Regulatory Power and Multilateralism: EU Institutional Tensions in Climate Diplomacy

The EU’s climate diplomacy has traditionally combined multilateral engagement with efforts to shape global governance. Increasing geopolitical competition, however, complicates this approach. With the European Green Deal, the EU has expanded the use of regulatory instruments, most notably the Carbon Border Adjustment Mechanism (CBAM), to steer climate action beyond its borders. While existing literature often treats these regulatory and multilateral impulses as mutually reinforcing, the two increasingly pull in different directions in practice. As the EU leans more heavily on regulatory approaches in response to geopolitical turbulence, the tension between setting standards alone and shaping coalitions together has become harder to ignore. This paper examines how internal institutional dynamics shape the EU’s evolving approach to climate diplomacy in an era marked by power politics. It asks: Why do EU institutions differ in how they perceive and manage tensions between regulatory tools and multilateral climate cooperation? The research focuses on the period from the launch of the European Green Deal in 2019 to the present. It draws on semi-structured interviews with officials in DG CLIMA, DG TAXUD, and other relevant bodies, complemented by policy documents. Preliminary evidence suggests that EU institutions read the rise of regulatory instruments through different organisational lenses. Some view tools such as CBAM as extensions of the EU’s climate ambition abroad; others see them as complicating building and maintaining international coalitions. These divergent readings make coordination more difficult and contribute to an inconsistent external climate posture. By tracing how EU institutions interpret and navigate the tensions between regulatory power and multilateral practice, the paper contributes to debates on EU climate governance in turbulent times, internal fragmentation, and the prospect for sustaining the Union’s global climate leadership in the face of heightened geopolitical competition.