Challenges of Energy Policy within Decarbonisation: Evidence of the European Union

Decarbonisation is a serious and comprehensive process of reducing carbon emissions that affects all areas of life, especially energy policy. This study aims to analyse the role of renewable energy sources, electricity prices and the level of economic development on final energy consumption and greenhouse gas emissions. For this purpose, a panel data analysis with fixed and random effects was carried out for 27 EU Member States over the period 2019–2009. The results show that, as economic activity increases, energy consumption also increases, but GHG emissions per capita decrease. The use of renewable energy sources reduces GHG emissions per capita but also has the effect of decreasing final energy consumption. Electricity prices showed no statistically significant relationship with total energy consumption or GHG emissions per capita. Decarbonisation definitely affects the energy strategy by encouraging the use of renewable energy sources in all sectors—transport, household and industry. Renewable energy sources, especially in electricity production, will be the backbone of energy strategies in the EU Member States.