00045/2024/LEX

Debate in Parliament

The European Parliament adopted by 361 votes to 121, with 45 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council on establishing a framework of measures for strengthening Europe’s net-zero technology products manufacturing ecosystem (Net Zero Industry Act).

The European Parliament’s position adopted at first reading under the ordinary legislative procedure amends the proposal as follows:

Subject matter

The general objective of this Regulation is to improve the functioning of the internal market by establishing a framework in order to ensure the Union’s access to a secure and sustainable supply of net-zero technologies , including by scaling up the manufacturing capacity of net-zero technologies and their supply chains to safeguard their resilience while contributing to achieving the Union’s climate targets and climate neutrality objective, with a view to the decarbonisation of the Union’s economy and society, and by contributing to quality jobs in net-zero technologies, and thereby also improving the competitiveness of the Union.

To achieve the general objective, this Regulation lays down measures aiming to:

- lower the risk of supply disruptions related to net-zero technologies likely to distort competition and fragment the internal market, in particular by identifying and supporting the scale-up of the manufacturing capacity of net-zero technologies and their supply chains;

- establish a Union market for CO2 storage services;

- encourage demand for sustainable and resilient net-zero technologies through public procurement procedures, auctioning and other forms of public intervention;

- enhance skills through the support of the Academies, thereby safeguarding and creating quality jobs;

- support innovation through the creation of net-zero regulatory sandboxes, coordination of research and innovation activities through the Strategic Energy Technologies Plan Steering Group, as well as through the use of pre-commercial procurement and public procurement of innovative solutions;

- improve the Union's ability to monitor and mitigate supply risks related to net-zero technologies.

Benchmarks

The Commission and Member States should support net-zero manufacturing projects in accordance with this Chapter in order to ensure the reduction of strategic dependencies in the Union of net-zero technologies and their supply chains by reaching a manufacturing capacity for those technologies of: (i) a benchmark of at least 40 % of the Union’s annual deployment needs for the corresponding technologies necessary to achieve the Union’s 2030 climate and energy targets; (ii) an increased Union share for the corresponding technologies with a view to reaching 15 % of world production by 2040 on the basis of monitoring carried out by the Commission.

The technologies supported include all renewable technologies, battery and energy storage technologies, heat pumps, hydrogen, electricity networks, nuclear, sustainable alternative fuels, biotechnology and CO2 transport and technologies.

Streamlining administrative and permit-granting processes

By 6 months from the date of entry into force of this Regulation, Member States should establish or designate one or more authorities as single points of contact at the relevant administrative level. Each single point of contact should be responsible for facilitating and coordinating the permit-granting process for net-zero technology manufacturing projects, including for net-zero strategic projects.

The amended text simplifies the permitting procedure , setting maximum deadlines for the authorisation of projects depending on their scope and level of detail.

For strategic zero-net projects, the permitting procedure should take no longer than twelve months for installations with an annual output of 1 GW or more, nine months for installations with an annual output of less than 1 GW, or eighteen months for all permits required for the operation of a strategic CO2 storage site and the deployment of related CO2 capture and transport projects.

For "net-zero" technology production projects, the permitting process should take no longer than eighteen months for installations with an annual production of 1 GW or more, and twelve months for those with an annual production of less than 1 GW.

Net-zero Acceleration Valleys

Member States may decide to designate net-zero Acceleration Valleys as specific areas to accelerate net-zero industrial activities, in particular to accelerate the implementation of net-zero technology manufacturing projects, including net-zero strategic projects or clusters thereof, or to test innovative net-zero technologies. The objectives of the Valleys should be to create clusters of net-zero industrial activity and to further streamline administrative procedures. The decision should: (i) define a clear geographic and technology scope for the Valleys; (ii) take into account areas that include artificial and built surfaces, industrial sites, and brownfield sites; (iii) be subject to an environmental assessment.

Sustainability and resilience criteria

National support schemes aiming to get households and consumers to move over to technologies such as solar panels and heat pumps more quickly will have to take into account sustainability and resilience criteria. Public procurement procedures and auctions to deploy renewable energy sources should also meet such criteria, albeit under conditions to be defined by the Commission, and for a minimum of 30% of the volume auctioned per year in the member state, or alternatively for a maximum of six Gigawatt auctioned per year and per country.

Member States should seek to use, where appropriate, pre-commercial procurement and public procurement of innovative solutions in order to stimulate innovation in net-zero technology and the creation of new manufacturing capacity for net-zero technologies in the Union.

Moreover, the Strategic Technologies for Europe Platform ( STEP ) will help to better channel existing Union funds towards critical investments aiming to support the development or manufacturing of critical technologies, including clean technologies.

T9-0378/2024

COM(2023)0161

Results of vote in Parliament

The European Parliament adopted by 376 votes to 139, with 116 abstentions, amendments to the proposal for a regulation of the European Parliament and of the Council on establishing a framework of measures for strengthening Europe’s net-zero technology products manufacturing ecosystem (Net Zero Industry Act).

The matter was referred back to the committee responsible for interinstitutional negotiations.

Subject matter

The amended text stipulates that the draft Regulation establishes the framework of measures to ensure a coordinated approach, throughout the Union, to the innovation and scaling up of the manufacturing capacity of net-zero technologies as well as of the components, materials and machinery along the supply chains of those technologies that are indispensable for their production and functioning in the Union to:

- support the Union’s climate targets and climate neutrality objective;

- foster the Union’s international industrial competitiveness in order to contribute to the creation of quality jobs;

- improve the Union’s access to a secure and sustainable supply of net-zero technologies;

- strengthen Union’s open strategic autonomy;

- safeguard the resilience of the corresponding Union’s supply chains; and

- achieve the decarbonisation of the Union’s economy and society.

To achieve the general objective, this Regulation contains measures with a view to ensuring the reduction of strategic dependencies in the Union of the strategic net-zero technologies as well as of the components, materials and machinery along the supply chains of those technologies that are indispensable for their production and functioning and that by 2030 reaches a manufacturing capacity corresponding to:

- at least 40 % of the Union’s annual deployment needs for the corresponding technologies necessary to achieve the Union’s climate and energy targets, based on the technological deployment planned across the Union according to the national energy and climate plans prepared and submitted by the Member States; and

- at least 25 % of global demand for the corresponding technologies.

Scope and definitions

Members enlarged the scope of the proposed Regulation to include the components, materials and machinery along the supply chains of those technologies that are indispensable for their production and functioning. The meaning of ‘net-zero technologies’ has also been streamlined by the Members.

The net-zero technologies within the scope of this Regulation should be, inter alia :

- technologies used for production of energy from renewable sources;

- nuclear fission and fusion energy technologies, including nuclear fuel cycle technologies;

- energy storage technologies;

- carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O), removal, capture, transport, injection (EPP), storage and utilisation technologies;

- hydrogen (H2) transport infrastructure technologies;

- electrolyser and fuel cell technologies;

- electric, hydrogen (H2), sustainable alternative fuels and wind propulsion technologies for transportation;

- electric charging technologies for transportation;

- heat pump technologies;

- energy efficiency technologies;

- biomaterials production technologies, including bio-based chemical production technologies;

- recycling technologies.

Financing of net-zero technologies

The amended text suggested that Member States should allocate 25% of their national Emissions Trading System (ETS) revenues for expenditures aimed at achieving the objectives.

Duration of the permit-granting process for strategic net-zero projects

In order to provide project promoters and other investors with the certainty and clarity needed to increase the development of zero-net technology projects, Member States should ensure that the permit-granting process for such projects do not exceed a predefined period.

Members proposed streamlining the permit-granting process, setting a deadline of 9 to 12 months for zero-net technology production projects and 6 to 9 months for strategic projects to be authorised.

Net-Zero Industry Valleys

The Regulation should promote the development of ‘net-zero’ industrial valleys with a view to fostering industrial symbiosis and encouraging Member States to make targeted investments in specific areas across Europe. These valleys should be geographically and technologically limited. Valleys should be designated by Member States and each designation should be accompanied by a Plan with concrete national measures to increase the attractiveness of the Valley as a location for manufacturing activities. Valleys should in particularly be used as a tool for re-industrialisation of regions, especially for coal regions in transition.

T9-0401/2023

Debate in Parliament

The Committee on Industry, Research and Energy adopted the report by Christian EHLER (EPP, DE) on the proposal for a regulation of the European Parliament and of the Council on establishing a framework of measures for strengthening Europe’s net-zero technology products manufacturing ecosystem (Net Zero Industry Act).

The committee responsible recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the proposal as follows:

Subject matter

The amended text stipulates that the draft Regulation establishes the framework of measures to ensure a coordinated approach, throughout the Union, to the innovation and scaling up of the manufacturing capacity of net-zero technologies as well as of the components, materials and machinery along the supply chains of those technologies that are indispensable for their production and functioning in the Union to:

- support the Union’s climate targets and climate neutrality objective;

- foster the Union’s international industrial competitiveness in order to contribute to the creation of quality jobs;

- improve the Union’s access to a secure and sustainable supply of net-zero technologies;

- strengthen Union’s open strategic autonomy;

- safeguard the resilience of the corresponding Union’s supply chains; and

- achieve the decarbonisation of the Union’s economy and society.

Scope and definitions

Members enlarged the scope of the proposed Regulation to include the components, materials and machinery along the supply chains of those technologies that are indispensable for their production and functioning. The meaning of ‘net-zero technologies’ has also been streamlined by the Members.

The net-zero technologies within the scope of this Regulation should be, inter alia :

- technologies used for production of energy from renewable sources;

- nuclear fission and fusion energy technologies, including nuclear fuel cycle technologies;

- energy storage technologies;

- carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O), removal, capture, transport, injection (EPP), storage and utilisation technologies;

- hydrogen (H2) transport infrastructure technologies;

- electrolyser and fuel cell technologies;

- electric, hydrogen (H2), sustainable alternative fuels and wind propulsion technologies for transportation;

- electric charging technologies for transportation;

- heat pump technologies;

- energy efficiency technologies;

- biomaterials production technologies, including bio-based chemical production technologies;

- recycling technologies.

Financing of net-zero technologies

The amended text suggested that Member States should allocate 25% of their national Emissions Trading System (ETS) revenues for expenditures aimed at achieving the objectives.

Net-Zero Industry Valleys

Members introduce the concept of Net-Zero Industry Valleys, aimed at fostering industrial symbiosis and encouraging Member States to make targeted investments in specific areas across Europe. Those Valleys should be limited in geographical and technology scope in order to promote industrial symbiosis. Valleys should be designated by Member States and each designation should be accompanied by a Plan with concrete national measures to increase the attractiveness of the Valley as a location for manufacturing activities. Valleys should in particularly be used as a tool for re-industrialisation of regions, especially for coal regions in transition.

A9-0343/2023

PE749.279

PE749.069

COM(2023)0161

PE753.568

PE753.533

PE752.781

COM(2023)0161

PE749.959

PE748.987

CES1157/2023

CDR2189/2023

COM(2023)0161

PE750.066

PE750.061

PE750.062

PE750.063

PE750.064

PE750.065

PE749.154

PURPOSE: to establish a framework of measures for strengthening Europe’s net-zero technology products manufacturing ecosystem (Net Zero Industry Act).

PROPOSED ACT: Regulation of the European Parliament and of the Council.

ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.

BACKGROUND: the EU has committed to achieve climate neutrality, including net-zero greenhouse gas emissions, by 2050. This objective is at the heart of the European Green Deal and in line with the EU's commitment to global climate action under the Paris Agreement. The Net-Zero Industry Act (NZIA) aims to scale up the manufacturing of technologies which are key to achieve climate-neutrality such as solar panels, batteries and electrolysers, among others, or key components of such technologies, such as photovoltaic cells or the blades on wind turbines. The Act will simplify the regulatory framework for the manufacturing of these technologies and therefore help increase the competitiveness of the net-zero technology industry in Europe. It will also accelerate the capacity to store CO2 emissions.

Together with the proposal for a European Critical Raw Materials Act and the reform of the electricity market design, the Net-Zero Industry Act sets out a clear European framework to reduce the EU's reliance on highly concentrated imports.

CONTENT: therefore, the Commission is presenting this proposal which seeks to establish the framework of measures for innovating and scaling up the manufacturing capacity of net-zero technologies in the Union to support the Union’s 2030 target of reducing net greenhouse gas emissions by at least 55 % relative to 1990 levels and the Union’s 2050 climate neutrality target and to ensure the Union’s access to a secure and sustainable supply of net-zero technologies needed to safeguard the resilience of the Union’s energy system and to contribute to the creation of quality jobs.

The proposal supports eight strategic net zero technologies . These are: (i) solar photovoltaic and solar thermal technologies; (ii) onshore wind and offshore renewable energy; (iii) batteries and storage; (iv) heat pumps and geothermal energy; (v) electrolysers and fuel cells; (vi) biogas/biomethane; (vii) carbon capture and storage (CCS); and (viii) grid technologies (which also include electric vehicles smart and fast charging).

To achieve the general objective, this proposed Regulation contains measures with a view to ensuring:

- that by 2030, manufacturing capacity in the Union of the strategic net-zero technologies listed in the Annex approaches or reaches a benchmark of at least 40% of the Union’s annual deployment needs for the corresponding technologies necessary to achieve the Union’s 2030 climate and energy targets;

- the free movement of net zero technologies placed on the Single market.

Where the Commission concludes that the Union is likely not to achieve the objectives set out above, it should assess the feasibility and proportionality of proposing measures or exercising its powers at Union level in order to ensure the achievement of those objectives.

The Net-Zero Industry proposal is built on the following pillars:

1. Setting enabling conditions : the proposal will improve conditions for investment in net-zero technologies by enhancing information, reducing the administrative burden to set up projects and simplifying permit-granting processes. In addition, it proposes to give priority to Net-Zero Strategic Projects, that are deemed essential for reinforcing the resilience and competitiveness of the EU industry, including sites to safely store captured CO2 emissions. They will be able to benefit from shorter permitting timelines and streamlined procedures;

2. Accelerating CO2 capture : the proposal sets an EU objective to reach an annual 50Mt injection capacity in strategic CO2 storage sites in the EU by 2030 , with proportional contributions from EU oil and gas producers. This will remove a major barrier to developing CO2 capture and storage as an economically viable climate solution, in particular for hard to abate energy-intensive sectors;

3. Facilitating access to markets : to boost diversification of supply for net-zero technologies, the draft Regulation requires public authorities to consider sustainability and resilience criteria for net-zero technologies in public procurement or auctions;

4. Enhancing skills : the proposal introduces new measures to ensure there is a skilled workforce supporting the production of net-zero technologies in the EU, including setting up Net-Zero Industry Academies , with the support and oversight by the Net-Zero Europe Platform. These will contribute to quality jobs in these essential sectors;

5. Fostering innovation : the Act makes it possible for Member States to set up regulatory sandboxes to test innovative net-zero technologies and stimulate innovation, under flexible regulatory conditions;

6. A Net-Zero Europe Platform will assist the Commission and Member States to coordinate action and exchange information, including around Net-Zero Industrial Partnerships. The Commission and Member States will also work together to ensure availability of data to monitor progress towards the objectives of the Net-Zero Industry Act. The Net-Zero Europe Platform will support investment by identifying financial needs, bottlenecks and best practices for projects across the EU. It will also foster contacts across Europe's net-zero sectors, making particular use of existing industrial alliances.

One-stop-shop

To increase efficiency and transparency, the Net-Zero Industry proposal will thus require Member States to set up one-stop shops that act as single points of contact for project promoters. These will facilitate and coordinate the entire permit-granting process and issue a comprehensive decision within the applicable time-limits.

Budgetary implications

The proposal establishes a Net-Zero Europe Platform. Heading 7 of the EU budget will support the organisation of the Net-Zero Europe Platform with a total of EUR 5.130 million for six officials. This translates into an annual expenditure of EUR 1.026 million. The staff will be responsible to carry out the tasks in relation to the Net-Zero Europe Platform as well as the Net-Zero Industry Academies as set out in this Regulation. Furthermore, the proposal estimates additional costs for committees with a budget of EUR 125.000.

The funding of the associated operational costs of this initiative will be supported by the budget for the ‘Operation and development of the internal market of goods and services’ under the current Multiannual Financial Framework until 2027.

In order to conduct research and data analysis for monitoring the initiative and market developments as well as to obtain up-to-date data on net-zero technology supply chains to tackle issues related to this Regulation a budget of EUR 720.000 is allocated.

This proposal will support Net-Zero Industry Academies with seed funding in form of EUR 3 million from the budget for the Clean Hydrogen Joint Undertaking and EUR 2.5 million from the budget of the Single Market Programme, SME pillar.

COM(2023)0161
EUR-Lex