Frank Elderson: The green transition - benefits and barriers
Keynote speech by Mr Frank Elderson, Member of the Executive Board of the European Central Bank and Vice-Chair of the Supervisory Board of the European Central Bank, at the 7th World Congress of Environmental and Resource Economists, Lisbon, 2 July 2026.
Frank Elderson, a member of the Executive Board of the European Central Bank and Vice-Chair of the Supervisory Board, addressed the 7th World Congress of Environmental and Resource Economists in Lisbon on July 2, 2026. He discussed two factors contributing to inflation volatility and economic uncertainty in the euro area: the war in the Middle East and risks from the climate and nature crises. Both issues stem from the continued overdependence on burning fossil fuels, particularly imported ones in Europe.
Elderson argued that accelerating the transition to net zero carbon emissions can help shield Europe from these shocks. However, he recognized that simplifying the task to "killing two birds with one stone" is misleading. Transitioning to net zero carbon requires a diverse set of policies to ensure a smooth and cost-effective delivery.
While the energy crisis triggered by the Middle East war has been less severe than the one caused by Russia's invasion of Ukraine, it has still led to rising oil prices, threatened product supplies, and increased economic uncertainty.
Europe's dependence on imported fossil fuels makes it particularly susceptible to such events, underscoring the urgency of implementing a comprehensive set of policies to address the climate and nature crises.
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