The European Commission has proposed giving itself legally-enshrined power to plan the expansion of European electricity grids, as it scrambles to update an ageing network to meet the soaring demands of the clean energy transition. The proposed changes to the Trans-European Networks for Energy, or TEN-E, regulation, would give the Commission power to conduct “central scenario” planning to assess what upgrades are needed to the grid — a marked change from the current decentralized system of grid planning. The Commission would conduct this planning every four years. Where no projects are planned, the Commission would have power to intervene. The proposal was part of the European Grids Package, a sweeping set of changes to EU energy laws released Wednesday. Electrification of everything from transport and heating to industrial processes is essential as Europe moves away from planet-warming fossil fuels. But that puts huge strain on networks, and the Commission estimates electricity demand will double by 2040. An efficient, pan-European electricity grid is essential to meeting this demand. “The European Grids Package is more than just a policy,” said Teresa Ribera, the EU’s decarbonization chief, in a statement Tuesday. “It’s our commitment for an inclusive future, where every part of Europe reaps the benefits of the energy revolution: cheaper clean energy, reduced dependence on imported fossil fuels, secure supply and protection against price shocks.” Along with centralized planning, the Grids Package proposes speeding up permitting of grids and other energy projects to get the infrastructure faster, including relaxing environmental planning rules for grids. Currently planning and building new grid infrastructure takes around 10 years. It would do this by amending four laws: the TEN-E regulation, the Renewable Energy Directive, the Energy Markets Directive, and the Gas Market Directive. The package also proposes “cost-sharing” funding models to ensure those countries that benefit from projects contribute to its financing, and speeding up a number of key energy interconnection projects across Europe.

Iris Ferguson is a global adviser to Loom and a former U.S. deputy assistant secretary of defense for Arctic and global resilience. Ann Mettler is a distinguished visiting fellow at Columbia University’s Center on Global Energy Policy and a former director general of the European Commission. After much pressure, European leaders delayed a decision this week amid division on whether to tighten market access through a “Made in Europe” mandate and redouble efforts to reduce the bloc’s strategic dependencies — particularly on China. This decision may appear technocratic, but the hold-up signals its importance and reflects a larger strategic reality shared across the Atlantic. Security, industry and energy have all fused into a single race to control the systems that power modern economies and militaries. And increasingly, success will hinge on whether the U.S. and Europe can confront this reality together, starting with the one domain that’s shaping every other: energy. While traditional defense spending still grabs headlines, today’s battlefield is being reshaped just as profoundly by energy flows and critical inputs. Advanced batteries for drones, portable power for forward-deployed units and mineral supply chains for next-generation platforms — these all point to the simple truth that technological and operational superiority increasingly depends on who controls the next generation of energy systems. But as Europe and the U.S. look to maintain their edge, they must rethink not just how they produce and move energy, but how to secure the industrial base behind it. Energy sovereignty now sits at the center of our shared security, and in a world where adversaries can weaponize supply chains just as easily as airspace or sea lanes, the future will belong to those who build energy systems that are resilient and interoperable by design. The Pentagon already understands this. It has tested distributed power to shorten vulnerable fuel lines in war games across the Indo-Pacific; it has watched closely how mobile generation units keep the grid alive under Russian attack in Ukraine; and it is exploring ways to deliver energy without relying on exposed logistics via new research on solar power beaming. Each of these cases clearly demonstrates that strategic endurance now depends on energy agility and security. But currently, many of these systems depend on materials and manufacturing chains that are dominated by a strategic rival: From batteries and magnets to rare earth processing, China controls our critical inputs. This isn’t just an economic liability, it’s a national security vulnerability for both Europe and the U.S. We’re essentially building the infrastructure of the future with components that could be withheld, surveilled or compromised. That risk isn’t theoretical. China’s recent export controls on key minerals are already disrupting defense and energy manufacturers — a sharp reminder of how supply chain leverage can be a form of coercion, and of our reliance on a fragile ecosystem for the very technologies meant to make us more independent. So, how do we modernize our energy systems without deepening these unnecessary dependencies and build trusted interdependence among allies instead? The solution starts with a shift in mindset that must then translate into decisive policy action. Simply put, as a matter of urgency, energy and tech resilience must be treated as shared infrastructure, cutting across agencies, sectors and alliances. Defense procurement can be a catalyst here. For example, investing in dual-use technologies like advanced batteries, hardened micro-grids and distributed generation would serve both military needs and broader resilience. These aren’t just “green” tools — they’re strategic assets that improve mission effectiveness, while also insulating us from coercion. And done right, such investment can strengthen defense, accelerate innovation and also help drive down costs. Next, we need to build new coalitions for critical minerals, batteries, trusted manufacturing and cyber-secure infrastructure. Just as NATO was built for collective defense, we now need economic and technological alliances that ensure shared strategic autonomy. Both the upcoming White House initiative to strengthen the supply chain for artificial intelligence technology and the recently announced RESourceEU initiative to secure raw materials illustrate how partners are already beginning to rewire systems for resilience. Germany gave the bloc one such example by moving to reduce its reliance on Chinese-made wind components in favor of European suppliers. | Tan Kexing/Getty Images Finally, we must also address existing dependencies strategically and head-on. This means rethinking how and where we source key materials, including building out domestic and allied capacity in areas long neglected. Germany recently gave the bloc one such example by moving to reduce its reliance on Chinese-made wind components in favor of European suppliers. Moving forward, measures like this need EU-wide adoption. By contrast, in the U.S., strong bipartisan support for reducing reliance on China sits alongside proposals to halt domestic battery and renewable incentives, undercutting the very industries that enhance resilience and competitiveness. This is the crux of the matter. Ultimately, if Europe and the U.S. move in parallel rather than together, none of these efforts will succeed — and both will be strategically weaker as a result. The EU’s High Representative for Foreign Affairs and Security Policy Kaja Kallas recently warned that we must “act united” or risk being affected by Beijing’s actions — and she’s right. With a laser focus on interoperability and cost sharing, we could build systems that operate together in a shared market of close to 800 million people. The real challenge isn’t technological, it’s organizational. Whether it be Bretton Woods, NATO or the Marshall Plan, the West has strategically built together before, anchoring economic resilience with national defense. The difference today is that the lines between economic security, energy access and defense capability are fully blurred. Sustainable, agile energy is now part of deterrence, and long-term security depends on whether the U.S. and Europe can build energy systems that reinforce and secure one another. This is a generational opportunity for transatlantic alignment; a mutually reinforcing way to safeguard economic interests in the face of systemic competition. And to lead in this new era, we must design for it — together and intentionally. Or we risk forfeiting the very advantages our alliance was built to protect.

BRUSSELS — The European Commission has unveiled a new plan to end the dominance of planet-heating fossil fuels in Europe’s economy — and replace them with trees. The so-called Bioeconomy Strategy, released Thursday, aims to replace fossil fuels in products like plastics, building materials, chemicals and fibers with organic materials that regrow, such as trees and crops. “The bioeconomy holds enormous opportunities for our society, economy and industry, for our farmers and foresters and small businesses and for our ecosystem,” EU environment chief Jessika Roswall said on Thursday, in front of a staged backdrop of bio-based products, including a bathtub made of wood composite and clothing from the H&M “Conscious” range. At the center of the strategy is carbon, the fundamental building block of a wide range of manufactured products, not just energy. Almost all plastic, for example, is made from carbon, and currently most of that carbon comes from oil and natural gas. But fossil fuels have two major drawbacks: they pollute the atmosphere with planet-warming CO2, and they are mostly imported from outside the EU, compromising the bloc’s strategic autonomy. The bioeconomy strategy aims to address both drawbacks by using locally produced or recycled carbon-rich biomass rather than imported fossil fuels. It proposes doing this by setting targets in relevant legislation, such as the EU’s packaging waste laws, helping bioeconomy startups access finance, harmonizing the regulatory regime and encouraging new biomass supply. The 23-page strategy is light on legislative or funding promises, mostly piggybacking on existing laws and funds. Still, it was hailed by industries that stand to gain from a bigger market for biological materials. “The forest industry welcomes the Commission’s growth-oriented approach for bioeconomy,” said Viveka Beckeman, director general of the Swedish Forest Industries Federation, stressing the need to “boost the use of biomass as a strategic resource that benefits not only green transition and our joint climate goals but the overall economic security.” HOW RENEWABLE IS IT? But environmentalists worry Brussels may be getting too chainsaw-happy. Trees don’t grow back at the drop of a hat and pressure on natural ecosystems is already unsustainably high. Scientific reports show that the amount of carbon stored in the EU’s forests and soils is decreasing, the bloc’s natural habitats are in poor condition and biodiversity is being lost at unprecedented rates. Protecting the bloc’s forests has also fallen out of fashion among EU lawmakers. The EU’s landmark anti-deforestation law is currently facing a second, year-long delay after a vote in the European Parliament this week. In October, the Parliament also voted to scrap a law to monitor the health of Europe’s forests to reduce paperwork. Environmentalists warn the bloc may simply not have enough biomass to meet the increasing demand. “Instead of setting a strategy that confronts Europe’s excessive demand for resources, the Commission clings to the illusion that we can simply replace our current consumption with bio-based inputs, overlooking the serious and immediate harm this will inflict on people and nature,” said Eva Bille, the European Environmental Bureau’s (EEB) circular economy head, in a statement. TOO WOOD TO BE TRUE Environmental groups want the Commission to prioritize the use of its biological resources in long-lasting products — like construction — rather than lower-value or short-lived uses, like single-use packaging or fuel. A first leak of the proposal, obtained by POLITICO, gave environmental groups hope. It celebrated new opportunities for sustainable bio-based materials while also warning that the “sources of primary biomass must be sustainable and the pressure on ecosystems must be considerably reduced” — to ensure those opportunities are taken up in the longer term. It also said the Commission would work on “disincentivising inefficient biomass combustion” and substituting it with other types of renewable energy. That rankled industry lobbies. Craig Winneker, communications director of ethanol lobby ePURE, complained that the document’s language “continues an unfortunate tradition in some quarters of the Commission of completely ignoring how sustainable biofuels are produced in Europe,” arguing that the energy is “actually a co-product along with food, feed, and biogenic CO2.” Now, those lines pledging to reduce environmental pressures and to disincentivize inefficient biomass combustion are gone. “Bioenergy continues to play a role in energy security, particularly where it uses residues, does not increase water and air pollution, and complements other renewables,” the final text reads. “This is a crucial omission, given that the EU’s unsustainable production and consumption are already massively overshooting ecological boundaries and putting people, nature and businesses at risk,” said the EEB. Delara Burkhardt, a member of the European Parliament with the center-left Socialists and Democrats, said it was “good that the strategy recognizes the need to source biomass sustainably,” but added the proposal did not address sufficiency. “Simply replacing fossil materials with bio-based ones at today’s levels of consumption risks increasing pressure on ecosystems. That shifts problems rather than solving them. We need to reduce overall resource use, not just switch inputs,” she said. Roswall declined to comment on the previous draft at Thursday’s press conference. “I think that we need to increase the resources that we have, and that is what this strategy is trying to do,” she said.

LONDON — Ministers must act now to address an “emerging risk to gas supply security,” the government’s official independent energy advisers have warned.  The government must make plans to avert a threat to future gas supplies, the National Energy System Operator (NESO) said.  While the advisers say the conditions creating a gas supply crisis are unlikely, any shortage would have a severe impact on the country. In its first annual assessment of Britain’s gas security, expected to be released later today but seen by POLITICO, the NESO said diminishing reserves of gas in the North Sea and competition for imports are creating new energy security risks, even as the country’s decarbonization push reduces overall demand for the fossil fuel.  Britain is projected to have sufficient gas supplies for normal weather scenarios by winter 2030/31, but in the event of severe cold weather and an outage affecting key infrastructure, supply would fall well short of demand, NESO projects.   The scenario in the report involves what the NESO calls the “unlikely event” of a one-in-20-year cold spell lasting 11 days alongside the loss of vital infrastructure.   If this were to occur, the consequences of a shortfall in gas supply could be dire.   It could trigger emergency measures including cutting off gas from factories, power stations, and — in extreme scenarios — homes as well. It could take weeks or months to return the country to normal.   The vast majority of homes still use gas boilers for heating.   VULNERABILITY Informed by the NESO’s findings, ministers have published a consultation setting out a range of options for shoring up gas security.  It comes amid growing concern in Whitehall about the U.K.’s vulnerability to gas supply disruptions. Russia is actively mapping key offshore infrastructure like gas pipelines and ministers have warned it has the capability to “damage or destroy infrastructure in deepwater,” in the event that tensions over Ukraine spill over into a wider European conflict.  While Britain has long enjoyed a secure flow of domestically-produced gas from the North Sea — which still supplies more than a third of the fuel — NESO’s report says gas fields are experiencing “rapid decline.” The amount available to meet demand in Britain falls to “12 to 13 percent winter-on-winter until 2035,” it says.  That will leave the U.K. ever more dependent on imports, via pipeline from Norway and increasingly via ship-borne liquefied natural gas (LNG) from the U.S. — and Britain will be competing with other countries for the supply of both.  The report projects that during peak demand periods in the 2030s, the Britain’s import dependency will be as high as 90 percent or more.  Overall, gas demand will be lower in the 2030s because of the shift to renewable electricity and electric heating, but demand will remain relatively high on very cold days, and when there is little wind to power offshore turbines, requiring gas power stations to be deployed, the report says.  “This presents emerging risks that we will need to understand to ensure reliable supplies are maintained for consumers,” it adds.  Reducing demand for gas by decarbonizing will be key, the report says, and risks are higher in scenarios where the country slows down its shift away from gas.   But decarbonization alone will not be enough to ensure the U.K. would meet the so-called “N-1 test” — a sufficient supply of gas even if the “single largest piece” of gas infrastructure fails — during a prolonged cold spell in winter 2030/31. In that scenario, “peak day demand” is projected to reach 461 million cubic meters (mcm), but supply would fall to 385 mcm, resulting in a supply deficit of 76 mcm, a shortfall of around 16 percent of what is needed to power the country on that day.  That means ministers should start considering alternative options now, including the construction of new infrastructure like storage facilities, liquefied natural gas (LNG) import terminals, or new onshore pipelines to ensure more gas can get from LNG import sites to the rest of the country. The government consultation will look at these and other options.   The critical piece of gas infrastructure considered under the N-1 test is not identified for security reasons, but is likely to be a major import pipeline from Norway or an LNG terminal. The report says that even “smaller losses … elsewhere in the gas supply system” could threaten gas security in extreme cold weather.  GAS SECURITY ‘PARAMOUNT’  The findings will likely be seized on by the oil and gas industry to argue for a more liberal licensing and tax regime in the North Sea, on a day when the government announced its backing for more fossil fuel production in areas already licensed for exploration.  But such measures are unlikely to be a silver bullet. The report says: “Exploration of new fields is unlikely to deliver material new capacity within the required period.”  Deborah Petterson, NESO’s director of resilience and emergency management, said that gas supply would be “sufficient to meet demand under normal weather conditions.”  “We have, however, identified an emerging risk to gas supply security where decarbonization is slowest or in the unlikely event of the loss of the single largest piece of gas infrastructure on the system.  “By conducting this analysis, we are able to identify emerging risks early and, crucially, in time for mitigations to be put in place,” she added.  A spokesperson for the Department of Energy Security and Net Zero said ministers were “working with industry to ensure the gas system is fit for the future, including maintaining security of supply — which is paramount.”   “Gas will continue to play a key role in our energy system as we transition to clean, more secure, homegrown energy,” they added. “This report sets out clearly that decarbonization is the best route to energy security — helping us reduce demand for gas while getting us off the rollercoaster of volatile fossil fuel markets.”  Glenn Bryn-Jacobsen, director of energy resilience and systems at gas network operator National Gas Transmission, said in the short-term, Britain’s gas supply outlook was “robust” but that “looking ahead, we recognise the potential longer-term challenges.” “Gas remains a critical component of Britain’s energy security — keeping homes warm, powering industry, and supporting electricity generation during periods of peak demand and low renewable output,” he added. “In considering potential solutions, it is essential to look at both the gas supply landscape and the investment required in network infrastructure,” he said. 

LONDON — U.K. Energy Secretary Ed Miliband was on the world stage last week demanding high-polluting fossil fuels are phased out of global energy systems.  “This is an issue that cannot be ignored,” he told the COP climate summit in Brazil.  Yet this week could see his own government water down commitments to phase out fossil fuels. Insiders say a drawn-out fight over the future of drilling in the U.K.’s Scottish oil and gas heartlands is finally reaching its conclusion.  It is a row which has split the governing Labour Party, pitted Miliband against the all-powerful Treasury, and will, some of Labour’s own MPs fear, undermine the government’s climate credentials and expose the party to even more political pain.  “If a progressive government with a big majority, in the country that started the Industrial Revolution, can’t hold firm on new fossil fuel drilling,” worried one Labour MP, “how can we expect developing countries to do what’s needed to tackle climate change?”  The MP, along with other officials and experts in this piece, was granted anonymity to give a frank view on sensitive political planning.  The decisions follow months of full-throated lobbying by fossil fuel companies, who argue tough action against high-polluting oil and gas firms will hit jobs and derail the wider economy — but also by green campaigners, desperate to hold Labour to its promises to make the U.K. a global climate leader.  And there is a growing risk for ministers that, as the government searches for a compromise to satisfy the party and balance fiscal demands with net-zero ambitions, it will land on a solution which pleases no one at all.  LICENSES, TAXES, ELECTIONS Two government figures and three figures from industry told POLITICO they expect minsters to announce a decision on North Sea licenses on Wednesday, to coincide with the Budget.  Labour swept to power last year on a promise to ban new oil and gas exploration licenses in the declining basin, as well as maintaining taxes on high polluters in the North Sea.  But there is likely to be a “pragmatic” shift on North Sea policy, one of the government figures said. Officials are looking at allowing oil and exploration on existing fields (so-called “tiebacks”) and potentially loosening rules on investment relief, they said.  Fossil fuel lobbyists argue that, without this sort of help, thousands of jobs and billions in investment are at risk.  “There is a sense that the industry are not crying wolf this time,” the same government figure said.  The tax is currently set to remain until 2030, but Chancellor Rachel Reeves is considering scrapping it earlier, in a bid to drive the U.K.’s stalling economy. | Pool photo by Leon Neal via Getty Images They added that ministers will likely be making decisions with Scottish elections in May firmly in mind — conscious that the future of the oil and gas sector is a priority for many Scottish voters already worried about the decline of the North Sea economy, embodied in the closure of Grangemouth refinery.  Approving tiebacks would allow Miliband to say he has stuck to his election pledge while still expanding opportunities for oil and gas producers.  The Treasury is also due to decide the future of the Windfall Tax on oil and gas companies before the end of the year — a levy on profits hated by the industry but used to fund Miliband’s rush to move the U.K. to a cleaner energy system.   The tax is currently set to remain until 2030, but Chancellor Rachel Reeves is considering scrapping it earlier, in a bid to drive the U.K.’s stalling economy.  Lobby group Offshore Energies UK (OEUK) claims the country could enjoy a £40 billion economic boost if the Windfall Tax was ditched as soon as next year.   A fourth industry figure said a decision on whether to approve drilling on the controversial Rosebank gas field — which already holds a license — could also come this week, although the field’s developers think it is more likely in the new year. Officials from Miliband’s Department for Energy Security and Net Zero summoned OEUK for a meeting Friday in Whitehall, according to two of the industry figures. ‘POLITICALLY STUPID’  The idea of softening fossil fuel policy is alarming some on Labour’s backbenches.  Referencing the pledge not to allow new drilling licenses, Barry Gardiner, an environment minister under Tony Blair and now a member of parliament’s Environmental Audit Committee, said: “It is a commitment that I am sure the chancellor will wish to honor, given that yet another broken promise or U-turn would be as politically stupid as it would be environmentally illiterate.”  The pledge, he said, had “sat happily with the U.K’s commitment at the last COP to phase out fossil fuels.” Fellow Labour MP Clive Lewis said any watering-down would be a “mistake.”   “It would signal that the government is more focused on reassuring fossil-fuel interests than giving the public a credible plan for energy security and climate stability. Voters aren’t blind to that,” he said.  But their views are not shared across the party.  Mary Glindon, a Labour MP in the former industrial city of Newcastle, hosted OEUK in parliament earlier this month.  “The truth is that our once proud North Sea energy industry is shedding about one thousand jobs a month. … Without renewed investment, I fear for our communities and the prosperity of our young people,” she told an audience of MPs, lobbyists and business leaders.  OEUK, in a letter to Prime Minister Keir Starmer this September, seen by POLITICO, said that “without fiscal reform, changes to the regulatory framework and licensing will be insufficient on their own to transform the outlook for the industry.” | Pool Photo by Henry Nicholls via Getty Images Policy in the North Sea must show workers “that we are on their side,” Scottish Labour MP Torcuil Crichton told POLITICO earlier this year.   Gary Smith, general secretary of GMB Union — traditionally a champion of Labour which represents thousands of oil and gas workers — told the same OEUK event: “This is a crucial moment in terms of the Budget, and if the government gets this wrong on the future that the North Sea, it will be a strategic, long-term disaster for this country.”   A DESNZ spokesperson said: “We will implement our manifesto position in full to not issue new licences to explore new oil and gas fields. “Our priority is to deliver a fair, orderly and prosperous transition in line with our climate and legal obligations, with the biggest ever investment in offshore wind and first of a kind carbon capture and storage clusters.” PRESSURE ALL AROUND Even if the government is willing to upset its greenest backbenchers, it still won’t be enough to win round the biggest backers of oil and gas.  OEUK, in a letter to Prime Minister Keir Starmer this September, seen by POLITICO, said that “without fiscal reform, changes to the regulatory framework and licensing will be insufficient on their own to transform the outlook for the industry.” Robin Allan, chairman of the lobby group BRINDEX, also argues potential changes to the industry’s fiscal and licensing regimes would do little to revive the industry.  “The tweaking and tinkering of existing policies will not make the North Sea an investable basin,” he said. To restore business confidence, he argued, “wholesale reform is needed.”  There is nervousness inside Labour that attempts to navigate these pressures will leave the government, already struggling with voters, even more vulnerable.  The Green Party, helmed by media-savvy new leader Zack Polanski, is rising in the polls.   Labour would be “wriggling out” of their climate commitments if they pushed ahead with tiebacks and Windfall Tax reforms, argued Green MP and the party’s Westminster leader Ellie Chowns. It would be “politically mad to allow new drilling licences when the Greens are surging in the polls,” argued the same Labour MP quoted at the top of this article.  “The growing support for the [Green Party] shows that people want honesty, consistency and a transition [to net zero] that protects workers and communities rather than corporate profits,” said Clive Lewis.  And the pressure would not just come from the left.   Nigel Farage’s poll-topping Reform UK has promised to let oil and gas companies drill the North Sea basin until it is dry.  The Conservatives, too, are staking out a much stronger line backing fossil fuels.  “Anything short of an overturn of the [Windfall Tax] and … a complete overturn of the [licensing] ban is going to fall far short of what the industry needs at this time,” said Tory Shadow Energy Minister Andrew Bowie.  Think tanks close to Miliband’s own left flank of politics are getting restless.   Softening the regime in the North Sea might appear to have political dividends by heading off the Tories and Reform, said Alex Chapman, senior economist at the New Economics Foundation, but Labour should resist it. “I think it would be a terrible, terrible decision,” he said. 

BELÉM, Brazil — The European Union was notably absent from a group of 82 countries calling for a clear path away from fossil fuels at the U.N. climate talks on Tuesday. In a moment of theater in the Amazon city of Belém, dozens of countries demanded a “roadmap” that would chart their way off fossil fuels — sending the fuels that drive climate change to the fore of a U.N. process that rarely discusses them directly.  But the EU, a self-described climate leader, was not among them. Many EU countries backed the démarche, with ministers from Denmark and Germany taking a prominent role in the announcement.  In a statement, Germany’s Environment Minister Carsten Schneider called on the meeting “to free ourselves from fossil fuels … it can help with access to energy, lowering prices for households and businesses and strengthening our energy security.” For the EU to back the initiative, all countries in the 27-nation bloc would need to unify behind it. The EU has recently undergone a tough process of setting new climate goals that drew opposition from countries with ties to coal and the car industry. “This is completely in the EU interest,” said Jennifer Morgan, Germany’s former climate envoy. “So I’m quite puzzled that there are evidently a couple of member states that are nervous about this.” EU representatives did not respond to requests for comment in time for publication.

KYIV — Ukraine was roiled this week by the most damaging corruption scandal of Volodymyr Zelenskyy’s presidency.  Ukrainian anti-corruption agencies revealed Monday that some of Zelenskyy’s close associates were allegedly involved in a plot to skim around $100 million from Ukraine’s energy sector. The scandal erupted as Ukrainians suffer blackouts caused by Russian bombing. The state said it had spent tens of millions of euros to protect energy infrastructure from drones and missiles. “Any effective action against corruption is very necessary,” Zelenskyy warned Monday night. “The inevitability of punishment is necessary.” We explain below what’s at stake as the corruption probe snowballs to implicate key allies of Zelenskyy.  WHO CRACKED THE CASE? Ukraine’s state anti-corruption watchdogs — the National Anti-Corruption Bureau of Ukraine, or NABU, and the Special Anti-Corruption Prosecutor’s Office, or SAP — dismantled an alleged criminal organization that consisted of current and former energy officials, a noted businessman, government ministers and a former deputy prime minister. The probe, which lasted 15 months and was called “Operation Midas,” involved 1,000 hours of wiretapping and resulted in the seizure of bags of cash. The agency said five of the seven alleged participants in the scheme have been detained. The group is accused of manipulating contracts at Energoatom, Ukraine’s state nuclear energy company, to extract kickbacks worth 10-15 percent of contract values. Investigators say the network laundered roughly $100 million through a secret Kyiv-based office. WHO’S IN THE FRAME? Over the last few days, some names of high-profile suspects were revealed to the public during online court sessions. Businessman Timur Mindich, a close ally of Zelenskyy, might be the most interesting name in the crosshairs of prosecutors — but more on him later.   The most prominent is current Justice Minister German Galushchenko, who was suspended from his post Wednesday morning. He was energy minister until July before Zelenskyy reshuffled his government. Prosecutors said Galushchenko assisted Mindich in his money-laundering schemes and was influenced by the businessman. Although he has not been charged, the accusations triggered his suspension. Galushchenko said he supports the suspension, but added he will defend himself in court if needed. Oleksiy Chernyshov, former deputy prime minister of Ukraine and a close ally of Zelenskyy, was identified in NABU recordings under the codename “Che Guevara.” NABU charged him with illicit enrichment, alleging he received about $1.2 million and nearly €100,000 through the money-laundering network.  Chernyshov, who has been under investigation in a separate corruption case since the summer, could not be reached for comment. He has largely stayed out of the public eye after being recalled from a work trip abroad earlier this year to face questioning. Another top official named was Ihor Myroniuk, an ex-adviser to Galushchenko and former deputy head of the State Property Fund. Myroniuk’s lawyer called accusations that his client illicitly enriched himself and was a member of criminal organization baseless. Dmytro Basov, former head of the Energoatom security department and identified as “Tenor” on the tapes, was also named. Basov’s lawyer said his client did not cause any financial harm to the state and that investigators have no case. Basov denied any wrongdoing during a court session Wednesday. IS THERE JUST A SINGLE INVESTIGATION? NABU and SAP actually have at least two major probes underway.  The new one, as noted above, focuses on the state nuclear power company, Energoatom. But there’s also another ongoing investigation into alleged graft involving inflated military procurement contracts, and more NABU raids on the defense ministry are expected in the coming days.  According to prosecutors, Rustem Umerov, former defense minister and current secretary of Ukraine’s State Security and Defense Council, was pressured to agree to buy cheaply made Chinese bulletproof vests for inflated prices in another case investigated by NABU. The state did not pay for the vests after poor performance in military testing. Umerov has not been charged and said he is innocent of any wrongdoing. Umerov admitted in a Facebook post that he met Mindich (yep, him again) to discuss the body armor contract, but it was terminated due to the product’s failure to meet requirements, no items were ever delivered, and he denied any pressure.  “Any attempts to link my work at the ministry of defense with the ‘influence’ of certain individuals are unfounded,” Umerov added. TELL ME MORE ABOUT ZELENSKYY’S BUSINESS PARTNER. According to NABU, the alleged ringleader in the purported energy sector kickbacks plot is Mindich, a co-owner of the president’s Kvartal 95 film production company.  Since Zelenskyy was elected in 2019 as president, Mindich has developed financial interests in several industries.  The 46-year-old is from the city of Dnipro and was a former business partner of Ukrainian oligarch Ihor Kolomoisky, who helped fund Zelenskyy’s successful presidential election campaign.  Mindich introduced Zelenskyy to Kolomoisky, who’s now in jail in Kyiv awaiting trial on embezzlement and fraud charges after being arrested by the Security Service of Ukraine in 2023. According to NABU, Mindich was tipped off and fled to Israel prior to being charged in the energy case. The agency is now investigating who might have alerted him.  Mindich could not be reached for comment. IS ZELENSKYY IMPLICATED? Not directly.  Zelenskyy welcomed the latest probes this week, saying in his regular nightly address to the nation that action against corruption is good.  In the summer, Zelenskyy’s office and the parliament in Kyiv tried to strip the independence of NABU and SAP and place them under the supervision of Ukraine’s prosecutor general, a political appointee.  The move, which coincided with signs that the watchdogs were probing presidential insiders, prompted the first major anti-government street protests since Russia’s full-scale invasion began in 2022. With the EU also urging a rethink, Zelenskyy reversed course.

KYIV — Top corruption watchdogs said they carried out dozens of raids Monday across Ukraine during an investigation into the energy sector. The National Anti-Corruption Bureau of Ukraine (NABU) and the Special Anti-Corruption Prosecutor’s Office (SAP) are probing top officials at Ukraine’s state energy companies, including nuclear energy operator Energoatom. Searches took place two days after Russia launched its largest attack yet against the Ukrainian energy system, including nuclear plants and electric substations, and hammered power operator Сentrеgenergo’s electricity-generating capacity. Lengthy blackouts are still occurring throughout the country, as authorities struggle to restore power, while Ukrainians question whether energy facilities were properly protected from Russian attacks. NABU said its 15-month investigation and 1,000 hours of wiretapping involving the bureau’s entire staff culminated Monday in 70 raids. Some of the wiretappings were from July, the same month Ukraine’s government and parliament tried to strip NABU of its independence and bring it under political control, citing Russian influence on the bureau — in a move that was later reversed following nationwide protests. NABU refused to reveal the names of the main suspects in the corruption probe, but said there were noted businesspeople and energy officials among the alleged perpetrators.  The main goal of the scheme they co-organized, according to NABU, was to obtain illegal benefits amounting to 10-15 percent of a state contract value — theoretically running into the millions of euros — from counterparts of Energoatom, including companies involved in building protective structures for energy infrastructure. Energoatom declined to comment due to the ongoing investigation.

Swiss-based trading house Gunvor on Thursday said it was withdrawing its offer to buy the international assets of Russia’s largest private oil firm after the U.S. said it would “never” approve the deal. “President [Donald] Trump has been clear that the war must end immediately,” the U.S. Treasury Department’s official X account wrote on X. “As long as [Russian President Vladimir] Putin continues the senseless killings, the Kremlin’s puppet, Gunvor, will never get a license to operate and profit.” “The Treasury Department statement is fundamentally misinformed and false,” Gunvor’s company spokesperson Seth Pietras, told POLITICO. “In the meantime, Gunvor withdraws its proposal for Lukoil’s international assets.” The excoriating comments come after Lukoil last week said it had accepted an offer by the multinational trading house to buy its international business after Trump announced sanctions against the energy company. Lukoil said the U.S. Treasury must approve the deal, before it is formally blacklisted on Nov. 21. In Europe, Lukoil holdings include two refineries in Bulgaria and Romania, a 45 percent stake in a Dutch fuel processing facility and around 2,000 petrol stations. Gunvor was co-founded by Swedish billionaire Torbjörn Törnqvist and Gennady Timchenko, one of Putin’s closest allies, in 2000 — and was once the biggest exporter of Moscow’s oil globally. In 2014, days before the U.S. imposed sanctions on Gunvor’s former co-owner following Russia’s annexation of Crimea, Timchenko sold his 43.6 percent stake in the trading house.  Lukoil said the U.S. Treasury must approve the deal, before it is formally blacklisted on Nov. 21. | Sefa Karacan/Getty Images Since then, the trading house has distanced itself from Russia. “Gunvor is and has always been open and transparent about its ownership and business, and has for more than a decade actively distanced itself from Russian trading, selling off its Russian assets, and has publicly condemned the war in Ukraine,” Pietras said. “We welcome the opportunity to ensure this clear misunderstanding is corrected.”

Czechia — one of Ukraine’s staunchest allies — is considering cutting the flow of much-needed arms and ammunition to Kyiv’s forces when its new government takes control in the coming weeks, according to a key leader of the incoming coalition. Filip Turek, the president of the right-wing populist Motorists party that this week signed an agreement to help form a national government, said that his country will “maintain NATO commitments and adherence to international law.” However, he went on, “it will prioritize diplomatic efforts to end the war in Ukraine and mitigate risks of conflict in Europe, shifting from military aid funded by the national budget to humanitarian support and focusing on Czech security needs.” The Motorists party was founded in 2022, and clinched six seats in parliament during last month’s nationwide election, making it a pivotal kingmaker in efforts by prime minister-designate Andrej Babiš and his populist ANO faction to form a government. Turek is under consideration to take on the role of foreign minister in the new administration. Babiš has previously publicly cast doubt on the future of a major program led by the current Czech government to provide tens of thousands of artillery shells to Ukraine, but has avoided publicly committing to a position since the election. Responding to the comments, first reported in POLITICO’s Brussels Playbook, outgoing Czech Foreign Minister Jan Lipavský said, “the limitation of Czech military aid to Ukraine is news that will surely bring great joy to Russian soldiers on the front line. Let’s consider it a Christmas gift from Babiš to Vladimir Putin.” According to Lipavský, whose broad center-right platform suffered defeat in October’s election, the new coalition’s policy statements “do not mention the word Russia even once,” and fail to face up to the Kremlin’s aggression. “The new government will be undermining the security of the Czech Republic,” Lipavský said. Turek added that the new Czech government would deal with Moscow in a manner “guided by pragmatic protection of national interests” and avoid “escalation that could endanger Czechia’s energy security or economic stability.” A “broader focus on sovereignty and non-intervention suggests a cautious, interest-based approach,” he said. While the Czech government may change the types of aid it provides to Ukraine, the EU’s main plan to finance Kyiv next year hinges on the use of Russian frozen assets currently held in Belgium. Brussels is in the process of deciding whether to support those measures, and it’s unclear whether Prague would oppose such a move. Babiš, tasked with forming a government within the next month, may face opposition from President Petr Pavel over Turek’s nomination. The likely next foreign minister has faced police investigation over inflammatory social media posts, some of which he has apologized for and others of which he has denied authorship. EU STANCE At the same time, Turek said Prague would prioritize being “a sovereign, confident member of the EU and a firm ally in NATO,” but simultaneously “resist further transfers of powers to Brussels and advocate for a union based on unanimity, mutual respect, and pragmatic policies that avoid overburdening citizens with regulations.” The former racing car driver, who until last month served as a member of the European Parliament and campaigned on an anti-Green Deal platform, branded eco-conscious policies “unsustainable,” calling for a reversal of the 2035 ban on the sale of cars with combustion engines and for emissions trading systems to be dropped altogether. “Real change requires Brussels to prioritize factory floors and family budgets over ideological agendas that only accelerate the offshoring of sophisticated European production to China,” Turek said, “where less efficient plants and long-distance shipping generate higher global emissions, paradoxically contradicting the very climate objectives Brussels claims to pursue.” Babiš will have to present his proposed list of ministers to Czech President Petr Pavel in the coming days before a vote of confidence in the new government can be held.