Europe will face a more challenging America in the coming years, but that should not deter efforts to strategically engage on clean energy technologies where possible.
Alongside cooperating with Washington on shared tech priorities like geothermal energy, European policymakers can selectively forge relationships with relevant subnational institutions while developing policies to absorb U.S. firms.
Ironically, U.S. President Donald Trump’s dismantling of subsidies might open the door to a transatlantic tech transfer—an unexpected answer to the competitiveness concerns of former European Central Bank president Mario Draghi. This pragmatic approach could help Europe onshore climate tech that supports the Clean Industrial Deal, and even implement a “reverse Inflation Reduction Act (IRA).”
The second Trump administration’s energy strategy is more ideological than the first’s and more likely to reshape the American energy transition.
The administration has frozen billions of dollars in clean energy funding. Some officials deny climate science outright, while others argue that limiting the use of fossil fuels—and the growth they generate—poses a greater threat than rising temperatures. Their stance rejects low-carbon technologies like hydrogen, carbon removal, and low-emissions natural gas—a break from past Republican norms and even the position of some American energy majors.
U.S. officials are centering their energy platform on baseload power for artificial intelligence and industrial onshoring—favoring coal, gas, nuclear, geothermal, and hydro power over variable renewables. Despite their strong opposition to solar and wind energy, solar may endure because of price competitiveness.
The picture will be clearer this summer as the fate of the IRA is determined. Yet, contradictions loom: Trump’s push to rescue coal could undermine favored technologies like natural gas and geothermal, while repealing electric vehicle (EV) subsidies would weaken battery demand and sabotage the administration’s push for mineral production. The coherence of the carbon dominance agenda remains in question.
European policymakers should prioritize engaging the Americans on clean firm technologies like nuclear and geothermal. With wind and solar power sidelined, nuclear and especially geothermal energy should take center stage.
A nuclear cooperation framework already exists, with U.S. reactor plans in Poland and Romania and supply-chain alignment with France. But these are long-term elements and are unlikely to impact industrial capacity. Amid Germany’s shifting views on nuclear power and the EU’s new plans to expand this source, this track may serve more as symbolic diplomacy than as an industrial strategy.
However, engaging the United States on next-generation geothermal power may yield quicker political returns. New geothermal technology is advancing rapidly, including in Germany, with U.S. firms unlocking a step change in potential with their shale-era drilling expertise. The International Energy Agency estimates geothermal energy could now supply 15 percent of global power by 2050, while helping decarbonize heating. Washington may be pleasantly surprised to find European interest in incentivizing its firms to drill across the Atlantic.
A transatlantic geothermal dialogue would strengthen European security and climate goals. Rich potential exists across Spain, France, Italy, Hungary, Romania, and, especially, Germany. Italy, which is politically aligned with Washington, could be a useful entry point.
For Europe, new geothermal plants could deliver continuous clean power while helping decarbonize the continent’s 19,000 district heating units. Although Europe has lost its solar manufacturing industry, Italy is home to three of the five geothermal turbine manufacturers, a low-carbon industrial advantage that is often overlooked.
Helping American industry scale up next-generation geothermal energy could also give the United States a durable, politically viable off-ramp for its oil and gas industry—and a long-term path for Americans to eventually reenter climate discourse with a low-carbon industrial opportunity.
Even if geothermal or nuclear talks help build goodwill or even new business, they will not satisfy Trump’s fixation on trade deficits. Washington is likely to demand greater European purchases of U.S. liquefied natural gas—which already supplies half the bloc’s gas market. To balance this dynamic, Europe could elevate American battery storage exports as a flagship of transatlantic trade.
Novel long-duration systems now being scaled up in the United States—some of which are already arriving in Ireland and Germany—offer twelve hours or more of backup capacity. They are critical for Europe’s renewables-heavy grid and as a hedge against Chinese battery dominance.
During Trump’s first term, U.S. states and cities helped maintain climate cooperation abroad. But with stretched budgets and democracy crises at home, today’s liberal states may not have the capacity they showed in 2017. Subnational engagement should be strategic and focus on states making tangible, green industrial progress in areas where knowledge sharing is of genuine interest.
Science diplomacy and exchange programs remain valuable for targeted sectors where low-carbon breakthroughs would benefit European energy security. France’s interest in unlocking geologic hydrogen—a cheap, zero-carbon fuel source within the Earth—could align well alongside U.S. research labs with deep subsurface expertise and American firms already drilling for these molecules. Collaboration here could ease Europe’s hydrogen cost crisis in the long term. Meanwhile, the Salton Sea lake in California and the Upper Rhine Valley between France and Germany host unique geothermal lithium projects—promising the cleanest lithium supply and potential to scale that could benefit from shared research.
Finally, Europe should consider strategies to absorb U.S. clean tech firms, many of which are struggling under Trump’s policy shift. Call it a “Reverse IRA”: What once drew capital away from Europe now offers the EU stranded innovation that it could embrace and adopt. Europeans should develop strategies to onshore production processes from U.S. firms on European soil.
A myriad of companies from the era of former U.S. president Joe Biden—now near or at commercial scale—are crucial to Europe’s green goals, from clean steel and grid technologies to next-generation EV batteries. Firms that focus on industrial decarbonization and advanced batteries should top the list given their importance to economic and national security. Battery technologies like silicon anode or lithium-sulfur reduce mineral risk and enhance performance, and they can often be built in Europe’s existing battery factories. Alternative steel, cement, and clean-heat processes can also deliver low-carbon products, some without hydrogen or carbon capture.
Europe will not change the course of U.S. climate politics, but it can shape some of the terrain. By staying pragmatic and focused on technologies that serve both security and decarbonization, Europe can protect its climate ambitions—and keep the door open to future cooperation.
