying a shift towards renewables dominating over 50% of TPES by 2050. The scenarios emphasize the importance of a larger integration of renewable energy sources as a primary driver for a successful transition to net-zero emissions. The study concludes that moving towards cleaner energy sources in the long term requires considerable effort. Suspending fossil fuel imports from Russia is seen as an opportunity to facilitate the transition to a decarbonized energy system, rather than an obstacle.