Will the European Green Deal enhance Europe’s security towards Russia? A political economy perspective

The European Green Deal is a set of policy initiatives set by the European Commission with the aim of making the European Union climate neutral in 2050. The Deal is credited with many virtues by its proponents, and in particular that it would reduce geopolitical disputes with Europe’s main supplier of energy, Russia. The nascent literature on energy transition is primarily focused on its economic costs and benefits, and on its contribution to energy security; but it has so far left unaddressed the question of the transition’s military consequences. To address that question, our paper adopts a political economy perspective by looking at how a sizeable drop in the energy revenue, which would result from the successful implementation of the Deal, is likely to affect the intraelite competition underway in Russia. We model that competition by means of a Tullock contest in which the energy revenue may be allocated by the sole winner to the provision of private goods or of club goods. We show that the Deal would favour the currently ruling elite group’s efforts at winning the contest. Given that this elite would thus control energy revenue and would spend it on military investments intended at maintaining it in power, the Deal could have adverse security consequences for Europe. The paper concludes by underlining the importance for the Deal’s success to factor in its unintended geopolitical consequences.