The European Commission has released the EU Clean Industrial Deal, dedicating nearly $105 billion (€100 billion) for strengthening industrial competitiveness, accelerating decarbonization, and transitioning towards clean energy.
This plan intends to fortify the EU’s industrial power in a turbulent and changing global market, switching the focus to its domestic resources and reducing the dependency on foreign supplies.
A key element of the EU Clean Industrial Deal is the electrification and decarbonization of energy-intensive industries.
In this sense, the Action Plan on Affordable Energy will aim to expand the clean energy infrastructure, ramping up electrification efforts and improving the stability and structure of the grid, while lowering expenses for industrial energy by cutting down the reliance on imported fossil fuels.
This year, the Industrial Decarbonization Accelerator Act is expected to introduce a voluntary carbon intensity label for products like steel, with cement expected to follow suit.
To boost its circular economy, the Union announced that it will create an EU Critical Raw Material Centre to purchase and store essential materials, and in 2026, a Circular Economy Act will be launched to increase the usage of recycled materials to 24% by 2030.
A Clean Industrial Deal State Aid Framework will also be implemented to simplify and speed up approvals for state-supported projects.
Relevant: New Report Provides Recommendations On Scaling CDR In The EU
The EU is working towards decarbonizing its economy by 2050, and, according to the European Commission, this deal recognizes decarbonization as an important driver of industrial growth.
However, reactions following the release of the Clean Industrial Act indicate that this plan might not provide specific tools that would support the rapid advancement of the carbon removal sector—one of the main climate action pillars that offers a chance for tech competitiveness.
Non-profit organization Carbon Gap called the move “another missed opportunity to set a clear and ambitious roadmap for scaling up carbon dioxide removal in Europe”.
Rodica Avornic, Policy Director at Carbon Gap, commented, “The EU risks lagging behind the US, Canada, and Switzerland, which have already mobilized significant financial support for CDR.”
She explained, “With compliance measures only taking effect in at least 5 years, the EU urgently needs interim deployment incentives to scale up the CDR sector and be competitive. Several upcoming initiatives under the Clean Industrial Deal—such as the Industrial Decarbonization Accelerator Act and the revision of procurement rules—must be leveraged to achieve effective CDR scale-up.”
On behalf of Clean Air Task Force, Alessia Virone, Government Affairs Director, Europe, stated, “The EU will need to take strong, practical actions to boost investors’ confidence and reduce the system’s cost to deliver on climate commitments while ensuring a resilient and competitive economy.”
According to her, the Clean Industrial Act updates are a step in the right direction and include a broad range of initiatives that could contribute to a sustainable EU economy.
“However, to ensure they deliver on their ambition, specific initiatives will have to be fully fleshed out, sufficiently funded, and effectively implemented,” she adds.
“The CID acknowledges that the technologies needed to achieve decarbonization can bolster the EU’s competitiveness, making climate action an enabler of rather than an obstacle to Europe’s industrial success. We’re encouraged to see this, as both of these objectives are mutually reinforcing. Only by championing clean technologies and products early and effectively can the EU hope to secure a sizeable share of these nascent global markets.”
