Brussels wants to mobilise 100 billion euros with the creation of a Clean Industry Bank

At a time of growing trade tensions with the United States and a race between the world's major powers for industrial competitiveness, the European Commission has, as promised, laid out the main lines of this new legislature in the first 100 days of its mandate. It is doing so by launching the second part of the Green Pact that marked the previous legislature, the Pact for Clean Industry. A plan to mobilise up to 100 billion euros in the short term through a Clean Industry Bank that will provide financial support to the green energy industry and decarbonisation, 1 billion of which will be provided under the next community budget. This plan includes measures to speed up the granting of State aid and tax incentives to mobilise green investment.

The idea of ​​this Pact for Clean Industry is to put into industrial practice the decarbonisation process initiated in the previous mandate with a focus on the most energy-intensive sectors, whose competitiveness is affected by high electricity prices, and on green energies, as part of the transition towards renewables.

To this end, the plan includes the creation of national tax incentives for which the Commission will issue recommendations at European level. The European Vice-President for Clean Transition, Teresa Ribera, has indicated that the plan includes "medium-term actions to provide certainty and predictability to build confidence, unlock investment and provide companies with the necessary conditions to grow."

The European Executive's idea therefore includes several proposals. On the one hand, to adopt a simplified framework for granting State aid for clean industry, which will allow new public aid to be approved more quickly to promote the development of renewables, boost decarbonisation processes and ensure sufficient manufacturing capacity for clean industry.

Furthermore, this plan contemplates not only strengthening the Innovation Fund but also the creation of a Bank for Industrial Decarbonisation, with 100 billion euros in financing that will come from the Innovation Fund (20 billion), from contributions from the Member States (30 billion) and from the benefits generated by Emission Rights (25 billion), and from the regulatory simplification carried out by the European Commission of the Invest EU programme (25 billion).

Specifically, Brussels is proposing to review the Invest EU programme in such a way as to increase its capacity to assume risks and mobilise up to 50 billion euros in public and private financing for clean industry, green mobility and waste reduction.

The European Investment Bank is also coming into play, making available to the industry a series of financing packages aimed at promoting energy interconnections by granting guarantees to component manufacturers in the sector. In addition, there is a joint programme between the bank and the European Commission, aimed at offering guarantees for power purchase agreements ( PPAs ) for small and medium-sized enterprises and energy-intensive companies and, finally, the launch of a guarantee instrument for clean technologies within the framework of the Tech EU programme promoted by InvestEU.

At the regulatory level, this clean industry package includes a law for the acceleration of industrial decarbonisation, which aims to speed up the granting of permits for such business initiatives, for example, to modernise steel production. It will also establish a label for low emissions and introduce criteria to promote a clean supply chain in energy-intensive industrial sectors.

On the other hand, Brussels proposes a review of the public procurement directive to give priority to sustainability criteria in these processes in strategic sectors, a new framework for State aid for the Clean Industry Pact that will speed up the granting of aid for renewable energy projects, legislation to promote hydrogen production to give predictability to the industry by establishing the conditions for companies to invest and, finally, Circular Economy legislation to promote the reuse of materials and waste.

In addition, the legislative proposal includes the reinforcement and extension of the Carbon Border Adjustment Mechanism (known as C-BAM), so that it can be applied to more sectors. The EU Vice-President for Industrial Strategy, Stéphane Séjourné, has announced the creation of a joint purchasing programme for critical raw materials which, emulating the formula for purchasing vaccines during COVID, will be voluntary. In addition, the extraction and exploitation of raw materials and rare earths on EU soil will be promoted.

In addition, part of this package includes the presentation of an action plan for the automotive sector in March and another for aluminium and steel in the spring. It also plans to do the same for the chemical and clean technology sectors.