Governing the Green Transition: Institutional Structures and Policy Choices

Climate governance has increasingly expanded beyond the domain of environmental regulation to encompass industrial strategy, trade policy, and economic security concerns. In this context, the electric vehicle (EV) sector has emerged as a key site where climate ambition, market integration, and geopolitical competition intersect. The European Union (EU), while maintaining strong commitments to decarbonisation, has adopted a governance approach that relies predominantly on regulatory standards, coordination mechanisms, and procedural instruments rather than large-scale, centralised industrial intervention. This paper examines how institutional and governance structures shape the EU’s policy responses in the EV sector. It explores the relationship between multi-level governance arrangements, fiscal and administrative fragmentation, and the selection of policy instruments in the context of green industrial transformation. Rather than evaluating policy outcomes in terms of success or failure, the analysis focuses on the logics through which certain governance tools become more feasible and politically sustainable than others within the EU system. Empirically, the paper traces key developments in EU EV-related policy between 2017 and 2025, including changes in regulatory frameworks, coordination initiatives, and trade-related measures. It highlights how these instruments interact with existing market structures and international production networks, generating patterns of adjustment and adaptation rather than abrupt structural breaks. By situating EU EV governance within broader debates on climate governance and political economy, the paper contributes to discussions on how institutional arrangements condition policy choices under conditions of uncertainty and external pressure. The findings speak to ongoing debates about the governance of green transitions in complex and contested political–economic environments.