Climate action across the Atlantic: A shared agenda for the future

Looking ahead, where could transatlantic cooperation make the biggest difference in addressing climate change, despite and beyond the current US administration? 

Across the Atlantic, the United States and Europe often pursue different approaches to energy and climate policy. Yet many of today’s policies have been shaped by decades of exchange, adaptation, and mutual learning.

Ahead of the FSR–MIT CEEPR Annual Conference on Energy and Climate Policy, this series brings together experts from both sides of the Atlantic to explore some of the defining questions facing the energy transition.

In this instalment, experts from MIT CEEPR and the Florence School of Regulation reflect on where transatlantic cooperation can have the greatest impact in advancing climate action in the years ahead.

From the US: Joshua Hodge, Executive Director, MIT CEEPR

Even with a federal administration in Washington stepping back from climate action, ample foundations remain for transatlantic cooperation – and in some areas, the case for working together may have even grown.

The most immediate opportunities lie where climate and economic interests converge. Europe and the United States face a shared challenge in critical raw materials and resilient supply chains, where dependence on a single dominant supplier carries real strategic risk. Coordinating diversification, common standards, and industrial competitiveness is not only good climate policy, but an increasingly important factor in economic security. Much of this work can also proceed below the federal level: US states and municipalities, many with ambitious climate commitments of their own, remain willing and capable partners.

But there’s a quieter form of cooperation that deserves more attention: research and academic collaboration. Much of Europe’s early climate policy was shaped by American innovations. Today the flow increasingly runs the other way – Europe’s sustained implementation of instruments like emissions trading and carbon border measures has generated a wealth of real-world data and hard-won lessons that can inform policy design everywhere. Strengthening joint research projects and the institutions that house them is one of the most durable investments we can make.

That conviction is also why the Florence School of Regulation and MIT’s Center for Energy and Environmental Policy Research have built a lasting partnership, anchored by an annual conference that turns this shared interest into shared work.

From Europe: Alessia Casamassima, Research Associate, FSR Climate Area.

The real leverage lies in areas where the US and Europe can shape global systems rather than just reduce their own emissions. One of the most important is heavy industry: steel, cement, and chemicals. If transatlantic partners align standards for what counts as “green” production and coordinate mechanisms like carbon border adjustments, they can effectively set the rules for global trade. Exporters will have to decarbonise to stay competitive. It’s less about internal policy and more about external influence.

Even if political priorities shift within the EU, the combined market size and regulatory power of the transatlantic bloc remain enormous. That’s why coordination on clean tech supply chains is another critical area. By jointly investing in critical minerals and manufacturing capacity, they can reduce dependency risks and accelerate deployment of technologies like batteries and renewables.

The energy system is another high-impact domain. Both sides are dealing with the same bottleneck: grids. Cooperation on offshore wind standards, smart grid technologies, and resilience can dramatically speed up the energy transition. Europe brings experience in cross-border grid integration, while the US contributes scale and innovation. Together, they can set templates that others follow.

Finance often comes up in climate discussions. Aligning carbon markets, ESG standards, and climate finance frameworks could mobilise capital at a much larger scale. If transatlantic partners create a coherent financial architecture, it tends to become the global benchmark. That’s particularly important for funding transitions in emerging economies.

Finally, another crucial point is innovation. Joint R&D is essential for technologies that aren’t yet commercially viable: green hydrogen, carbon capture, and long-duration storage. Coordinated funding and shared demonstration projects can cut years off development timelines and avoid duplication.

However, there are also challenges to overcome. The main one is policy misalignment, especially around industrial subsidies and trade. But instead of trying to fully harmonise policies, which is politically difficult, a more realistic approach is mutual recognition and coordinated incentives.

Equally important is the social dimension of the transition, which will ultimately determine its political durability. Decarbonisation is not just a technological or economic shift; it reshapes labor markets, regional economies, and cost structures for households. Transatlantic cooperation could have significant leverage in setting standards for a “just transition.” This includes aligning approaches to workforce reskilling in carbon-intensive sectors, supporting regions disproportionately affected by industrial decline, and ensuring that energy affordability remains central to policy design. Failure to address distributional impacts risks backlash that could stall progress on both sides of the Atlantic. In that sense, social policy is not ancillary to climate cooperation: it is a core enabler of its long-term success.

Looking ahead to Florence

But the discussion doesn’t end here. These are some of the questions that participants will continue exploring during the FSR–MIT CEEPR Annual Conference on Energy and Climate Policy in Florence this October, where researchers, policymakers, and industry representatives will discuss how cooperation across the Atlantic can continue to shape the future of energy and climate policy.