BRUSSELS ― Two wars on Europe’s doorstep loomed over a 12-hour summit of EU leaders ― and for very different reasons they found themselves paralyzed rather than able to do much about either. Rarely has the bloc’s inability to take a lead on international affairs been so obvious. Between Germany’s Friedrich Merz, France’s Emmanuel Macron and Italy’s Giorgia Meloni ― heads of three of the world’s top 10 economies ― and the other 24 in attendance, they could only look the other way, squabble with each other, or offer little but words as the bombing, missile-firing and killing continued. “In these very troubled moments in which we are living, more than ever it’s decisive to uphold the international rules-based order,” European Council President  António Costa, who chaired the gathering in Brussels, told reporters. “The alternative is chaos. The alternative is the war in Ukraine. The alternative is the war in the Middle East.” And that speech was about as far as it went. As Tehran pounded its neighbors, disrupting Europe’s energy supplies, Kyiv attacked Russian factories repairing military planes, and Donald Trump in Washington joked about the Pearl Harbor attack alongside the Japanese prime minister, European leaders used their talks to tinker with the bloc’s carbon permit scheme, the Emissions Trading System. It’s not a wholly unrelated matter to the global energy shock, but hardly an issue where the continent could demonstrate its geopolitical might. On Iran, leaders found they had little leverage or will to make any significant intervention. On Ukraine, more than four years after Russia’s full-scale invasion ― a conflict where they do have leverage and they do have will ― they were unable to overcome internal divisions to approve sending €90 billion Kyiv’s way. There was “no willingness to get involved across the table” on the Iran conflict, said a senior European government official, granted anonymity like others quoted in this article to discuss the talks behind closed doors. German Chancellor Merz even complained that focusing on Iran risked shifting attention away from measures to boost Europe’s flagging economy — the summit’s original raison d’être before would affairs got in the way — according to three officials. “The world looked very different at Alden Biesen,” an EU official said, referring to last month’s competitiveness-focused meeting in a Belgian castle that was meant to set the stage for this summit. That was before Iran’s war and Ukraine’s funding dilemma, brought about by Hungarian Prime Minister Viktor Orbán going back on his promise to approve the loan, radically reshaped the agenda. NOT OUR WAR That’s not to say Iran was ignored completely. There was some renewed discussion about sending French warships to protect the Strait of Hormuz, the vital oil transit point that Tehran has effectively shut down by threatening to strike ships, potentially with backing from the U.N. Security Council. “We have begun an exploratory process, and we will see in the coming days if it has a chance of succeeding,” Macron said. But the summit’s final statement stopped short of pledging any new mission, referring only to strengthening existing EU naval operations in the region. Italian Prime Minister Giorgia Meloni at a press conference at the end of the European Council summit on March 19, 2026 in Brussels. | Pier Marco Tacca/Getty Images By the end of the talks, the EU’s leaders reached a sobering conclusion: Europe has little power or inclination to shape events. “Middle East impacts us a lot — but are we a player in the game?” an EU official who was party to the leaders’ discussions asked. “They’re trying to find a place in this debate and we have a lot of statements and positions [but] is there a role for Europeans for solving this process?” Evidently not, according to Kaja Kallas, the EU’s foreign policy chief, who warned leaders that “starting war is like a love affair — it’s easy to get in and difficult to get out,” according to two diplomats briefed on her remarks. Translation: This is not Europe’s war — and it’s not going to be. The EU was left with doing “what we always do,” an EU official said, writing “nice statements.” BURNING GAS FIELDS Europe already angered U.S. President Trump earlier this week when its top envoys rejected his call to secure the Strait of Hormuz. The summit’s final conclusions leaned heavily on familiar calls for “de-escalation” and “restraint,” without proposing concrete action, sticking to that earlier position. That’s despite Qatar warning Thursday it would not be able to fulfill its liquefied natural gas contracts with Belgium and Italy after Iran directed its wrath — and its ballistic missiles — over U.S.-Israeli strikes at the Gulf country, knocking out almost a fifth of its LNG export capacity. Yet rather than grapple head-on with the rapidly expanding energy shock, Europe’s leaders spent hours debating the bloc’s climate policy, including its ETS, which a group of countries are eager to reform. “To say ETS is the biggest issue when big gas fields are burning is a bit weird,” an EU official said. European Commission President Ursula von der Leyen said the consequences of the war extended far beyond the Middle East, adding its most “immediate impact” was on energy supply and prices. She announced a slate of emergency measures to lower costs, from lowering taxes to boosting investment in ETS. ‘JUST CRAZY’ If anything, the summit exposed where the wars in Iran and Ukraine overlap. In what could be his final EU gathering after 16 years if he loses next month’s election, Hungary’s Orbán slammed Europe’s approach to the unfolding energy crisis. “The behavior and the strategy that the Europeans have here is just crazy,” he said — adding the EU needed to buy Russian oil to “survive.” Orbán has blocked a €90 billion EU loan to Kyiv because of a dispute about a damaged pipeline carrying Russian oil through Ukraine to Hungary and other central European countries. For that reason, the bloc was similarly unable to offer much more than assurances on the Ukraine war either. Orbán maintained his opposition on Thursday and even won the sympathy of Meloni, who told leaders she understood his position. As frustration inside the room boiled over, many leaders sharply criticized the Hungarian premier, according to Swedish Prime Minister Ulf Kristersson. “I have never heard such hard-hitting criticism of anyone, ever,” he told reporters during a break in the talks. Merz concurred that leaders were “deeply upset” at Orbán. “I am firmly convinced that this will leave a lasting mark,” he said. But the pressure from his peers failed to sway Orbán and questions of the EU loan will roll on to another summit next month ― by which time Hungary could have a new leader, or at least an old one not desperate for votes. On Iran and on Ukraine, the EU didn’t get anywhere. Earlier predictions by diplomats that leaders might continue discussions through the night or even reconvene for a second day as the urgency of a world in turmoil forced them to face up to the challenges before them failed to materialize. Things were done and dusted before midnight. After 12 hours of few decisions, leaders were left with little new to tell people back home. “There are many things worrying about this war” in the Middle East, while Orban’s veto of the loan to Kyiv “is still there and we are extremely unhappy about this, and so of course is Ukraine,” Sweden’s Kristersson told reporters upon leaving the summit. And that was that. Zoya Sheftalovich, Nette Nöstlinger, Nicholas Vinocur, Gerardo Fortuna, Gabriel Gavin, Hans von der Burchard, Sonja Rijnen, Zia Weise, Seb Starcevic, Giorgio Leali, Hanne Cokelaere, Ferdinand Knapp, Milena Wälde, Aude van den Hove, Gregorio Sorgi, Koen Verhelst, Victor Jack, Ben Munster, Jacopo Barigazzi and Bartosz Brzezińksi contributed reporting.

BRUSSELS — EU leaders were supposed to spend Thursday mapping out how to boost Europe’s economy. Instead, they were left scrambling to deal with two wars, a deepening transatlantic rift and a standoff over Ukraine. Twelve hours of talks, a few showdowns and many, many coffees later, here’s POLITICO’s rapid round-up of what we learned at the European Council. 1) Viktor Orbán’s not a man for moving … The most pressing question ahead of this summit was whether Hungary’s prime minister could be convinced to drop his veto to the EU’s €90 billion loan for Ukraine. He wasn’t. The European Commission had attempted to appease Orbán in the days running up to the summit by sending a mission of experts to Ukraine to inspect the damaged Druzhba pipeline, which supplies Russian oil to Hungary and Slovakia. Orbán has argued that Ukraine is deliberately not addressing the issue, and tied that to his blocking of the cash. Asked whether he saw any chance for progress on the loan going into the summit, Orbán’s response was simple: “No.” Twelve hours later, that answer was much the same. 2) … But he does like to stretch his legs. In one of the most striking images to have come out of Thursday’s summit, the Hungarian prime minister stands on the sidelines of the outer circle of the room while the rest of the leaders are in their usual spots listening to a virtual address from Ukrainian leader Volodymyr Zelenskyy. Ukraine’s President Volodymyr Zelenskyy (on screen) speaks to EU leaders via video at the European Council summit in Brussels, March 19, 2026. | Pool photo by Geert Vanden Wijngaert/OL / AFP via Getty Images The relationship between the two has descended into outright acrimony after the Hungarian leader refused to back the EU loan and the Ukrainian leader made veiled threats — which even drew the (rare) rebuke of the Commission. Faced with Zelenskyy’s address, the Hungarian decided to vote with his feet. 3) The new kid on the block is happy to be a part of this European family, dysfunctional as it may be. This was the first leaders’ summit for Rob Jetten, the Netherland’s newly-installed prime minister. Ahead of the meeting, he said he was “very much looking forward to being part of this family.” His verdict after the talks? That leaders differ greatly in their speaking style, with some quite efficient while others take longer to get to the point — but he welcomed the jokes of Belgian’s Bart De Wever, “especially when the meeting has been going on for hours.” 5) Though not everyone was so charitable. Broadly speaking, Orbán digging in his heels did not go down well. Sweden’s prime minister told reporters after the summit that leaders’ criticism of the Hungarian in the room was “very, very harsh,” and like nothing he’d ever heard at an EU summit. Jetten said the vibe in the room with EU leaders was “icy” at points, with “awkward silences.”  6) The EU’s not giving up on the loan. Despite murmurs ahead of the talks of a plan B in the works, multiple EU leaders as well as Costa and Commission chief Ursula von der Leyen were adamant that the loan was the only way to go — and that it will happen, eventually. “We will deliver one way or the other … Today, we have strengthened our resolve,” von der Leyen. Costa added: “Nobody can blackmail the European Council, no one can blackmail the European Union.” Top EU diplomat Kaja Kallas arrives at the European Council summit on March 19, 2026. | Pier Marco Tacca/Getty Images 7) Kaja Kallas wants to avoid a messy entanglement. In her address to the bloc’s leaders, Kallas, the EU’s top diplomat, stressed the importance of not getting caught up in the conflict in the Middle East. “Starting war is like a love affair — it’s easy to get in and difficult to get out,” she said, according to two diplomats briefed by leaders on the closed-door talks. At the same time, Kallas reiterated the importance of the EU’s defending its interests in the region but said there was little appetite for expanding the remit of its Aspides naval mission, currently operating in the Red Sea. 8) But it was all roses with the U.N. U.N. Secretary-General António Guterres joined the Council for lunch, thanking them for their “strong support for multilateralism and international law.” In an an exclusive interview with POLITICO on the sidelines of the summit, Guterres applauded the restraint shown by the Europeans, despite Donald Trump’s anger at their refusal to actively support the war or help reopen the Strait of Hormuz, a critical maritime artery that Iran has largely sealed off, driving up global energy prices. 9) Kinda. One senior EU official told POLITICO that the lunch meeting was “unnecessary.” “With all appreciation for multilateralism and its importance … considering the role the U.N. is not playing in international crises right now, it is unnecessary,” said the official, granted anonymity to speak freely. 10) Celery is a very versatile vegetable. Also on the table while they picked over the future of the multilateral world order was a pâté en croûte with spring vegetables and fillet of veal with celery three ways. Three ways! And for dessert? A mandarin tartlet with cinnamon. 11) Cyprus and Greece want the EU to get serious about mutual defense. Cypriot President Nikos Christodoulides and Greek Prime Minister Kyriakos Mitsotakis asked the EU to think about a roadmap for acting on the bloc’s mutual defense clause, according to two EU diplomats and one senior European government official. The clause, Article 42.7, is the EU’s equivalent of NATO’s Article 5. Its existence and potential use has recently come into focus since British bases in Cyprus were attacked by drones. 12) And the Commission hopes it’s already got serious enough about migration. Von der Leyen said that while the EU has not yet experienced an increase in migrants as a result of the conflict in Iran, the bloc should be prepared. “There is absolutely no appetite … to repeat the situation of 2015 in the event of large migration flows resulting from the conflict in the Middle East,” said one national official. The Commission chief emphasized that the mistakes of the 2015 refugee crisis won’t happen again. 13) Von der Leyen likes to cross her Ts.   Speaking of emphasis — “temporary, tailored and targeted” was how von der Leyen described the EU’s short-term actions to minimize the impact on Europe of the recent energy price spikes after the U.S.-Israeli strikes on Iran. The moves will impact four components that affect energy prices: energy costs, grid charges, taxes and levies and carbon pricing, she said. 14) The ETS is here to stay — with some modifications. While EU leaders agreed to make some adjustments to the Emissions Trading System — the bloc’s carbon market — most forcefully backed the continuation of the system itself. “This ETS is a great success. It has been in place for 20 years and is a market-based and technology-neutral system. So we are not calling the ETS into question,” German Chancellor Friedrich Merz told reporters after the talks had concluded. While the Commission will propose some adjustments to the ETS by July, these are merely adjustments, not fundamental changes, the German leader said. In the run-up to the summit, some EU countries, including Italy, floated the idea of weakening the ETS to help weather soaring energy prices. 15) No matter what, EU leaders want to get home — ASAP. While Costa has so far ensured every European Council under his watch lasts only one day instead of the once-customary two, this time around, that goal was looking optimistic. However, at the end of the day, leaders’ dogged determination to get out of there prevailed (even if that meant kicking a discussion on the long-term budget to April). À bientôt!

When Italy’s Prime Minister Giorgia Meloni attended her first European leaders’ summit in Brussels in December 2022, few would have expected her to become one of the most effective politicians sitting around the table four years later.   In fact, few would have expected that she’d still be there at all, as Italian leaders are famously short-lived. Remarkably, her right-wing Brothers of Italy party looks as rock solid in polls as it did four years ago, and she now has her eye on the record longest term for an Italian premier — a feat she is due to accomplish in September. A loss in what is set to be a nail-biting referendum on the bitter and complex issue of judicial reform on March 22 and 23 would be her first major set back — and would puncture the air of political invincibility that she exudes not only in Rome but also in Brussels. Meloni has thrived on the European stage, and has become adept at using the EU machinery to her advantage. Only in recent months, she has made decisive interventions on the EU’s biggest dossiers, such as Russian assets, the Mercosur trade deal and carbon markets, leveraging Italy’s heavyweight status to win concessions in areas like farm subsidies. Profiting from France’s weakness, Meloni is also establishing a strong partnership with German Chancellor Friedrich Merz — a double act between the EU’s No. 1 and No. 3 economies — to mold the bloc’s policies to favor manufacturing and free trade. CRASHING DOWN TO EARTH For a few more days, at least, Meloni looks like a uniquely stable and influential Italian leader. Nicola Procaccini, a Brothers of Italy MEP very close to Meloni and co-chair of the European Conservatives and Reformists (ECR) group, called the government’s longevity a “real novelty” in the European political landscape. “Until recently, Italy couldn’t insert itself into the dynamics of those that shape the European Union — essentially the Franco-German axis — because it lacked governments capable of lasting even a year,” said the MEP. “Giorgia Meloni is not just a leader who endures; she is a leader who shapes decisions and influences the direction to be taken.” But critics of the prime minister said a failure in the referendum would mark a critical turning point. Her rivals would finally detect a chink in her armor and move to attack her record, particularly on economic weaknesses at home. The unexpected, new message to other EU leaders would be clear: She won’t be here for ever. Brando Benifei, an MEP in Italy’s center-left opposition Democratic Party, conceded that other EU leaders saw her as the leader of a “ultra-stable government.” But, if she were to lose the referendum, he argued “she would inevitably lose that aura.” “Everyone remembers how it ended for Renzi’s coalition after he lost his referendum,” Benifei added, in reference to former Democratic Party Prime Minister Matteo Renzi who resigned after his own failed referendum in 2016. MACHIAVELLIAN MELONI Meloni owes much of her success on the EU stage to canny opportunism. At the beginning of the year, she slyly spotted an opportunity — suddenly wavering on the Mercosur trade deal, which Rome has long supported — to win extra cash for farmers that would please her powerful farm unions at home. She held off from actually killing the agreement, something that would have lost her friends among other capitals. German Chancellor Friedrich Merz and Italy’s Prime Minister Giorgia Meloni at a signing ceremony during an Italy-Germany Intergovernmental Summit in Rome on Jan. 23, 2026. | Pool photo by Michael Kappeler/AFP via Getty Images The Italian leader “knows how to read the room very well,” said one European diplomat, who was granted anonymity to discuss European Council dynamics.   Teresa Coratella, deputy head of the Rome office at the think tank European Council on Foreign Relations, said Meloni had  “a political cunning” that allowed her to build “variable geometries,” allying with different European leaders by turn based on the subject under discussion. One of her first victories came on migration in 2023. She was able to elevate the issue to the top level of the European Council, and even managed to secure a visit by European Commission President Ursula von der Leyen to Tunisia, eventually resulting in the signing of a pact on the issue. Others wins followed.  Last December, with impeccable timing, Meloni unexpectedly threw her lot in with Belgium’s Prime Minister Bart De Wever at the last minute, scuppering a plan to fund Ukraine’s defenses with Russian frozen assets, instead pushing for more EU joint debt. Italian diplomats said that Meloni is a careful student, showing up to summits always having read the relevant documents, and having asking the apposite questions. That wasn’t always the case with former Italian prime ministers.  They said her choice of functionaries — rewarding competence over and above political affiliation — also helps. These include her chief diplomatic consigliere Fabrizio Saggio and Vincenzo Celeste, ambassador to the EU. Neither is considered close politically to Meloni.   Her biggest coup, though, has been shunting aside France as Germany’s main European partner on key files, with her partnership with Merz even being dubbed “Merzoni.” ROLLING THE DICE Meloni’s strength partly explains why she dared call the referendum. Italy’s right has for decades complained that the judiciary is biased to the left. It’s a feud that goes back to the Mani Pulite (Clean Hands) anti-corruption drive in the 1990s that pulverized the political elite of that time, and the constant court cases against playboy premier and media tycoon Silvio Berlusconi, father of the modern center-right. The proposal in the plebiscite is to restructure the judiciary. But it’s a high-stakes gamble, and why she called it seems something of a puzzle. The reforms themselves are highly technical — and by the government’s own admission won’t actually speed up Italy’s notoriously long court cases.    Prime Minister of Italy, Giorgia Meloni attends the European Council meeting on June 26, 2025 in Brussels. | Pier Marco Tacca/Getty Images Instead, the vote has turned into a more general vote of confidence in Meloni and her government. The timing is tough as Italians widely dislike her ally U.S. President Donald Trump and fear the war in Iran will drive up their already high power prices. Still, she is determined not to suffer Renzi’s fate and insists she will not step down even if she loses the referendum.  Asked at a conference on Thursday whether a loss would make Rome appear less stable in its dealings with other European capitals, Foreign Minister Antonio Tajani was adamant that the referendum has “absolutely nothing to do with the stability of the government.” “This government will last until the day of the next national elections,” he added. A victory on Monday will put the wind in her sails before the next general elections, which have to be held by the end of 2027. It would also set the stage for other reforms that Meloni wants to enact: a move to a more presidential system, with a direct election of the prime minister, making the role more like the French presidency.  But a loss would galvanize the opposition — split between the populist 5Star Movement, and the traditional center-left Democratic Party. The danger is her rivals would round on her particularly over the economy. Even counting for the fact Italy has benefitted from the largest tranche of the Covid-era recovery package — growth has been sluggish, consistently below 1 percent, falling to 0.5 percent in 2025.  “We have a situation in which the country is increasingly heading toward stagnation and we have to ask ourselves what would have happened if we had not had the boost of the Recovery Fund,” said Enrico Borghi, a senator from Italia Viva, Renzi’s party. Procaccini, however, defended her, both on employment and growth. “It could be better,” he conceded. “But we are still talking about growth, unlike countries that in this historical phase are recording a decline, as in the case of Germany.”

BUDAPEST — If Brussels claws back €10 billion of EU funds controversially disbursed to Hungary, it will also have to recover as much as €137 billion from Poland too, Budapest’s EU affairs minister told POLITICO. The European Commission made a highly contentious decision in December 2023 to free up €10 billion of EU funds to Hungary that had been frozen because of weaknesses on rule of law deficiencies and backsliding on judicial independence. Members of the European Parliament condemned what looked like a political decision, offering a sweetener to Prime Minister Viktor Orbán just before a key summit where the EU needed his support for Ukraine aid. On Feb. 12, Court of Justice of the European Union Advocate General Tamara Ćapeta recommended annulling the decision, meaning Hungary may have to return the funds if the court follows in its final ruling in the coming months. Orbán has slammed the idea of a repayment as “absurd.” János Bóka, Hungary’s EU affairs minister, told POLITICO that clawing back the €10 billion from the euroskeptic government in Budapest would mean that Brussels should also be recovering cash from Poland, led by pro-EU Prime Minister Donald Tusk. “We believe that the Commission’s decision was lawful … the opinion, I think, it’s legally excessive,” Bóka said. He warned that “if the Advocate General’s opinion is followed then the Commission would be legally required to freeze all the EU money going to Poland as well, which I think in any case the Commission is not willing to do.” The legal opinion on Hungary states the the Commission was wrong in unfreezing the funds “before the required legislative reforms had entered into force or were being applied,” Ćapeta said in February. Bóka said that would seem to describe the situation in Poland too. In February 2024, the EU executive released €137 billion in frozen funds to Tusk’s government in exchange for promised judicial reforms. But these have since been blocked by President Karol Nawrocki as tensions between the two worsen — spelling trouble for Poland’s continued access to EU cash. “It’s very easy to get the EU funds if they want to give it to you, as we could see in the case of Poland, where they could get the funds with a page-and-a-half action plan, which is still not implemented because of legislative difficulty,” Bóka said. Fundamentally, that is why Bóka said he believed “the court will not issue any judgment that would put Poland in a difficult position.” Bóka risks leaving office with Orbán after the April 12 election, with opposition leader Péter Magyar leading in the polls on a platform of unlocking EU funds, tackling corruption, and improving healthcare and education. The Commission is, separately, withholding another €18 billion of Hungarian funds — €7.6 billion in cohesion funds and €10.4 billion from the coronavirus recovery package. “I think Péter Magyar is right when he says that the Commission wants to give this money to them … in exchange, like they did in the case of Poland, they want alignment in key policy areas,” he said, “like support for Ukraine, green-lighting progress in Ukraine’s accession process, decoupling from Russian oil and gas, and implementing the Migration Pact.” “Just like in the case of Poland, they might allow rhetorical deviation from the line, but in key areas, they want alignment and compliance.” Poland’s Tusk has been vocal against EU laws, such as the migration pact and carbon emission reduction laws. Bóka also accused the Commission of deciding “not to engage in meaningful discussions [on EU funds] as the elections drew closer.” He added that if Orbán’s Fidesz were to win the election, “neither us nor the Commission will have any other choice than to sit down and discuss how we can make progress in this process.” Legal experts are cautious about assessing the potential impact of such a ruling, noting that the funds for Poland and Hungary were frozen under different legal frameworks. However, there is broad agreement that the case is likely to set some form of precedent over how the Commission handles disbursements of EU funds to its members. If the legal opinion is followed, “there could be a strong case against disbursing funds against Poland,” said Jacob Öberg, EU law professor at University of Southern Denmark. He said, however, that it is not certain the court will follow Ćapeta’s opinion because the cases assess different national contexts. Paul Dermine, EU law professor at the Université Libre de Bruxelles agreed the court ruling could “at least in theory, have repercussions on what happened in the Polish case,” but said that he thought judges would follow the legal opinion “as the wrongdoings of the Commission in the Hungarian case are quite blatant.”

LONDON — The U.K. government is expected to publish a long-awaited plan to decarbonize new homes next week, with ministers set to mandate low-carbon heating for all new-builds and solar panels on the vast majority. According to two energy sector figures briefed on the plan, the government will publish the Future Homes Standard next week. Both were granted anonymity to discuss behind-closed-doors briefings from government. One of the energy sector figures said the plan was expected Tuesday. The strategy — which has been subject to years of consultation — will likely be presented as an essential step to reduce U.K. reliance on fossil fuels and to cut energy bills in the context of the Iran war and the resulting surge in oil and gas prices, they added. “We’re expecting it to confirm that all new homes will have heat pumps or connections to low-carbon heat networks,” the person said, “and the vast majority of new homes will have solar.” The policies are in line with expectations, and the timing of the publication suggests the government is using the Middle East energy crisis to double down on green plans at home. A third energy sector figure, also granted anonymity to speak candidly, said they had expected plans for publication to be “accelerated” after Energy Secretary Ed Miliband said on Sunday the government would go “further and faster” in pursuit of clean energy and electrification. The Future Homes Standard, first planned under the previous Conservative government, has been beset by delays and lobbying by house builders concerned that some of its measures could push up costs or prove impractical. But the third energy sector figure added: “It looks like the crisis has shut up the volume house-builder lobbyists.” An official at the Ministry of Housing, Communities and Local Government said the FHS will mean new homes need “no future retrofitting to meet net zero” and will contribute to bringing down bills.

BRUSSELS — The European Commission will look into loosening state aid rules and capping the price of gas to help member countries deal with the energy crisis triggered by the Iran war, according to a letter sent by Commission President Ursula von der Leyen. The letter, dated March 16 and obtained by POLITICO, singles out a number of main ways countries could combat higher energy costs, which have risen sharply as a result of the U.S.-Iraeli war with Iran. The letter comes ahead of a meeting of European leaders in Brussels on Thursday. Since the war broke out last month, effectively shutting off the Strait of Hormuz through which a fifth of the world’s oil supply transits, EU countries have been debating a broad range of responses to a looming energy crunch. Proposed measures have ranged from the modest and technical, such as relaxing rules to allow governments to compensate households and businesses for rising energy costs; to the radical and controversial, such as scrapping the EU’s most important climate laws. One option proposed in Monday’s letter is to relax state aid rules to permit national capitals to redistribute profits generated by gas-fired plants to support consumers and businesses facing rising bills, the letter says. Another potential change would allow countries to cap the price of gas.  Von der Leyen said both of these policies had been used after Russia’s invasion of Ukraine in 2022 and stressed that the Commission would determine on a case-by-case basis whether they would be deployed again. “The design of these emergency mechanisms should in any case avoid internal market distortions, preserve long-term investment signals for clean energy and preclude excessive additional demand for gas,” she said.  The Commission will also “further strengthen” a mechanism that allows countries to compensate 80 percent of the carbon price paid under the Emissions Trading System, the EU’s flagship carbon pricing mechanism, von der Leyen added.   The letter also stresses that measures ought to be “targeted and temporary” — an apparent rebuke to countries that have sought to dismantle key climate policies that they blame for higher prices.  The Commission president added that the Commission would also look into simplifying rules for companies to buy electricity through power purchase agreements. It will also propose a new law to “ensure that grid users receive the right incentives to make optimal use of existing grid infrastructure, as this will avoid unnecessary and costly grid expansions,” she said. 

The National Fund for Environmental Protection and Water Management (NFEPWM) will be the first institution to implement the ELENA (European Local Energy Assistance) instrument at the national level in Poland. As the leader of green investment financing in Poland, it is launching a new advisory services segment for companies and local governments preparing sustainable investments. On March 3, 2026, in Luxembourg, Ioannis Tsakiris, a vice president at the European Investment Bank, and Dorota Zawadzka-Stepniak, the board president of the NFEPWM, officially acknowledged an agreement for the ELENA National Pilot Program. The project preparation budget is €4.5 million, with €4.05 million provided as grant support from the ELENA facility — a joint EIB and European Commission facility under InvestEU. Pre-investment support will target local government authorities and heating companies. Increased investments in heating and energy efficiency will lead to energy savings and reduced carbon dioxide emissions. These efforts are part of Poland’s energy transition, with the NFEPWM playing a significant role. In 2026, the fund will allocate 85 percent of its planned green investment budget of €8.8 billion to the energy transition. After a consultation, the European Commission formally approved the ELENA grant, and it was decided to leverage the NFEPWM’s experience to implement an ELENA pilot mechanism nationally. The fund will combine its experience with the EIB’s established practices under the ELENA instrument. After the pilot phase, the NFEPWM plans to continue and expand the program to include beneficiaries from other sectors. > In 2026, the fund will allocate 85 percent of its planned green investment > budget of €8.8 billion to the energy transition. “The competence center, established as part of the ELENA project, addresses market needs in investment consulting to support Poland’s energy transition. The ELENA program will provide the NFEPWM with a unique range of services in Europe, combining advisory and financial support for future beneficiaries. This initiative aligns with the fund’s strategy for 2025–2028, which focuses on developing advisory services and creating a competence center within the fund, as well as utilizing modern financial instruments,” explains Zawadzka-Stepniak. ELENA in Poland: pilot project assumptions Between 2026 and 2029, Polish investors planning thermal modernization of public buildings and upgrades in the heating sector will have access to advisory services. Local government authorities and heating companies will receive comprehensive expert support in preparing their investments. The involvement of relevant experts will facilitate the development of high-quality project documentation, leading to effective funding applications in calls for proposals conducted by the NFEPWM. The pilot program will support entities that choose not to modernize public buildings or heating plants due to a lack of know-how. It will target new investors who can evaluate the profitability of potential investments, helping to expand the NFEPWM program’s beneficiaries. Some Polish local authorities and heating companies, constrained by limited finances, avoid the risk of inefficient spending on investment analysis, missing the chance to secure support from European funds or the Modernisation Fund. Under the ELENA project, the NFEPWM will reach out to these investors, providing technical assistance and identifying financing opportunities for future projects. This approach addresses the need for local governments to enhance energy efficiency and the requirements for heating companies to adopt more environmentally friendly heat generation methods. The future beneficiary will gain a partner in the NFEPWM, an expert in preparing technical documentation for co-financing applications and green project funding. Assistance will focus on supporting preparatory processes, including energy audits, feasibility studies, technical documentation, public procurement services and ex-ante analyses. The transformation of district heating is a priority for change in the Polish economy, making it crucial to enhance the efficiency of district heating systems and increase the use of renewable energy from various sources. More than 15 million Poles are daily users of district heating produced by small municipal heating plants typical of the Central European region. Although the networks are extensive, improving their efficiency is often necessary. The challenges include reducing heat production from coal combustion and minimizing unnecessary heat consumption. Companies are increasingly investing in modern technologies that decrease the release of dust and harmful compounds into the atmosphere. The last 20 years have brought significant changes to the Polish heating sector — carbon dioxide emissions have fallen by nearly 20 percent, the production of harmful dust has been reduced by over 90 percent, sulfur dioxide emissions have decreased by almost 90 percent and nitrogen oxides by over 60 percent. > For nearly 37 years, the NFEPWM has led green transformation financing in > Poland, improving the natural environment and quality of life. It has > co-financed environmental protection and water management investments totaling > nearly 160 billion złoty. Modernizing the heating sector and improving the energy efficiency of public buildings will reduce greenhouse gas emissions locally and nationally. The ELENA project in Poland will co-finance at least 65 entities in the heating sector. Energy efficiency projects will lower energy consumption, increase renewable energy use and enhance facility comfort. Long-term investments will reduce local government operating costs, improving air quality and residents’ quality of life. The national pilot aims to support analyses and documentation for at least 80 thermal modernization investments in public buildings. The ELENA instrument is implemented by the European Investment Bank under an agreement with the European Commission. Established in 2009 as part of the Intelligent Energy Europe II program, ELENA provides pre-investment support for sustainable energy, transport and housing. It is an EIB Advisory grant facility, under InvestEU, which supports the preparation of sustainable investments. As of the end of 2025, the ELENA facility has provided €374 million in grants for 206 projects across the European Union, supporting investments of over €12.7 billion. For nearly 37 years, the NFEPWM has led green transformation financing in Poland, improving the natural environment and quality of life. It has co-financed environmental protection and water management investments totaling nearly 160 billion złoty. Thanks to the NFEPWM, green investments worth approximately 340 billion złoty have been implemented in Poland. Under the Ministry of Climate and Environment, NFEPWM supports EU environmental and energy policy objectives. -------------------------------------------------------------------------------- Polish National ELENA Pilot Programme Co-funded by the InvestEU Advisory Hub of the European Union

LONDON — Britain must “back the Americans in this vital fight against Iran!” said Reform UK Leader Nigel Farage the day the war began. Less than two weeks on and he’s changed his tune. We “don’t have a Navy” and “cannot get involved directly in another foreign war,” Farage told a press conference on Tuesday. What’s changed? An energy shock. When the conflict had just started, and before it — predictably — sent oil and gas prices soaring and became a cost-of-living issue, he was all for it. But as soon as it threatened to hit British voters in their pockets, and proved deeply unpopular in polls of normal Brits, he went all wobbly. Some of Farage’s political opponents are determined not to let the populist leader distance himself from his original enthusiasm. “Trying to pull the wool over our eyes,” said Green Party Leader Zack Polanski on Tuesday, responding to an X post in which Farage’s Treasury spokesperson, Robert Jenrick, said the “war needs to come to an end as soon as possible, because it is making Britain poorer.” Having initially backed the conflict, Reform, said Polanski, is now “the party of foreign wars and higher bills.” Liberal Democrat Leader Ed Davey has taken a similar tack, telling the BBC on Monday that voters worried about the war’s effect on the cost of living should remember that Farage’s Reform, like the Conservative’s Kemi Badenoch, “cheered on Donald Trump.” Farage insisted Tuesday there’s no inconsistency, and that his original position had merely been that Prime Minister Keir Starmer should have allowed U.S. forces to launch attacks on Iran from U.K. bases from the outset of the conflict, not necessarily that the U.K. should join attacks on Iran. But the shift in tone reveals something fundamental about British politics in 2026: The cost of living is everything. A war that threatens to send it even higher always had the potential to prove unpopular. “The public are deeply uneasy about what they think could be unnecessary and costly involvement in foreign wars, [and have] significant hesitations about too close an alignment with President Trump,” said pollster Scarlett Maguire, director of Merlin Strategy. Ed Miliband posted a video seeking to “reassure” voters that the “cost of living crisis remains our number one priority — because its yours.” | Sean Gallup/Getty Images “The cost of living crisis in this country only exacerbates this, with voters already feeling that the government are not doing enough to bring down energy prices and inflation,” she added. On Tuesday, Farage and Jenrick attempted to flip the narrative by blaming “a ruinous climate agenda” for high energy costs in the U.K. The two unveiled a pledge not to increase taxes on gasoline, a promise they would pay for by scrapping green spending on heat pumps and carbon capture technology. And the Reform UK leader downplayed the impact of the war on oil and gas prices. “If the Straits of Hormuz are cleared — I accept that’s an ‘if’ — oil will be back into the low 80s [dollars per barrel],” predicted Farage at the event at service station Derbyshire. But he was challenged by a local news reporter, who noted that a third of people in the local area use heating oil to warm their homes — and are already seeing prices rise. The Labour government has, so far, been cautious not to attack Reform or the Conservatives too fiercely for their initial stance on the war, wary of driving a further wedge between Downing Street and the White House. But they are seeking to portray themselves as the grown-ups in the room, laser-focused on the cost of living. Energy Secretary Ed Miliband posted an uncharacteristically sober video message to social media on Tuesday, seeking to “reassure” voters that the “cost of living crisis remains our number one priority — because its yours.” Despite its own missteps over the Iran war, that’s a message Starmer’s government will be desperate to land, as the conflict’s shockwaves continue to hit Britain’s shores. Noah Keate contributed to this report.

LONDON — The Palace of Westminster stands on the banks of the River Thames as a proud symbol of British democracy.  But upon closer inspection, this neo-gothic mini-village, part of a UNESCO World Heritage site, is falling apart. Britain’s parliament has become an increasingly dangerous place to work for the 650 MPs, more than 800 members of the House of Lords, and thousands more staff who use it. The Restoration and Renewal (R&R) program, set up to deliver the long-delayed overhaul of the palace, warns of serious risks from fire, flooding, crumbling stonework and aging mechanical and electrical systems. Parliament needs fixing — and in the coming weeks, MPs and peers are expected to vote on what to do next. But there’s little consensus on how to proceed. The fight over the future of the site is now pitting politicians worried about spiraling costs against those who think the need to act is growing more urgent by the day. As this week’s POLITICO Westminster Insider podcast explores, fixing parliament is a story of seemingly endless division and delay. TWO OPTIONS, EYE-WATERING NUMBERS The way forward, presented to MPs and peers by the R&R team, has been boiled down to two stark options. The first is the so-called “full decant.” This would involve moving MPs and peers out of the palace to allow major works to be carried out. On current estimates, it would take 19 to 24 years and cost up to £15.6 billion. The second is an even slower, staged approach — catchily named “Enhanced Maintenance and Improvement plus”(EMI+) — where only the House of Lords is moved out, and works are done in phases while MPs’ parliamentary business continues on the estate. But that could take 38 to 61 years and cost up to £39.2 billion, the program’s figures suggest. In the coming weeks, MPs and peers are expected to vote on whether to at least green-light an initial seven-year package of preparatory works — a step that keeps both longer-term options alive, with a final decision pushed into the next decade. One of the most prominent advocates of the faster approach is Marie Goldman, the Liberal Democrat MP for Chelmsford. Goldman is a member of parliament’s Restoration and Renewal Programme Board, a cross-party body that scrutinizes the restoration team’s work.  For Goldman, the logic is blunt: if the work is going to happen at all, it is safer and ultimately cheaper to do it without thousands of staff, MPs and visitors continuing to use the building. “Trying to do those works with MPs and everyone else in place… feels like an absolute nightmare,” she says. The fight over the future of the site is now pitting politicians worried about spiraling costs against those who think the need to act is growing more urgent by the day. | Pool photo by Henry Nicholls via WPA/Getty Images Goldman is adamant that MPs and peers find a solution and believes Britain’s international reputation is at stake: “Nothing would say. Hey, look at the demise of Britain than watching the Houses of Parliament crumble into the Thames.” The government has said it will allow MPs a free vote on the restoration plans. Labour MP Mike Reader has followed the saga closely since his election in 2024. He backs option two, EMI+. Reader told POLITICO he has spoken directly with the consultants and contractors working across the estate — and believes the restoration team has underestimated the scale of the work needed, saying he fears “the discovery risk” of finding new problems as the work progresses. Reader says a longer-term approach would allow the restoration team greater scope “to learn and improve over time.” His “biggest fear” is that a different government decides to “stall and delay” the scheme or “require a complete rethink.” “Instability and uncertainty are the biggest risks to a program like this,” he warns. WASTING MONEY The fiercest critics see the project as typical of Westminster’s habit of wasting public money — and argue selling a multi-billion pound revamp will be impossible in a country grappling with the rising cost of living. Veteran Tory MP Edward Leigh, styled as the Father of the House for his long service, is a long-standing skeptic who argues that parliament should focus narrowly on essential safety upgrades rather than what he derides as “gold-plating.”  He believes plans to create a new visitors’ reception and steps to reduce the building’s carbon footprint are “bells and whistles.” “You don’t need all this, not when there’s an economic crisis. Our constituents are going to be absolutely furious.” Leigh wants what he describes as a “third option”: repealing parts of the current legal framework that mandates the restoration “in one go” and repairing the Palace in stages around MPs. His concerns over the costs involved are shared by the Conservative Party’s top brass. Leader Kemi Badenoch has raised “serious concerns about value for money.” She has instructed her party to vote against the plans in any parliamentary vote.  ‘CATASTROPHE’ Academic and parliament restoration specialist Alexandra Meakin — who has studied the project for years and previously worked in parliament — strongly disagrees with the Conservative Party’s position. Parliament needs fixing — and in the coming weeks, MPs and peers are expected to vote on what to do next. | Andy Rain/EPA “Desperately wanting there to be a third way or for it to not cost as much or for the repairs not to be as essential doesn’t make it less true,” she warns. Meakin adds: “Every review, every expert shows you cannot do this in any cheaper, quicker or safer way than just moving out entirely.” In her view, the core purpose of restoration is not gilding the palace — but preventing a future in which the building becomes unusable because of a major fire, flood or infrastructure failure. She warns: “The catastrophe is coming. The Palace of Westminster will become uninhabitable, whether it’s through fire, flood, or a failure of the essential infrastructure. And at that point, MPs and peers will have to face up to the fact that they have lost their own workplace, but they’ve also lost this iconic building for the nation.” LOOKING TO OTTAWA The U.K. is not the only old democracy grappling with decaying, neo-Gothic legislature buildings. Canada’s already moved its Commons chamber into a temporary home (known as West Block) while major works on Ottawa’s Centre Block proceed. Nick Taylor-Vaisey is POLITICO’s Ottawa bureau chief. He told Westminster Insider that Canada’s success was in part down to persuading hesitant MPs to move out entirely. The trick? Ensuring they were excited by their new alternative. “The West Block Chamber is actually a former courtyard and there is a glass ceiling on top, a novel, modern take on how you can build a legislature.”  Looking to the U.K., Taylor-Vaisey advised: “There is this chance to rethink what it could be.” Current plans in Westminster would likely involve MPs moving into Richmond House on the Whitehall estate, while the Lords would move into the QEII conference center. So far neither seems to have captured the imagination. 

When David stepped onto the battlefield, he did not oppose order. He opposed imbalance. He did not reject authority. He rejected disproportionate power concentrated in the hands of a giant. Today, many European taxpayers feel cast in a comparable role. Across the European Union, a growing number of citizens sense that the balance between Brussels and the member states is shifting in ways that were neither clearly articulated nor democratically legitimized. What was conceived as a union of sovereign nations cooperating for peace and prosperity increasingly resembles a polity acquiring its own fiscal architecture — one that reaches directly into the pockets of Europeans. The StopEUTaxes campaign was born from this concern. It is not anti-European. It is not nostalgic. It is not isolationist. It is constitutional. Via Taxpayers Europe At the heart of the European project lies subsidiarity — the principle enshrined in the Maastricht Treaty that decisions should be taken as closely as possible to citizens. Taxation has always been among the most sovereign of competencies. It reflects national political choices, social contracts and economic priorities. It binds voters to governments through accountability. The current debate over new EU ‘own resources’ challenges that settlement. Since 2020, the European Union has entered new terrain. Joint borrowing under the NextGenerationEU program marked an extraordinary response to extraordinary circumstances. The pandemic demanded speed and scale. Member states agreed to mutualized debt to stabilize the single market and avoid fragmentation. But extraordinary measures risk becoming precedents. To repay common debt, the European Commission has proposed expanding EU-level revenue streams — carbon border adjustment mechanisms, digital levies, emissions trading revenues and other instruments framed as technical necessities. From the European Commission’s perspective, these are pragmatic tools to sustain shared projects without increasing national contributions. Yet the constitutional implications are far from technical. Once the union acquires permanent fiscal instruments independent of national treasuries, the nature of the EU changes. A supranational entity financed directly at EU level no longer depends solely on member-state transfers. It gains structural autonomy. Over time, fiscal capacity drives political capacity. The question is not whether these specific levies are justified. The question is whether Europeans have collectively decided to transform the union into something closer to a federal fiscal authority. That debate has not truly taken place. Under President Ursula von der Leyen, the European Commission has demonstrated ambition and managerial resolve. The Green Deal, industrial policy initiatives, capital markets integration, digital regulation and geopolitical positioning have given Brussels a new assertiveness. In moments of crisis, this decisiveness has reassured markets and partners alike. But strength without clearly defined limits generates anxiety. To critics, the cumulative effect of regulatory expansion, centralized borrowing and proposals for permanent ‘own resources’ signals a steady rebalancing of power toward the center. The European Union was never intended to become the United States of Europe through incremental fiscal evolution. It was constructed as a union of member states cooperating within defined competences. Taxation is not merely a revenue mechanism. It is the foundation of democratic accountability. National parliaments debate budgets, justify expenditures and face voters. When fiscal authority migrates upward, accountability chains grow longer and more opaque. Supporters of EU-level taxation argue that shared challenges require shared resources. Climate transition, defense coordination, industrial competitiveness and geopolitical resilience demand investment beyond the scale of individual member states. Fragmentation, they warn, would weaken Europe in a world of continental powers. There is merit in acknowledging those pressures. Yet, integration must follow consent, not precede it. The current trajectory risks creating fiscal facts before a political mandate is secured. Joint debt was justified as temporary. ‘Own resources’ were presented as targeted. Yet the logic of institutional development suggests permanence. Once established, revenue streams rarely disappear. This is where the David and Goliath metaphor resonates. The giant is not a person. It is a system — a structure that grows by incremental extension of competences. The David is not anti-European protest. It is the taxpayer who expects clarity about who taxes, who spends and who is accountable. European integration has historically advanced through treaty change, ratified by national parliaments. If the Union is to evolve into a fiscal entity with autonomous revenue capacity, that evolution deserves explicit political authorization. It should not occur through regulatory layering and budgetary creativity. President von der Leyen herself is no despot. She has navigated war, pandemic recovery and economic disruption with discipline. But leadership in times of crisis must also include restraint in times of normalization. The credibility of the European project depends not only on effectiveness, but also on constitutional integrity. There is a broader economic dimension as well. Europe faces stagnating productivity, deindustrialization pressures and rising budget deficits at national level. Households are experiencing the lingering effects of inflation and high energy costs. In such an environment, proposals for new EU-level revenue instruments — however rationalized — risk deepening the perception of distance between institutions and citizens. Political legitimacy is not measured solely in treaty articles. It is measured in trust. If taxpayers conclude that Brussels acquires fiscal powers without transparent consent, trust erodes. And when trust erodes, integration becomes fragile. The StopEUTaxes campaign is therefore less about any single levy than about drawing a constitutional line. It argues that the union should recommit to subsidiarity — not as rhetoric, but as operational principle. Shared challenges should be addressed through coordination, not quiet centralization. Fiscal sovereignty should remain anchored in member states unless explicitly transferred through democratic mandate. Europe does not need confrontation between capitals and Brussels. It needs clarity. The union’s founding promise was cooperation among sovereign democracies, not the gradual absorption of their core competences. If a federal fiscal Europe is the destination, that case should be made openly to voters across all member states. Until then, prudence is not obstructionism. It is constitutional responsibility. David’s victory was not about dismantling order. It was about restoring balance. In today’s Europe, the call from taxpayers is similar: pause, reflect and ensure that the architecture of integration remains anchored in democratic consent rather than institutional momentum. The future of Europe depends not only on ambition, but on proportionality. And proportionality begins with recognizing that power — especially the power to tax — must always be matched by clear and direct accountability. That is not resistance to Europe. It is defense of the Europe that was promised. Via Taxpayers Europe -------------------------------------------------------------------------------- Disclaimer POLITICAL ADVERTISEMENT * The sponsor is Taxpayers Europe * This political advertisement advocates for limiting the European Union’s fiscal autonomy, opposing the expansion of EU “own resources,” and reinforcing national control over taxation; by addressing joint borrowing under NextGenerationEU, EU revenue instruments such as carbon border mechanisms and digital levies, and the broader constitutional balance between Brussels and member states, it seeks to influence policymakers and public debate on EU fiscal governance and sovereignty, bringing it within the scope of the TTPA. More information here.