The Clean Industrial Deal, an ambitious roadmap for European industry

Dependence on rare resources, climate challenges, energy transition, industrial competitiveness... Europe may seem to be far behind in the current geopolitical game and the trends that are emerging. for the future.

For the Old Continent, the time for questioning and action has therefore come. And that's the whole point of Clean Industrial Deal, unveiled on 26 February by the European Commission.

This pact seeks to reconcile decarbonization, reindustrialization and innovation, in a long-term vision aimed at rGiving Europe back the keys to its sovereignty and competitiveness.

To place the hopes of an entire continent in a project that is both economic and environmental? At a time when the United States and China tend to turn a blind eye to environmental and social issues in order to focus on their growth? The idea seems ambitious at the very least.

To find out more, let's dive together into the heart of this structuring deal for industrial competitiveness in Europe and the preservation of the environment.

In the summary of this article:

  1. What is the context of the Clean Industrial Deal?
  2. What are the main actions of the Clean Industrial Deal?
  3. Why is the Clean Industrial Deal essential for industry and the circular economy in Europe?

1. What is the context of the Clean Industrial Deal?

To start this article, let's take a step back and focus on the history and issues that led to the Clean Industrial Deal.

As mentioned in the introduction, the Clean Industrial Deal is at the crossroads of two main strategic challenges for Europe and the world :

  • industrial sovereignty under threat in Europe;
  • a necessary energy and environmental transition on a global scale.

A risk of downgrading Europe in the face of increased global competition

The shock caused by current geopolitical events and the risk of downgrading Europe on the global stage has strengthened the European Commission's determination to quickly find and deploy new growth strategies.

Indeed, it has become clear that European countries are largely dependent on the resources and industrial power of other players.. In recent years, rising energy prices and dependence on critical raw materials have undermined many European industrial sectors, in particular batteries and strategic materials. This situation is currently showing its limits in the light of protectionist policies and trade wars that are strengthening among some of Europe's historical partners.

It is therefore essential to Establishing a framework for maintaining Europe's industrial sovereignty and relaunching its competitiveness, a finding that was widely shared in particular following the publication of various recommendations, including the report”The future of European competitiveness” by Mario Draghi, former president of the European Central Bank.

VoltR is helping to relaunch the manufacture of Lithium batteries in France.

Do you want to know more? See you on https://www.voltr.tech/notre-mission.

A necessary energy and environmental transition

The Clean Industrial Deal was born from another observation: European industry must reduce its CO2 emissions and adopt more sustainable models to meet its ecological commitments and participate in the global effort to protect the environment.

As of 2019, with the Green Deal, the European Commission has started to structure a greener industrial policy. But faced with the need to accelerate the energy and industrial transition to boost action against climate change, Europe needed to go even further. This was all the more necessary as the recent withdrawal of the United States from the Paris Agreement clearly threatens the commitments made in favor of the environment.

Decarbonization and circularity as a lever for sovereignty and competitiveness for Europe

To make progress on these two fronts, which are Europe's industrial sovereignty and respect for environmental considerations, the European Commission has identified a key project, both economic and social, at the heart of the Clean Industrial Deal.

Let us cite the European Commission as the preamble to His presentation of the Clean European Deal:”Faced with high energy costs and fierce global competition, European industries need urgent support. The Clean Industry Pact defines concrete actions for Making decarbonization a growth driver for European industry. This includes lowering energy prices and creating quality jobs and conditions for businesses to thrive.

In addition, in order to optimize Europe's limited natural resources and reduce its dependence on imports, The Clean Industrial Deal focuses on circularity, that is, the reduction of waste and the extension of the life of materials by promoting recycling, reuse and sustainable production (actions in which VoltR is fully committed). Note that the 2026 date for Circular Economy Act, which reinforces the Circular Economy Action Plan 2020, to push European industries to more circularity.

To conclude this part devoted to the challenges of the Clean Industrial Deal, let's recall The words of Stéphane Séjourné, then Executive Vice President for Prosperity and Industrial Strategy at the European Commission: This plan aims to strengthen our unique European model based on industrial decarbonization in order to create production made in Europe that is sustainable and competitive.. It is about producing more and better not only for environmental reasons, but also as a strategy for economic growth and as a security imperative.”

Let's now dig into the main lines of action desired by the European Commission.

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2. What are the main actions proposed by the Clean Industrial Deal?

The Clean Industrial Deal is therefore an ambitious pact aimed at reconciling the revival of competitiveness and the environmental and energy transition, by placing decarbonization and the circular economy at the heart of European industrial strategy.

It focuses on two types of industries in particular:

  • energy-intensive industries (manufacturing, transport, chemistry,...) who need support to move towards decarbonization and electrification because they face high energy costs, global competition and complex regulations;
  • clean technology, which are at the heart of Europe's competitiveness and growth according to the European Commission, while playing a decisive role in the industrial transformation of the continent

To support these transformations, the Clean Industrial Deal offers six key drivers :

  1. reducing costs to move towards affordable energy;
  2. stimulating the demand for so-called “clean” products;
  3. financing the transition to so-called “clean” energies;
  4. circularity and access to critical materials;
  5. action on a global scale;
  6. the development of skills and quality jobs.

More affordable energy

According to the Commission,”affordable energy is the cornerstone of competitiveness.”.

The situation is indeed bitter. :”Energy poverty affects more than 46 million Europeans and electricity is around three times more expensive than gas in many European countries. For industries, retail electricity prices have almost doubled since the start of the energy crisis in 2021.

To guarantee affordable energy, Europe is focusing on several axes, presented in its”Affordable Energy Action Plan”:

  • the reduction of energy costs, for households, as well as for businesses. La Commission proposes to reduce the cost of energy by reducing taxation and by encouraging the orientation of charges towards the proper use of the network and investment in new networks. She also wants to work on reducing the cost of transporting energy, through long-term supply contracts, accelerated procedures for the authorization of key energy projects, and increased integration of European energy markets. Finally, it will be a question of monitoring gas markets and working for better conditions for the purchase of imported gas;
  • strengthening the internal energy market. Concretely, it is a question of completing the Energy Union in Europe. This would strengthen coordination and shared energy governance. It would also be a question of creating interconnections between the various energy markets of the member countries. Finally, it is a question of working on the resilience of the energy system, capable of resisting supply disruptions. The threat, according to the European Commission, is to see the costs of the energy system increase considerably in the coming years if nothing is done;
  • efficient use of energy and the reduction of dependence on imported fossil fuels : by installing 100 gigawatts of renewable capacity every year until 2030 and by simplifying the rules relating to state aid to develop the deployment of renewable energies. Europe thus intends to make savings that, estimated at around 120 billion euros on energy bills in 2023, could reach around 162 billion euros in 2030.

Stimulating the supply and demand for more environmentally friendly products

The Commission intends encourage sustainable products made in the European Union.

To do this, public and private tenders are called upon to evolve, with the integration of sustainability and resilience criteria, preferably European ones. The objective is twofold:

  • push companies to produce, by creating promising markets for low-impact European products;
  • Encourage consumers to buy these products.

The mobilization of more than 100 billion euros in funding

More than 100 billion euros will be mobilized to support the manufacture of more environmentally friendly products in Europe.

Several levers will be activated:

  • an Innovation Fund, dedicated to supporting innovative technologies and processes that contribute to the decarbonization of industry;
  • a new framework for State aid to accelerate their unblocking in favor of the deployment of renewable energies, the decarbonization of industry and so-called “clean” technologies;
  • a specific call via Horizon Europe, to stimulate research and development aimed at the decarbonization of industry;
  • finally, the revision of the InvestEU programme, in order to increase the financial guarantees proposed to support investments in more environmentally friendly technologies.

Towards more circularity and eco-design

As we have seen, optimize theaccess to critical raw materials is a priority for Europe.

The European Commission's action on this point will aim at:

  • encourage businesses to combine their demands for critical raw materials;
  • launch an EU centre to make joint purchases of raw materials on behalf of interested companies, in order to achieve economies of scale and to negotiate more favourable prices and conditions;
  • promote the recycling, circularity and eco-design of products, with a desire to reach a rate of use of circular materials of 24% by 2030. Moreover, this is the challenge of VoltR, which considerably reduces the use of resources (water, critical metals, etc.) by reusing lithium battery cells.

Agreements on a global scale

Europe wants to maintain its place at the international level, and needs reliable international partners to do so.

In this sense, the European Commission will:

  • launch partnerships to diversify European supplies with a view to “clean” trade and investments;
  • deploying trade protection instruments in a delicate context of geopolitical and economic tensions;
  • strengthen and simplify the carbon border adjustment mechanism.

A Union of skills

Finally, the Commission underlines that training, skills development and the creation of skilled jobs are essential to meet the needs of industries in transition.

Europe therefore wants to set up a Skills Union., and will strengthen education and training programs to develop a skilled workforce. Financing options of up to 90 million EUR will be proposed.

3. Our point of view: why is the Clean Industrial Deal interesting for industrial renewal and the circular economy in Europe?

By promoting the circular economy and eco-design, the Clean Industrial Deal contributes to the creation of a more virtuous industrial and economic system.

The circular economy, by reducing dependence on virgin raw materials and by recovering waste, makes it possible to reduce the environmental impact of European industry. It also creates new economic opportunities and strengthens the resilience of businesses in the face of fluctuations in commodity markets.

Ecodesign of products, which consists of designing products taking into account their environmental impact throughout their life cycle, is a key element of this industrial approach.

From our point of view as a manufacturer of eco-designed lithium batteries, the Clean Industrial Deal is a very encouraging device, whose vision we fully share.

Our solutions for collecting used lithium batteries and manufacturing new batteries from second-life cells are directly in line with the goals of the Clean Industrial Deal:

  • reduction in dependence on raw materials : by reusing cells from used lithium batteries, it is no longer necessary to use critical and imported raw materials;
  • development of a new industrial and economic model : by promoting eco-design and circularity in our batteries, we are committed to offering high-performance products while having a low impact;
  • innovation and European competitiveness : by offering advanced reuse technologies and by creating local jobs and know-how.

The Clean Industrial Deal gives us additional impetus to accelerate our model and strengthen European industrial sovereignty. At VoltR, we are ready to take up this challenge and to build with our partners, a more competitive and more circular industry.

VoltR manufactures high-performance, competitive and eco-designed Lithium batteries in France.

Do you want to discuss it? Let's get in touch: https://www.voltr.tech/contact.

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