Today’s long-awaited Industrial Accelerator Act presented by the European Commission shows a first step to support the EU’s industrial transformation.
As the first flagship initiative under the Clean Industrial Deal, the proposal sets out a vision for industrial policy enshrined in regulation and contains some positive measures aiming at driving demand for low carbon products and accelerating the roll-out of clean technologies. However, WWF stresses that while these measures are welcome, much more is needed to truly shape the EU’s industrial future.
The previously named Industrial Decarbonisation Accelerator Act makes a start in delivering its initial promise to help decarbonise the EU’s energy-intensive industries, like steel, cement and chemicals, while supporting the production of clean technologies in the EU. It introduces some new demand-side measures for low-carbon products. Now, for the creation of robust lead markets the Commission will need to step up its efforts to deploy stronger demand-side measures. This should be achieved by designing mandatory truly green steel and cement labels through the Ecodesign for Sustainable Products (ESPR) Regulation and the Construction Products Regulation (CPR).
Lead markets for clean industrial products: a good start
A central measure in the proposal is the introduction of low-carbon criteria in public procurement. For example, at least 25% of steel used in public buildings would need to be low-carbon steel. This is an important first step, but public procurement only represents a small share of Europe’s steel demand. To create meaningful, long-term markets for clean materials, complementary measures that also target private consumption will be essential.
To be truly successful, the IAA must also go hand in hand with a strong carbon price. A clear and predictable price on pollution drives innovation and gives companies and investors the confidence to invest in clean technologies.
“The Commission has finally pressed the accelerator on clean industry by opening the door to create demand for clean products. However, to win the race to decarbonise, the Commission and policy makers will need to put effort into strengthening low-carbon requirement criteria and designing truly green labels for steel and cement that exclude fossil fuel-based production,” said Camille Maury, Senior Policy Officer on Industrial Decarbonisation at WWF EU.
“All of these won’t materialise without regulatory stability and a strong, predictable carbon price. The upcoming revision of the EU Emission Trading System revision later this year will be a make-or-break moment,” concluded Maury.
Faster permitting, but not at the expense of nature
Efficient permitting can play a crucial role in the industrial transformation, especially when supported by digital tools, better administrative coordination, and properly resourced permitting authorities. The Act introduces so-called industrial manufacturing acceleration areas, zones with shorter permitting timelines, shared infrastructure and improved access to financing. WWF warns that these need to be carefully designed as every industrial project must remain subject to robust environmental impact assessments, and any designated areas should be located in regions where environmental risks are minimal. Also, not all industrial manufacturing projects located within an acceleration area should be considered ‘strategic.’
