Council Adopts Net Zero Industry Act Position

The Council of the EU has adopted a position on a draft regulation, known as the ‘Net-Zero Industry Act’, aiming to strengthen Europe’s net-zero technology products manufacturing ecosystem. The goal of the Act is to expedite the deployment of essential technologies for the transition to climate neutrality, using the strength of the single market to enhance Europe’s economic resilience and competitiveness.

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The Net-Zero Industry Act aims to establish the European Union as a global leader in the green transition, utilising future technologies to boost the industry’s competitiveness, generate quality jobs, and enhance strategic sovereignty.

The Act proposes to create conducive conditions for investment in key technologies, simplify permit granting procedures, and prioritise strategic projects. It also seeks to facilitate market access for strategic technology products, enhance the skills of the European workforce in these promising sectors, and establish a platform to coordinate EU action in this area.

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Specific regulatory frameworks, known as regulatory sandboxes, are proposed for developing, testing, and validating innovative technologies. The Act proposes a benchmark of achieving 40% of production to cover the EU’s needs in strategic technology products, including solar photovoltaic panels, wind turbines, batteries, and heat pumps. It also sets a specific target for CO2 carbon capture and storage, aiming for an annual injection capacity of 50 million tonnes of CO2 by 2030.

The Council’s mandate supports the main objectives of the Net-Zero Industry Act. It introduces several improvements, including expanding the scope of application, clarifying permit-granting rules, improving access to market and public procurement, and promoting skills, research, and innovation. The Council position increases the list of strategic net-zero technologies from 8 to 10 by including nuclear and sustainable alternative fuels and expands the list of non-strategic net-zero technologies.

Under the Council position, strategic net-zero technologies will benefit from streamlined permitting procedures and additional support to encourage investments. The Council mandate also includes CO2 transport and infrastructure in the scope of the provisions for CO2 injection capacity.

The Council’s general approach clarifies public procurement procedures to ensure secure, transparent, implementable, and harmonised requirements for net-zero technologies. It also specifies the conditions under which public authorities can select a provider that is not the cheapest if it contributes more to environmental sustainability and resilience.

The Net-Zero Industry Act is one of three key legislative initiatives of the Green Deal Industrial Plan, alongside the Critical Raw Material Act and the reform of the electricity market design. Together, these initiatives aim to enhance the competitiveness of Europe’s net-zero industry and support a swift transition to climate neutrality.

The Council’s general approach agreed upon today formalises its negotiating position, providing the Council presidency with a mandate for negotiations with the European Parliament