BT-REQ-4413 EU-UK Renewables thought leadership V1 RL V6 (2) - Flipbook - Page 2
How new trade and supply chain rules are shaping European renewable
energy projects
At a glance:
Ambitious net-zero goals, persistent China
dependence: The EU and UK continue to push
aggressive decarbonization and energy security
agendas, but large-scale renewable projects remain
heavily reliant on Chinese components.
Heightened trade, supply chain, and national
security scrutiny: Governments are tightening
oversight through procurement rules, tradedefense measures, ESG and forced-labor regimes,
and expanded FDI screening – raising compliance
costs and increasing execution risk for projects with
foreign suppliers or investors.
Resilient deal structuring is essential:
Developers and investors must integrate supplychain diligence, regulatory risk mapping, and
contractual flexibility to keep projects viable.
From floating wind farms in the Celtic Sea to rooftop
solar arrays in Germany, today’s European renewable
energy projects embody the region’s ambitious push
to scale back greenhouse gas emissions and rewire
its economy for a low carbon future. Such projects
also make sense from an energy security perspective:
harnessing renewables helps curb dependence on
imported fossil fuels, like Russian oil and natural gas.
Yet despite those imperatives, renewable initiatives in
the European Union (EU) and United Kingdom (UK)
face an increasingly complex landscape.
EU and UK renewables: Key regulatory
challenges
Decarbonization remains a priority across Europe.
Substantial emissions reduction progress in both the
EU and the UK has been bolstered by policies like the
EU’s Green Deal Industrial Plan and
Net-Zero Industry Act (NZIA) and the UK’s
Invest 2035 industrial strategy, all of which seek to
scale up clean-tech manufacturing capabilities and
support domestic competitiveness.
While the policy push creates opportunities
for investors, those goals – which often involve
reducing dependence on China – also present nearterm complications. Chinese suppliers currently
dominate many parts of the renewables market, from
photovoltaic panels to wind modules to battery cells.
The bigger the project, the more the economies of
scale push developers back to Chinese components.
At the same time, ESG measures aimed at combatting
human rights abuses are increasing scrutiny on
renewable supply chains. National security regimes
are doing the same for foreign partners involved
in those projects – putting developers, investors,
and joint ventures at risk of enforcement actions as
jurisdictions step up FDI screening and
subsidy control frameworks.
The core challenge for investors and developers:
balancing cost, trade, and regulatory pressures
related to the components and technology needed to
build renewable projects at scale. For instance, large
wind and solar projects continue to rely heavily on
Chinese suppliers even as regulators tighten oversight
of renewable supply chains and foreign players.
To mitigate risk, projects must factor those legal and
regulatory impacts – from Foreign Direct Investment
(FDI) regimes to domestic procurement requirements
– into planning from day one. That means partnering
with suppliers and investors to ensure compliance,
and structuring deals and contacts for flexibility in
the event of sudden geopolitical or trade upheaval.
On the upside, foreign partners like the Chinese
players who dominate renewable supply chains
can gain a competitive advantage in the EU and
UK markets by demonstrating their investment in
compliance and understanding of regional regulatory
requirements.
In what follows, we’ll outline key EU and UK
considerations for renewable developers and
investors, as well as guidance for navigating the
evolving trade and political environment.
Hogan Lovells has extensive experience in the
international trade sector, a client-oriented
approach and a great understanding of
business objectives with a focus on specifics
recognized within the industry.”
- Client testimonial, International Trade/WTO,
Chambers Global, 2026
