At the final State of the Union address of her first term as President of the European Commission, Ursula von der Leyen set a defiant tone in defending her European Green Deal against its critics and in condemning Chinese dominance within the clean energy space.

Touching on recent wildfires in Spain and Greece, von der Leyen warned that “this is the reality of a burning planet” before explaining that the Green Deal was “born out of a necessity to protect our planet”. She cited an increase in the number of clean steel factories in the past five years, which has risen from zero to 38. This in turn is now attracting more investment in clean hydrogen in the bloc than in the US and China combined, von der Leyen declared.

“We stay the course. We stay ambitious. We stick to our growth strategy. And we will always strive for a fair and just transition,” she said, adding that this will ensure a “fair outcome for future generations” to live on a healthy planet.

“The benchmark for success of the [speech] this week will be on whether von der Leyen will successfully manage to present a renewed vision for Europe’s green transition able to bridge political divides against climate change and drive further action,” Elisa Giannelli, programme lead for EU politics and governance at climate think tank E3G, said in a statement.

Focus within the portion of the speech dedicated to the Green Deal fell on the ramp-up of electric vehicles (EVs), the success of the wind industry, solar power and various acts such as the Net-Zero Industry Act and the Critical Raw Materials Act, which have been passed recently to strengthen the bloc’s response to the climate crisis.

Clap back against Chinese clean energy dominance

Turning to perceived foul play from China regarding its clean energy subsidies, von der Leyen said: “We have not forgotten how China's unfair trade practices affected our solar industry,” adding that many businesses have been “pushed out by heavily subsidised Chinese competitors”, with some forced to declare bankruptcy.

Regarding China’s dominance in the EV supply chain, von der Leyen said that global markets are now “flooded” with cheaper Chinese electric cars, whose prices are kept “artificially low” by state subsidies. Yielding to months of pressure by France and its proxies, she announced that the Commission will launch an anti-subsidy investigation into EVs manufactured in China. This announcement won quick support from Manfred Weber, leader of the EPP.

“We don’t want to see Chinese electric vehicles benefitting from our climate policies,” Weber told MEPs after von der Leyen’s address. “We have to activate our trade defence instruments to avoid another solar panel attack,” he added, referring to a trade war between China and the EU that devastated Europe’s solar panel industry more than a decade ago.

“Europe is open for competition. Not for a race to the bottom,” von de Leyen said, but caveated her defiance with the concession that lines of communication and dialogue with the Asian nation must be “kept open”, perhaps in an attempt to maintain diplomatic relations ahead of the EU-China summit scheduled for later this year.

Walburga Hemetsberger, CEO of SolarPower Europe, said in an email statement: “It was good to hear President von der Leyen’s commitment to critical industry made in Europe, and that Europe will do whatever it takes to keep its competitive edge.

“This promise must translate into action. Solar project developers face inflation-driven headwinds. Europe’s solar manufacturers are at risk of bankruptcy.

“We have the foundation of the EU Solar Strategy. We have the new European Solar PV Industry Alliance with the goal of reshoring 30 GW of solar manufacturing in 7 years.

“Europe is betting on solar to drive the energy transition. That means we need continued and decisive action to support grids, accelerate permitting, expand the solar workforce, and to urgently address today’s crisis in the solar supply chain.”

The State of the Union speech comes ahead of the European Parliament elections, due to be held in June next year. However, von de Leyen is yet to announce whether she will run for a second term.

Elisabetta Cornago, senior research fellow at the Centre for European Reform, said in a press statement: "In the last State of the Union speech of her term, Commission President Ursula von der Leyen will likely take stock of how the EU managed to navigate the energy crunch and sharply reduced import dependence on Russian oil and gas. But as the backlash against the Green Deal becomes an ever-present topic in the electoral campaign, many will try to gauge from her speech how committed she is to the EU’s 2040 and 2050 climate targets.”