The EU should pass a new law to accelerate investment in clean technology and increase funding for the energy transition in response to the U.S. climate law, which the bloc fears unfairly subsidizes U.S. companies, Bloomberg reported.
“To keep European industry attractive, there is a need to be competitive with offers and incentives that are currently available outside the European Union,” Ursula von der Leyen, of the European Commission, said in a speech at the World Economic Forum in Davos on Tuesday. “To avoid fragmenting of the single market and to support the clean tech transition across the whole union, we must also step up EU funding.
As part of the new Green Deal industrial plan, she said, the EU must temporarily adapt its state aid rules to make them faster and easier, from calculations to approvals.
Her plan opens the door to funding the production of specific clean-tech projects through a “Net-Zero Industry Act,” similar to the EU’s Chip Act last year, and to simplifying and speeding up approvals.
Von der Leyen also called for a stronger response to China’s efforts to stimulate innovation and clean-tech production, as well as measures including large domestic subsidies and market access restrictions for EU firms.
“We still need to work and trade with China, especially when it comes to this transition,” von der Leyen noted, saying that “we need to refocus our approach on de-risking rather than decoupling.” She added: “We will not hesitate to open investigations if we consider that our procurement, or other markets, are being distorted by such subsidies.”
EU officials are increasingly skeptical that the U.S. is offering any major concessions on its climate law to benefit European companies. Some are still hopeful about the March changes, but officials have acknowledged that the amount of subsidies will be difficult to offset, no matter what changes are made.
