Industrial location Europe: EU plans billions for green technologies

Status: 02/01/2023 3:39 p.m

The US wants to invest 370 billion dollars in green technologies. EU Commission President von der Leyen is now reacting with countermeasures. Europe as an industrial location is at stake.

The EU Commission has presented proposals for a “Green Deal” for industry in order to be able to keep up with the USA and China in the competition for promising green technologies. In order to save Europe as an industrial location, the European Union must invest hundreds of billions in climate-friendly technologies, said EU Commission President Ursula von der Leyen. The industry is under a lot of pressure, not least because subsidies in countries like the US and China distort the competitive environment. It is necessary to expand and accelerate access to funding for the climate-neutral industry.

Response to economic aid abroad

In doing so, the EU is reacting, among other things, to the enormous economic aid of almost 370 billion that the USA wants to invest in climate-friendly industry. As von der Leyen emphasizes, other regions of the world are also arming themselves in the race for corresponding branches of industry with similarly large sums.

China has announced investments in clean technologies of more than 280 billion dollars. The EU fears that companies could set up new locations in countries outside the EU or relocate jobs there if they are not also supported with taxpayers’ money there. At the same time, the EU Commission wants to strengthen climate-friendly energy production in Europe with the initiative.

Faster approvals and subsidies

The proposals envisage making it easier for companies to build climate-friendly production plants in Europe with faster approvals – for example for CO2 storage, renewable energies and plants for the production of hydrogen. The member countries should also lower taxes for companies that might otherwise migrate to third countries.

In addition, the EU Commission wants to make it easier for member states to grant subsidies to companies. However, these are limited to certain areas and limited in time. It is planned that the requirements for state aid will be relaxed by the end of 2025. “We need this first step of funding now, so we can’t wait too long,” von der Leyen said. Accordingly, they should be granted for more technologies, be higher than before and be granted over a longer period of time.

planned sovereignty fund

Von der Leyen did not say exactly how much money is needed. She wants to make a proposal for a so-called sovereignty fund towards the middle of the year. This should ensure that the EU has sufficient funds for climate-friendly technologies. The President of the Commission emphasized that hundreds of billions are available in existing funds for a climate-friendly conversion. “At the moment we have to work with what we have right now,” von der Leyen said.

Criticism from the EPP, praise from the Greens

The economic policy spokesman for the conservative EPP group in the EU Parliament, Markus Ferber, called the proposals “expectably disappointing”. “That’s a very good suggestion,” said Federal Economics Minister Robert Habeck. “Above all, we need faster processes and better ways to promote the green technologies of the future,” said the Green politician.

Distortion of competition within the EU?

Even within the EU, there are concerns that now large countries like Germany, which can invest more money than others, could distort competition. The Commission’s proposal would help Germany and France extremely, said Green MEP Rasmus Andresen. He “actually doesn’t help at all” for many other states. That could lead to more inequality. The proposals are the basis for discussion at the EU summit starting next Thursday.

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