Illustration: Zstockphotos, modified by RE.
The European Parliament has just adopted a text to stimulate the production of net-zero emissions technologies on European soil. Will this text be enough to reindustrialize the European Union (EU) and fight global competition?
To support the energy transition of EU member states, different industrial sectors are adapting and offering new products. However, industrial activity is subject to strong competition from companies located outside the EU. This is the case of the photovoltaic sector, for example, which is highly exposed to competition from Chinese products sold at low prices. European companies are failing to establish themselves in the market, leading to factory closures and relocations. We remember in particular the bankruptcy of the French Systovi and the closure of the Meyer Burger solar factory in Germany. The company has chosen to settle in the United States. For what ? Quite simply because with his “Inflation Reduction Act” adopted in 2022, Joe Biden protected the American market from international competition by financially supporting companies established on its soil.
An EU law for a “net zero emissions” industry to protect EU businesses
To maintain European industry in the face of this phenomenon, it was urgent to act to both preserve jobs, but also to have a certain sovereignty in the manufacturing of products essential to the energy transition. To this end, the European Parliament adopted on Thursday April 25 a law for a “net-zero” industry or Net-Zero Industry Act (NZIA). The stated objectives of the text are as follows:
- Make the EU internal market suitable for industrial decarbonization;
- Support the necessary technologies to achieve climate objectives;
- Accelerate permitting procedures and create net-zero industrial valleys;
- Determine new criteria for public purchasing procedures.
The set of measures taken by this text should enable the EU to produce 40% of its annual needs in the deployment of net-zero emissions technologies by 2030. It is also a question of capturing 15% of the global market value of these technologies.
Read also Our dependence on Chinese photovoltaic panels, a danger for the energy transition?Favor products manufactured in Europe taking into account sustainability and resilience criteria
Several sectors are affected by this new law: renewables, nuclear power, industrial decarbonization, networks, energy storage technologies and biotechnology. Among the measures taken, there is that concerning the acceleration of administrative procedures to facilitate the obtaining of permits, the reduction of deadlines for the issuance of the authorizations necessary for the implementation of new projects. Furthermore, in order to favor products manufactured in Europe, Member States will have to encourage consumers to consider sustainability and resilience criteria when purchasing their solar panels or heat pumps. These criteria must also be considered during public purchasing procedures and auctions linked to the deployment of renewable energies.
The rapporteur of the text, Christian Ehler declared that “This vote is good news for European industry and sets the tone for the next mandate. To achieve all our economic, climate and energy goals, we need industry in Europe“. The text was adopted by 361 votes to 121 with 45 abstentions. To become applicable, it must still be adopted by the Council.
A text of uncertain scope in a context of strong global competition in the low-carbon technology market
But will this text be enough to preserve industry in Europe? This is not what some experts, interviewed by the media Euractiv, think, who fear that it will not produce enough effect. According to them, administrative deadlines would not be decisive in the implementation of new projects and the new provisions taken on this point would therefore have little impact. Then, the text provides that the criteria of resilience and sustainability could be set aside in public purchasing procedures if they prove too costly, which amounts to giving priority to products sold at low costs and manufactured outside the country. EU.
The text adopted by Parliament attempts to encourage European industry without penalizing products manufactured outside the EU. Time will tell whether these measures are enough to make European companies sufficiently competitive on the market.
