Should Europe reach climate neutrality together – or country by country? The cost difference is tiny

Should Europe reach climate neutrality as one integrated system – or should every country reach net zero on its own?

A new study suggests that the choice may matter far less than many policy-makers and researchers have assumed.

“It was quite a surprise for us that the difference was so little,” says Marta Victoria, who works on system modelling at the Novo Nordisk Foundation CO₂ Research Center and is an Associate Professor at the Technical University of Denmark in Kongens Lyngby. “Initially we thought that requesting every country to become carbon neutral was going to be very expensive.”

Instead, the researchers found that making each country responsible for its own carbon balance increases total system costs by only about 1.4% – a surprisingly small difference for such a major policy change.

“What we see in many energy-system models is that the overall cost of decarbonisation is driven mainly by how much clean energy you build in total – not so much by exactly where emissions reductions happen geographically.”

Using a detailed computer model of Europe’s energy system, the researchers compared two scenarios: one in which Europe meets a shared CO₂ target and another in which every country must reach net zero on its own.

The result was not only a small cost increase but also a shift in where key technologies are built and how carbon moves across the continent – including the need for a substantial cross-border CO₂ transport network and greater investment in renewable electricity and direct air capture.

Why climate neutrality becomes uneven in economic models

The European Union has committed to becoming climate neutral by 2050. But while the target is set at the European level, most decisions about how to reach it are still made nationally.

That creates a mismatch with the way many energy system models are usually built.

“When system models do that, what we usually see is that the result is very inhomogeneous,” Victoria says. “We have regions that are contributing a lot to capturing CO₂ because it is easier for them – and then we have other regions that are not contributing that much.”

In large-scale optimisation models, emissions tend to be reduced and carbon removed wherever they are cheapest. Countries with abundant wind, solar or biomass resources therefore end up removing much more carbon than others.

“Countries around the North Sea have good access to wind and solar, so it is cheaper for them to produce electricity,” Victoria explains.

Those same regions are also well placed to remove carbon – either because wind and solar electricity can power technologies that pull CO₂ directly from the air or because biomass can be used together with carbon capture and storage.

By contrast, more central industrial countries may have large legacy emissions from industry, shipping and fossil infrastructure.

When economic optimisation meets political reality

In a purely cost-optimised continental model, carbon is therefore removed wherever it is cheapest – meaning that some countries end up doing much more of it while others do less.

“This is somehow difficult to implement or to defend,” Victoria says. “In Europe, we are committed to attain carbon neutrality as a European Union. And then the governments, the countries, are the ones deciding the strategy. So I do not think any country is thinking about overachieving for the others.”

This tension between economic optimisation and political reality became the starting-point for the study.

“We see this clear misalignment between the economic optimum and how different actors in reality are thinking about the future,” Victoria says. “And we thought, well, okay, how can we reconcile these two visions?”

Testing a different assumption: what if every country must reach net zero?

Rather than asking which approach is morally fairest, the researchers asked a more practical question: what actually happens to Europe’s energy system if climate neutrality is implemented country by country instead of collectively?

“We try to understand how different technologies can be put together to solve the big puzzle,” Victoria says.

To explore that puzzle, the researchers used an open-source modelling framework called PyPSA-Eur, which simulates the European energy system in great detail and enables researchers to test how various policy choices shape future energy infrastructure.

This puzzle involves capturing CO₂ from factories or directly from the air, transporting it across borders, turning it into fuels or materials – or storing it permanently underground in rock formations.

A model that calculates the cheapest energy system hour by hour

The model represents electricity generation, heating systems, land transport, aviation, shipping and industry – and calculates which technologies should be built and how they should operate hour by hour across Europe.

“We have a very large optimisation model,” Victoria explains. “We try to find the optimal combination of technologies installed in different locations and operated at different hours of the year.”

Because renewable energy varies from hour to hour and from place to place, the model needs detailed information across Europe and throughout the year.

“It is important that we capture how good the wind is – not only in Denmark but in different locations,” she says. “The system is changing from hour to hour.”

Two political choices, one energy system

The researchers then compared two policy scenarios.

In one scenario, Europe operates under a single shared CO₂ constraint. In the other, each country must meet its own net-zero target.

“What we changed was not the physics of the system but the societal constraint,” Victoria says. “What if we do not ask the whole continent but ask every country to become carbon neutral?”

The model then simulates how the entire European energy system would operate hour by hour across the continent.

Capturing the full carbon chain

For Victoria, capturing that entire chain was essential.

“You want to capture CO₂ where you have good access to wind and solar and move it to the places where you can sequester it underground.”

Because of this complexity, the model runs on high-performance computing systems and translates real-world constraints – from weather patterns to land availability and policy targets – into mathematical equations.

“Ultimately, it is an exercise of representing mathematically many physical limitations and many societal desires in equations,” Victoria says.

Once those relationships are encoded, the model can calculate how the entire system evolves under different policy choices – including total system costs, technology investments and cross-border CO₂ flows.

“What the model enables us to do is explore how the whole system might evolve under different political choices,” Victoria says.

How the system behaves when Europe acts collectively

When Europe is treated as a single system with one shared CO₂ target, the model distributes emission reductions and carbon removal across countries in the most cost-efficient way.

In practice, this means that some countries would remove more carbon than they emit, while others would still have residual emissions that are balanced elsewhere in the system.

The picture changes when each country must meet its own net-zero target. In that case, every country has to balance its own emissions and carbon removal.

The researchers initially expected the costs to rise significantly.

“It was quite a surprise for us that the difference was so little,” Victoria says. “Initially we thought that requesting every country to become carbon neutral was going to be very expensive.”

Why forcing every country to reach net zero barely raises the cost

Across Europe as a whole, the model shows that total system costs increase by only about 1.4%.

“At the European level, the total cost hardly changes. But inside the system there are much bigger shifts, because different countries end up doing different parts of the decarbonisation.”

Countries that previously relied on others to offset part of their emissions would face significantly higher costs if they had to remove their own carbon, while countries that previously carried a larger share of carbon removal would see their costs fall.

“For countries that under the previous solution were just emitting more than they captured because they were counting on other countries to compensate them, the cost increase can be more significant,” Victoria says. “For example, Germany has a cost increase of 13%.”

The policy change also alters how technologies are deployed across Europe.

Instead of concentrating renewable energy and carbon removal in regions with the best natural resources, the system spreads these technologies more broadly across Europe.

In other words, a climate-neutral Europe would not only move electricity across borders – it would also move carbon.

“In a carbon-neutral Europe, it is not only electricity that is flowing around, but it is also CO₂,” Victoria says.

The politics of burden sharing in a climate-neutral Europe

For Victoria, the result matters not only because it changes the economics of decarbonisation but because it makes the political reality of climate neutrality easier to discuss.

If some countries are naturally better suited to remove carbon – because they have stronger wind resources, more solar power or suitable storage sites – they may end up contributing more to the common European Union effort.

“If we end up in a situation where some countries are capturing more than they emit, they are contributing more to the common good,” she says. “How are we going to balance that?”

The study therefore highlights a broader challenge for Europe’s climate strategy: how to share the burden of decarbonisation between countries with very different resources and industrial structures.

What researchers still need to understand about carbon removal

The study also raises questions that researchers are only beginning to explore.

One is how resilient a future energy system dominated by wind and solar power will be during periods with little wind or sunshine.

Another is how different carbon removal technologies – such as direct air capture, bioenergy with carbon capture or biochar – might scale up in practice.

Understanding these pathways is essential, Victoria says, because carbon removal will almost certainly play a central role in reaching climate neutrality.

For researchers like her, the goal is therefore not only to predict the cheapest energy system but also to help policy-makers and technology developers understand what kinds of solutions might realistically work.