€400 billion ‘Clean Deal’ must start EU’s green industrial rebirth

The European Commission proposed a significant action plan on Wednesday to accelerate the decarbonization of European industry. The Commission believes that EU countries must act now.

The climate crisis, weak economic growth, declining business competitiveness, and significant geopolitical tensions (with Moscow, Washington, and Beijing) require a comprehensive transition plan. 

Various supporting measures should help with this—from affordable energy for companies and relaxation of state support to joint purchasing of raw materials. SMEs with 250 to 1,000 employees no longer have to prepare extensive reports on sustainability and human rights, among other things.

Circular economy

For example, member states may subsidize energy-intensive industries so that they can quickly make the transition to electric production. Start-ups working on clean energy can also receive additional support from member states.

Furthermore, it is time to take the circular economy seriously. Reusing raw materials reduces production costs and makes the EU less dependent on dubious exporters. Companies that focus on recycling will receive more financial support in the future. By 2030, the EU must become the global market leader in the circular economy.

More European chauvinism

European companies must stay in Europe, and Europeans must buy as many European products as possible. The Commission opts for an accelerated phase-out of expensive (often imported) oil and gas to prevent heavy industry from leaving Europe. Europe must become self-sufficient with its own cheaper and cleaner energy.

However, switching to clean production and new technologies – better batteries, solar panels, hydrogen, and CO2 storage – costs much money. According to the Commission, all proposals from the Clean Deal will free up 400 billion euros for investments in the coming years.

‘Clean Deal’

In addition to this support, the Commission also wants a new ‘climate neutrality bank’ of 100 billion euros to help companies transition to clean production. Part of the starting capital for the climate bank comes from the proceeds of the CO2 emission allowances – the so-called ETS system. “So we reinvest the money that comes from the industry back into the industry,” says Ursula von der Leyen.

“The heart of the ‘Industrial Clean Deal’ is working toward “a clean, safe, and prosperous Europe,” said European Commissioner Wopke Hoekstra (Climate and Clean Growth) after the presentation. According to him, the decarbonization of the industry is “important for the climate, competitiveness, and our independence.”

The Commission emphasized that the climate goals from the Green Deal – 55 percent fewer greenhouse gases in 2030 and climate neutrality in 2050 – remain valid.