The founder of the British investment company BCCM Group, co-founder, and board member of the business travel digital platform Tumodo shares how the new environmental regulations of the European Union are changing business.
Back in 2011, when Volkswagen launched a wind power station in Emden, few could have imagined that it would become a symbol of the beginning of a large-scale transformation of European energy and economy. Today, more than 50% of all electricity generation in the EU comes from renewable sources. Not long ago, such numbers seemed unattainable.
Behind this historic achievement lies a radical rethinking of the continent’s industrial strategy. From steel plants in the Ruhr to textile factories in Milan, the traditional sectors of European industry are undergoing perhaps one of the most massive modernizations since the post-war recovery. “All these changes open up unprecedented opportunities for businessmen ready to bet on green technologies,” says Spanish green energy investor Vladimir Kokorin. “But the challenges here are also quite serious.”
From ambitions to reality
“The EU’s green transformation is a response to the global climate challenge and a complex changing geopolitical situation,” believes Vladimir Kokorin. “Despite objective difficulties, Europe’s energy sector demonstrates impressive adaptability. The real results speak for themselves, even though many experts were initially skeptical about the ambitious goals of alternative energy development. It’s important to understand that success in this direction is no accident. It is the result of long-term planning and consistent policies, not a coincidence of circumstances.”
Indeed, wind energy has made a real breakthrough, unexpectedly surpassing natural gas in the EU energy balance and taking second place after nuclear energy. According to WindEurope, in 2023 alone, European companies invested more than 30 billion euros in the development of offshore wind farms in the North Sea, alongside active expansion of onshore installations in Germany, Denmark, and Spain, creating a solid foundation for further industry growth.
Solar energy also demonstrates impressive dynamics. The newly installed capacity of 56 gigawatts in 2023 exceeded the previous record by 40%. This growth is supported by both large industrial projects and the widespread adoption of smaller solar installations.
According to SolarPower Europe, the cost of solar generation has decreased by 75% over the past five years, making technology in this field increasingly attractive to investors. EU analysts predict that by 2030, total investment in renewable energy in the EU will reach 1 trillion euros, creating unprecedented opportunities for investors. “Experts believe, and I fully agree with them, that the key challenge now remains the integration of growing renewable energy capacities into existing energy grids. The further fate of the energy transition largely depends on this,” says Vladimir Kokorin.
The EU changes the rules
The European Union continues to tighten environmental requirements for business. The EU’s new policy, known as the Green Deal, aims to achieve carbon neutrality by 2050 and reduce emissions by 55% by 2030. Special attention is drawn to the Carbon Border Adjustment Mechanism (CBAM), which will come into effect in 2026. “In fact, this mechanism creates new rules of the game in global trade. It forces companies to either pay significant duties or invest in green technologies,” notes Vladimir Kokorin. According to PwC, CBAM could increase carbon costs for some goods by more than five times.
The EU is also introducing a comprehensive set of measures to develop a circular economy, sustainable agriculture, and eco-friendly production. About 55 billion euros have been allocated to support these initiatives.
The new Air Quality Directive, adopted in December 2024, became another turning point in the EU’s environmental policy. The document, which sets the strictest standards for controlling major pollutants, opens up new horizons for investment in green technologies. According to calculations by McKinsey & Company, implementing the updated regulations will require subsidies of 4.9 trillion euros over three decades. However, by 2050, reduced energy consumption will offset the invested funds.
“It is important to understand that small and medium-sized businesses will need significant support to adapt to the new requirements,” says investor Vladimir Kokorin.
Risks and challenges of the green transformation
According to Vladimir Kokorin, a competent assessment of emerging risks in the sector, where energy security issues take center stage, will be decisive in developing effective investment approaches. Industry experts point to a significant gap between the EU’s climate goals and the global energy market situation. According to Bloomberg, even with the active development of alternative energy, Europe’s dependence on gas imports will remain at least until 2027, creating risks of price fluctuations.
Maintaining competitive positions for European manufacturers also becomes particularly relevant. According to a report by former Italian Prime Minister Mario Draghi, the costs of implementing new environmental requirements for small and medium-sized businesses account for up to 12.5% of total investments. In the absence of similar requirements for Asian manufacturers, European companies risk losing their positions in global markets.
The social dimension also deserves close attention. ECB research shows that the green transformation could contribute to inflationary pressure. This creates potential for increased social tension and opposition to environmental initiatives, especially in regions with low levels of welfare.
Nevertheless, the expert community views these risks as surmountable with a competent investment approach. “Any large-scale transformation inevitably involves risks. The current situation requires businesspeople to be particularly cautious. It is important to remember that risks are not an obstacle to investment but a factor requiring competent management,” emphasises Vladimir Kokorin.
“The European green transition is an unprecedented experiment in restructuring one of the world’s largest economies on sustainable principles. The key to success here is the ability of companies to adapt to new conditions and find innovative solutions,” notes the Spanish investor. “Market leaders are already demonstrating how environmental challenges can be turned into competitive advantages. From wind energy to green metallurgy, European companies prove that sustainable development and commercial success are not only compatible but mutually reinforce each other.”
