A bold vision for a climate-neutral and competitive Europe

The clean-tech sector can be a prime example of the European capacity to stay at the forefront of innovation, technological advancements will be necessary for its industrial transformation, reach the targets for circular economy and accelerate decarbonisation.

How is the clean tech sector transforming the future of the green transition in Europe? This set of parallel roundtable briefings will feature inspiring conversations on breakthrough technologies led by green tech entrepreneurs, experts and scientists

Energy poverty has increased substantially in recent years; due to heightened inflation and the cost-of-living crisis almost 50 million Europeans have struggled to keep their homes warm. At the core of addressing energy resilience, industrial competitiveness and accelerated decarbonisation stands electrification which, with the proper policy framework, can contribute to these key EU objectives. With the release of the Clean Industrial Deal, the European Commission sets a goal to lower energy prices and electrify almost one-third of the European economy in the next 5 years. Electrification plays a crucial role in reaching the net-zero scenario, as it helps mitigate carbon emissions. In addition, electric technologies are generally much more energy efficient than their fossil fuel-based counterparts. According to the International Energy Agency (IEA), achieving the Net Zero by 2050 Scenario will require a yearly increase of the share of electricity in the total energy demand by 4%. While Europe is already home to some of the technologies required to boost the electrification of its most relevant manufacturing sectors, barriers of various nature remain for adopting electrification technologies in industries such as high-temperature chemicals, iron and steel, aluminium, glass and cement. The Clean Industrial Deal sets the path for clean energy production to be more attractive for the industrial sector and for energy bills to be less volatile. Aligning taxation with technologies’ contribution to climate neutrality goals by making progress on the revision of the Energy Taxation Directive and facilitating Power Purchase Agreements (PPAs) will increase the affordability of energy while also contributing to the promotion of economic growth and social fairness, especially in the context of broader adjustments of public policy instruments.

Questions for consideration include:

• How will the Action Plan for Affordable Energy decrease energy costs and tackle energy poverty?
• What barriers remain to electrification in the European path to climate neutrality?
• How can Europe support increased electricity integration between Member States?
• How does electrification become a shared goal beyond the industry? What are the implementing steps to reach our climate neutrality targets?

According to the survey and focus group research “Voices for Choices” conducted
by Debating Europe in five European member states, 60% of young European
citizens consider it important for products and services to be ‘made in Europe’, and almost 70% in Germany, France and Italy believe that the European Union should maintain climate action as a top priority even beyond the current institutional cycle. The support of European manufacturing capacity features in the Industrial Decarbonisation Accelerator Act, announced for the end of this first mandate year. Introducing non-price criteria in public procurement can strengthen the demand for EU-made clean products and allow Europe to capitalise on decarbonisation, especially where it has a competitive advantage.
Europe navigates a year of drastic geopolitical shifts where alliances and political priorities have shifted. The “existential challenges” that Europe faces, as former Italian prime minister Draghi has called them, would require additional annual investments of €800bn to increase growth and productivity. The unequal and tight fiscal room of manoeuvre between the European member states represents in this sense a great challenge leading to strong negative impacts on the Single Market, jeopardising the capacity of the Union to progress jointly as a bloc and increasing economic and social divergence.

Questions for consideration include:

• Given Europe’s fiscal constraints, what structural reforms and budgetary innovations should public institutions prioritise to align financial resources with the joint goal of accelerating decarbonisation and maintaining competitiveness?
• Considering the existential nature of the challenges facing the EU, how can citizens be taken on board to ensure trust in the European project and climate neutrality goals is maintained?
• How will the Industrial Decarbonisation Accelerator Act favour the demand for clean products “made in Europe”?