L R AS Published on Tuesday 7 February 2023 - n° 433 - Categories:Europe

The European Commission's industrial plan

As expected, the President proposed a four-part plan: a predictable and simplified regulatory environment, better access to finance, improving skills and opening up trade for resilient supply chains.

For the first part, the Commission will propose an industry law to set industrial capacity targets and provide an appropriate regulatory framework for rapid deployment. It will ensure faster and simpler authorisations, while favouring strategic European projects.

The second will aim to accelerate investment and funding to produce clean technologies in Europe. Public funding could lead to huge amounts of private funding (according to the President).

The third pillar concerns improving skills and training qualified people

The fourth consists of "putting trade at the service of the ecological transition, in accordance with the principles of fair competition and open trade, on the basis of the commitments made with the European Union's partners and the work of the World Trade Organisation. The European Commission will further develop the European Union's network of free trade agreements and other forms of cooperation with partners to support the ecological transition".

In a nutshell, the President believes that better access to finance will enable key clean technology industries to "develop rapidly."

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The lack of response to these proposals is impressive. SolarPower Europe believes that the industrial plan lacks detail and fails to distinguish between "net-zero" technologies in its policy proposals.

Others believe that the Commission is merely seeking to facilitate Member States' access to funding for the production of clean technologies.

The various media have ignored this intervention as if it were of no interest. To justify their position, they argue that the President's comments need to be confirmed by the meeting of European leaders on 9 and 10 February, and that the Commission's line of reasoning is not sufficient.vrier, and that the divide is too deep between those states that want to create a European industry and those that are suspicious of the Commission's interventionism or of the expenditure that this entails.

https://www.pv-magazine.com/2023/02/02/european-commission-introduces-green-deal-industrial-plan/

https://www.pv-tech.org/eus-green-deal-industrial-plan-is-a-once-in-a-generation-opportunity-to-secure-a-renewables-industrial-lead/

Editor's note The different positions of the various Member States with regard to the response to the American plan or to Chinese domination make it particularly difficult to have a common, offensive position. The Commission's proposal is to encourage funding and to propose a general framework. In other words, it is not much compared with the American plan, which provides dollars (in the form of tax credits) for each new production unit, for each megawatt supplied, for each product manufactured in the United States. This aid reduces the production cost of each product, making it possible to be competitive, which will be reinforced by customs measures.

Here, the loans will be repayable and limited to three years (compared with ten across the Atlantic). The European plan is based on "open trade for resilient and diversified supply chains. This means working on free trade agreements and other forms of cooperation with EU partners to support the region's green transition", according to the President. It sounds like a dream! Will the Chinese play the game of free trade agreements when their objective is to sell their products by any means necessary?

It doesn't add up. This plan is more of a communication operation to say that the Commission has taken up the problem, but it will have no effect because of European divisions and, above all, the meagreness of the proposals. Will there be a reaction from the Member States who want to counter the United States by introducing a proposal directly modelled on their Inflation Reduction Act? It's hard to say, but it would be the only way to establish a level playing field on both sides of the Atlantic.

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