Brussels – The European Commission is opening the way for greater freedom and flexibility in spending for Member States that need to strengthen their energy security and accelerate the phase-out of fossil fuels. The EU executive has adopted a notice clarifying how to extend the National Escape Clause, NEC—already used to allow countries to temporarily increase defence spending without automatically falling foul of European fiscal rules—to these measures. This possibility had been announced on 3 June in the European Semester 2026 Spring Package.
The decision comes in the context of the energy crisis linked to the conflict in the Middle East and aims to make the European energy system more resilient. The objective is to enable governments to fund measures that reduce dependence on fossil fuels, strengthen supply security, and accelerate the energy transition. Potentially eligible measures may include national initiatives to reduce energy demand, develop renewables, or increase electrification, as the European Commission has already indicated in its overview of national emergency measures.
However, this is not a blank cheque: this flexibility will have specific limits. Only budgetary measures decided after 28 February 2026, financed at national level and having a direct impact on public finances, will be eligible for this clause. The measures must also be designed to achieve the greatest possible impact while minimising the cost to public finances. The European Commission will assess on a case-by-case basis whether individual measures meet the requirements.
The additional margin will, however, be limited by the caps set by the new European fiscal rules. The overall deviation from the net expenditure path recommended by the Council may not exceed 1.5 per cent of GDP. Within this limit, the flexibility specifically earmarked for energy security will be capped at 0.3 per cent of GDP per year and 0.6 per cent cumulatively. This option will be available for the period 2026–2028.
The European Commission thus aims to prevent greater spending flexibility from becoming a risk to public-finance sustainability. Any amounts that exceed the prescribed limits will continue to be assessed in accordance with the EU’s standard fiscal surveillance procedures. The national clause, set out in Article 26 of Regulation 2024/1263, already allows Member States to deviate temporarily from their expenditure path when exceptional circumstances beyond their control will significantly impact public finances, provided that this does not jeopardise medium-term fiscal sustainability.
The ball is now in the Member States’ court; they may formally request that the clause be extended to cover energy security as well. In their applications, they must provide an initial list of the measures they intend to fund and the associated estimated costs. The Commission will examine the applications and, provided the relevant criteria are met, may recommend that the Council approve them.
English version by the Translation Service of Withub
