The trade dispute between the United States and China has escalated with a fresh wave of tariffs, and its effects are being strongly felt across the global energy sector. In this increasingly uncertain context, Europe finds itself in a complex position: While it could benefit from the conflict by becoming a reliable partner for China, it also risks severe setbacks in its clean energy transition.

Speaking to Strategic Energy Europe, Tasso Paes Franco Filho, Portugal Account Manager at Sammy Free, analyses the geopolitical implications of this rising tension. He considers it unlikely that Beijing will impose direct tariffs on the European Union at this time, but warns: “If the EU steps up its alignment with Washington or imposes its own restrictions, a tariff response from Beijing cannot be ruled out.” He also points out that “China has already shown it responds strategically to unilateral trade measures.”

Direct Blow to the Renewable Supply Chain

From an industrial perspective, solar and wind energy could face severe short-term impacts due to their heavy reliance on Chinese components. China’s recent decision to impose up to 34% tariffs on US energy products, as reported by Strategic Energy, highlights a retaliatory policy that may extend to other nations imposing restrictions.

“Tariffs may slow the pace of new renewable energy projects, particularly solar, which are heavily dependent on China’s value chain,” Paes Franco Filho stresses. This could increase costs, delay logistics and cause investment decisions to stall.

A Strategic Window for Europe

From Europe’s standpoint, the conflict may also offer a strategic opportunity. “Europe can position itself as a more stable partner for China in key sectors,” says the executive, especially if the US maintains its restrictive trade stance. Chinese companies, facing new barriers in the US market, may redirect capital and technology to Europe.

However, this advantage carries geopolitical risks. “The EU risks getting caught between two feuding powers,” he cautions. As global tensions rise, European countries could be forced to take sides, heightening diplomatic tensions and potentially jeopardising strategic alliances.

Fossil Fuels: Temporary Rebound in the Energy Mix?

One of the clearest effects of this situation is the rising cost of essential components for renewable infrastructure. “What most harms Europe is the cost of components, as it largely relies on Chinese imports for its energy transition,” notes the Sammy Free executive.

In this scenario, fossil fuels like oil could temporarily regain ground. “Fossil sources may gain traction due to their immediate availability, especially in markets already under cost or energy security pressure,” says Paes Franco Filho.

However, he stresses that this rebound is likely to be short-lived as Europe’s climate policies continue to guide the decarbonisation path.

Financial Uncertainty and Green Investment

The recent stock market downturn in the US adds another layer of complexity to the global context. Paes Franco Filho observes: “We may see greater investor caution, particularly in projects reliant on private finance.” Heightened risk perception and financial instability create an environment in which capital becomes more selective, directly impacting large-scale renewable ventures.

Still, he highlights Europe’s structural resilience: “The renewable energy sector in Europe has a solid foundation, strong political support, clear regulatory frameworks and a social and environmental push that drives the energy transition.”

The continent has already shown strength in the face of recent crises, including the pandemic and the war in Ukraine.

Beyond the Conflict: Strengthening Industrial Autonomy

Finally, Paes Franco Filho underscores: “The energy transition is not a luxury—it is a strategic necessity,” and sees this global tension as a potential catalyst for reinforcing Europe’s industrial autonomy. Strengthening local production and reducing reliance on foreign inputs will be key to securing climate goals and maintaining Europe’s leadership in clean energy.