(Bloomberg) -- This weekend’s European Union elections marked the end of the bloc’s greenest parliament ever after concerns over everything from climate policies to migration gave the populists a boost.

The Greens, whose rise five years ago helped the 27-nation bloc embrace the world’s most ambitious climate strategy, emerged in all but tatters from a ballot that ended on Sunday. Climate-friendly liberals also suffered a massive blow from voters while far-right nationalist parties strengthened their position in countries from Germany to Italy.

The results won’t topple the Green Deal. The mainstream parties that supported the sweeping plan to decarbonize the bloc’s economy retained a majority. But they risk weakening the resolve of governments when they turn the policy into reality through measures that will affect households from Lisbon to Helsinki. There will also likely be some bickering among new lawmakers over future measures to meet the net zero target.

“The Green Deal will stay alive but not necessarily kicking,” said Maximo Miccinilli, head of energy and climate at the consultant firm FleishmanHillard EU. “The EU should be able to defend measures that were already adopted for this decade but proposals for a new goal for 2040 will be a huge test for the new parliament.”

Governments across the continent and the EU leadership in Brussels have already come under pressure to soften their ambition as discontent over green policies sparked protests and added to worries about rising costs of living and migration. 

The most difficult steps to meet the EU’s ambitious 2030 climate goal of cutting greenhouse gases by 55% from 1990 levels are yet to be implemented. In 2027, the EU is due to launch a new carbon market for heating and transport fuels, a move that will impact consumers. By 2035, all new passenger cars will have to be emissions-free, effectively one step closer to sending the combustion engine to the museum.

“Populist parties have unfortunately gained too much ground” and “only fairer policies” and “better listening to citizens are the solution to polarization,” said Laurence Tubiana, chief executive of the European Climate Foundation. “I refuse to give in to fatalism. There can be no solving the cost of living crisis, security or competitiveness without ecological transition.”  

The biggest challenge for the EU will be to ensure financing for the green transition as economic growth remains sluggish and inflation sticky. Voters are still reeling from price increases following an unprecedented energy crisis. EU policymakers even before the election were focusing on how to prevent green policies from harming their economies and much-dreaded deindustralization. Companies subject to ever-stricter pollution caps have feared the loss of competitiveness in the face of massive clean-tech incentives offered by the US and China. 

Emissions cuts will have to accelerate further in the next decade for Europe to meet its mid-century goal of climate neutrality. To keep the bloc on track, the European Commission earlier this year floated a new goal for 2040: a reduction of greenhouse gases by 90%. A political debate on the target is yet to begin, with a formal proposal expected next year.

By the EU’s own estimates, the continent needs to invest about €1.5 trillion per year over 2031-2050 in its energy and transport systems to reach net zero, with the bulk coming from private finance. That’s a surge from the €863 billion it spent on decarbonizing the sectors each year between 2011 and 2020. 

But the current biggest public source of funding for the green transition — a post-pandemic €750 billion recovery program — is nearing its end and nations are split over new potential financing tools, including issuing joint debt. The risk is that growing divisions in the new parliament will make it even more difficult for the EU to set a way forward on policies including budgets and climate.

That could mean that building majorities for weakening or strengthening the Green Deal will be hard for the EU, which has the ambition to lead global action on climate, according to Peter Vis, senior adviser at Rud Pedersen Public Affairs in Brussels and a former senior climate official at the European Commission.

“In a world in crisis, this might mean Europe can’t make its voice heard – for want of clear messaging,” he said.

--With assistance from Zoe Schneeweiss.

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