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In the EU, COVID-19 and associated policy responses led to economy-wide disruptions and shifts in services demand, with considerable energy-system implications. The European Commission's response paved the way towards enhancing climate ambition through the European Green Deal. Understanding the interactions among environmental, social, and economic dimensions in climate action post-COVID thus emerged as a key challenge. This study disaggregates the implications of climate ambition, speed of economic recovery from COVID-19, and behavioural changes due to pandemic-related measures and/or environmental concerns for EU transition dynamics, over the next decade. It soft-links two large-scale energy-economy models, EU-TIMES and NEMESIS, to shed light on opportunities and challenges related to delivering on the EU's 2030 climate targets. Results indicate that half the effort required to reach the updated 55% emissions reduction target should come from electricity decarbonisation, followed by transport. Alongside a post-COVID return to normal, the European Green Deal may lead to increased carbon prices and fossil-fuel rebounds, but these risks may be mitigated by certain behavioural changes, gains from which in transport energy use would outweigh associated consumption increases in the residential sector. Finally, the EU recovery mechanism could deliver about half the required investments needed to deliver on the 2030 ambition.

Since the beginning of the COVID-19 pandemic and its economic impacts, scientists and policymakers alike have been advocating for green recovery packages focusing on clean energy technologies, to align economic recovery with climate change mitigation. In this study, we use three energy-economy models combined with portfolio analysis to estimate the emissions and employment benefits of a potential allocation of announced recovery packages towards clean energy projects, in six major emitting regions: Canada, China, EU, India, Japan, and USA. Despite trade-offs and regional differences, we find potential technology portfolios that both reduce emissions and increase employment across all regions and models. Solar PV is the dominant technology for achieving both emissions cuts and employment gains in most countries, while optimal packages also include funds for other low-carbon technologies. The selected packages significantly contribute to achieving NDC objectives and reducing pandemic-driven unemployment in the EU, China, and Canada. In USA and India, the proposed packages are too small to make a significant contribution. We find strong model structure-driven differences in outcomes, confirming the relevance of applying diverse models to avoid false precision in outcomes.