On Wednesday, February 26, the European Commission published the text of the Clean Industrial Deal, which provides for increased energy availability, expanded financing for the “clean transition” and the development of a circular economy.
The relevant message appeared on the website of this main executive body of the European Union.
The document is positioned as a “bold business plan aimed at supporting the competitiveness and sustainability of industry.” It focuses mainly on two closely related sectors:
1. Energy-intensive industries, as they need urgent support for decarbonization and electrification.
“This sector faces high energy prices, unfair global competition, and complex regulation that harms its competitiveness,” the Agreement says.
2. Clean technologies, as they underpin future competitiveness and growth, and are crucial for industrial transformation, the authors of the document say.
The European Commission has also identified the circular economy as one of the central elements of the Agreement. The authors of the document are convinced that it is necessary to make the most efficient use of the EU's limited resources and reduce excessive dependence on third-country suppliers of raw materials.
The agreement provides for measures aimed at strengthening the entire value chain. The European Commission says that it will serve as a basis for adapting actions in specific sectors. Thus, an Action Plan for the automotive industry will be presented in March, and an Action Plan for steel and metals will be presented in the spring. Other special measures are planned for the chemical industry and the clean technology sector.
Business drivers of the Clean Industry Agreement
Today's communication identifies 6 factors that, according to the European Commissioners, will help the EU industry succeed:
1. Reducing energy costs.
The European Commission has identified affordable energy as the basis for competitiveness. Therefore, the Action Plan on Affordable Energy was adopted simultaneously with the Clean Industry Agreement. It is aimed at reducing energy bills for both industry and business, as well as for households.
Officials claim that the plan will accelerate clean energy deployment and electrification, add physical interconnection to the domestic energy market, and make more efficient use of energy and reduce dependence on imported fossil fuels.
2. Increase demand for environmentally friendly products.
To this end, in the 4th quarter of 2025, the European Commission plans to adopt the Industrial Decarbonization Accelerator Act.
It will introduce
- sustainability criteria, resilience and “made in Europe” labeling in public and private procurement;
- voluntary labeling of the carbon component of industrial products, first for steel in 2025, and later for cement.
The European Commission also promised to simplify and harmonize carbon accounting methodologies.
“These labels will inform consumers and allow producers to receive a premium for their decarbonization efforts,” officials say.
3. Financing the “clean transition”.
In the short term, the Clean Industry Agreement will mobilize more than €100 billion to support cleaner production in the EU. This amount includes additional guarantees of €1 billion under the current Multiannual Financial Framework.
The Commission intends to:
- Adopt a new Clean Industrial Deal State Aid Framework in Q2 2025. It will simplify and accelerate the approval of state aid measures for the introduction of renewable energy, the deployment of industrial decarbonization and the provision of sufficient production capacity for clean technologies.
- Strengthen the Innovation Fund and create an Industrial Decarbonization Bank with a financing volume of €100 billion, based on the available funds in the Innovation Fund, additional revenues from parts of the emissions trading system (ETS), and the revision of the InvestEU financial program.
- Amend the InvestEU Regulation to increase the program's risk absorption capacity. This will mobilize up to €50 billion in additional private and public investment, including in clean technologies, clean mobility and waste reduction.
The European Investment Bank (EIB) Group will also launch a number of new financial instruments to support the Clean Industrial Deal:
- A “Package for Power Grid Manufacturers” to provide counter-guarantees and other risk mitigation support to manufacturers of power grid components;
- a joint pilot program of the European Commission and the EIB to provide counter-guarantees for electricity purchase agreements concluded by small and medium-sized enterprises and energy-intensive industries;
- The Clean Technology Guarantee Fund under the Tech EU program, funded by the InvestEU program.
4. Circular economy and access to materials.
The European Commission has recognized critical raw materials as key to the bloc's industry. Therefore, the EU is committed to ensuring access to such materials and reducing dependence on unreliable suppliers. The European Commission plans to:
- Create a mechanism that will allow European companies to unite and consolidate their demand for critical raw materials.
- Create an EU Critical Raw Materials Center to jointly purchase raw materials on behalf of interested companies. In this way, they want to save money through large purchases and get more leverage to negotiate better prices and conditions.
- Adopt the Circular Economy Act in the 4th quarter of 2026. The goal is to have 24% of materials recycled by 2030.
5. Actions on a global scale.
The European Commission emphasized that “the EU needs reliable global partners more than ever” and announced the launch of the first clean trade and investment partnerships in the near future. Officials pledged to act even more decisively to protect European industries from unfair global competition and overcapacity through a range of trade defenses and other instruments.
The European Commission is also simplifying and strengthening the carbon-based import adjustment mechanism (CBAM).
6. Ensuring access to skilled labor.
The European Commission is creating a Skills Union that will invest in workers, develop skills and create quality jobs. It will spend €90 million to strengthen sectoral skills for strategic industries related to the Clean Industry Agreement through the Erasmus+ program.
Recently, EcoPolitic talked about the main dilemma the EU has to solve with the Clean Industry Agreement. We also reported on the simplification of bureaucratic procedures, which the European Commission is taking to increase the competitiveness of
