The European Commission will permit member states to allocate up to 0.3% of GDP annually through 2028 for green energy measures that breach EU fiscal rules, Economy Commissioner Valdis Dombrovskis announced. This concession addresses the prolonged energy crisis fueled by Middle East tensions, particularly the closed Strait of Hormuz following recent US-Iran hostilities.

Countries like Italy have pressed Brussels for expanded fiscal flexibility beyond the initial defense-focused escape clause. Rome's Prime Minister Giorgia Meloni specifically requested inclusion of energy investments under the national safeguard clause, though Italy hasn't yet activated the defense provision. The green emphasis may clash with Italy's recent fuel tax cuts, which already drew IMF criticism for lacking targeted relief.

Nations already using the defense carve-out, such as Poland and Baltic states, can access energy spending after additional debt sustainability reviews. The policy applies retroactively to measures dating back to February, requiring investments to strengthen energy system resilience and accelerate the transition away from fossil fuels.

Meanwhile, the Excessive Deficit Procedure continues monitoring 10 countries with deficits exceeding 3% of GDP. Bulgaria joins the watchlist while Malta exits, reflecting ongoing fiscal scrutiny amid geopolitical uncertainty. This green-conditioned spending allowance signals Brussels' attempt to balance energy security with climate commitments.