"This is a historic day for Europe and for the planet. We have shown that ambitious climate action and economic prosperity can go hand in hand."

The agreement came after intense negotiations, with Eastern European countries securing additional transition support for coal-dependent regions. Poland, which had been the main holdout, agreed to the deal after securing €50 billion in additional Just Transition funding.

Environmental groups have given the deal a cautious welcome, though some argue the targets still fall short of what's needed to limit global warming to 1.5°C. Industry representatives, meanwhile, have expressed concerns about competitiveness but welcomed the regulatory clarity.