The European Commission is following in the footsteps of the Net Zero Industry Act (NZIA) by stepping up the pace, according to a draft communication from the Clean Industrial Deal, a copy of which was obtained by Agence Europe. The ‘Strategic Compass’ had already paved the way by announcing most of the initiatives contained in the ‘Clean Industrial Deal’ (see EUROPE 13568/1). It provides details of the timetable, as well as the content of certain proposals, such as the ‘Industrial Decarbonisation Accelerator Act’ and the Commission’s plans to create lead markets. Unsurprisingly, work on energy prices is at the heart of the Commission’s communication, which is accompanied, as promised, by an Action Plan for Affordable Energy (see other news).
The Clean Industrial Deal is divided into six so-called ‘drivers’, meaning that action is needed in these six areas to enable the clean tech industry to flourish. The subjects are as follows: - energy prices; - lead markets; - investments; - circular economy; - global markets; - skills.
Lead markets. This is one of the avenues most recently promoted by the Commission, especially by Executive Vice-President Stéphane Séjourné: the creation of lead markets to stimulate demand for clean technologies.
This inevitably involves public procurement and the introduction of local production criteria into the rules, in other words, European preference. The revision of the rules governing public procurement in 2026 will enable the Commission to implement this principle. The aim is “to make the European preference criterion a structural feature of European public procurement in strategic sectors”, according to the Commission’s draft communication, which is still subject to arbitration.
In the shorter term, the ‘Industrial Decarbonisation Accelerator Act’, scheduled for late 2025, should continue along the lines of the NZIA and introduce a resilience and sustainability criterion in public procurement or auctions, but also for access to European funding programmes, and only for energy-intensive sectors.
In its ‘Industrial Decarbonisation Accelerator Act’, the Commission is also expected to propose a voluntary label on the carbon intensity of industrial products, which could highlight European low-carbon technologies.
Hydrogen is another way of stimulating demand for clean technologies. The Commission plans to adopt the delegated act for low-carbon hydrogen in the first quarter of 2025 in order to “clarify the rules for low-carbon hydrogen production in a pragmatic way, providing certainty for investors” (see EUROPE 13507/5).
In addition, the Commission has indicated its intention to launch the third European Hydrogen Bank call (see EUROPE 13537/10) in the third quarter, without yet specifying the budget.
Investments. After months of debate on the ‘Draghi’ report and its call for increased public and private investment, the Commission is making some choices and detailing what it can - and wants to - put in place.
In addition to the forthcoming review of State aid rules, the Commission is announcing a new Clean Industry State Aid Framework (CISAF). It should contain simplified rules and accelerated procedures for approving subsidies for clean tech projects. Instead of going through individual assessments, projects will, for example, be able to benefit from simplified methods for authorising aid.
Clear criteria of resilience and strategic autonomy will also be taken into account when supporting large-scale production projects, such as in the battery sector, which often lack investment.
Member States will have to publish information on each individual public aid of more than €100,000 granted under these rules and of more than €10,000 in the agriculture and fisheries sectors within 6 months of the date on which it is granted.
The European Commission points out that, more generally, the framework for State aid needs to be simplified.
To see the proposal for a special Clean Industry State Aid Framework: https://aeur.eu/f/fk3
As far as European funding is concerned, pending the next Multiannual Financial Framework (MFF), the Commission is looking for new funding options under the 'Innovation Fund'.
It is also expected to propose, in 2025, a ‘facility’ for industrial decarbonisation with an auction of several billion euros to support decarbonisation and electrification.
In the longer term, the Commission is counting on its ‘Competitiveness Fund’, its fate depending on the negotiations for the future MFF.
With regard to private investment, whose potential the Commission wants to unlock, the amendment of the InvestEU regulation could contribute to this, in particular by increasing the programme’s risk capacity.
Global markets. To ensure that European companies have as large a share as possible of the global clean tech market, the Commission is counting on free trade agreements to facilitate flows, but also on new ‘Clean Trade and Investment Partnerships’.
It intends to launch negotiations for such a partnership as early as March, but is refraining from revealing the partner in question.
This type of agreement would contain rules like traditional FTAs, regulatory cooperation and financial support to develop strategic value chains with partners. The areas of cooperation will reportedly be limited in relation to the usual trade agreements, so as to be able to negotiate more easily - and conclude quickly - with as many partners as possible.
Still on the subject of trade, the Commission points out that the revision of the Carbon Border Adjustment Mechanism (CBAM) and its simplification (see EUROPE 13576/11) will help to protect European industry and make it more competitive.
The will to defend the interests of European companies in the face of unfair practices is reiterated. The Commission wants to make use of the trade defence tools at its disposal, but also to continue to develop other instruments, such as the one on foreign investment screening or the regulation on unfair foreign subsidies.
To see the draft communication for the Clean Industrial Deal: https://aeur.eu/f/FK6 (Original version in French by Léa Marchal with Pauline Denys, Mathieu Bion and Anne Damiani)