Facing stiff competition from countries with lower energy costs, the European Commission has outlined a bold strategy aimed at reviving Europe’s industrial base. At the heart of this initiative is the need to provide cheaper, cleaner energy—a critical component for both competitiveness and the ambitious decarbonisation targets set by the EU. Vice-President Teresa Ribera emphasized that “there is no economic resilience without a robust industrial component,” underscoring the urgency of retooling Europe’s energy infrastructure.
A flagship element of the plan is the establishment of an Industrial Decarbonisation Bank, designed to finance the transformation of industry. The bank is set to have a capital base of €100bn, sourced from voluntary state contributions (up to €30bn), the current European budget (€45bn), and future income generated from carbon emission rights (€25bn). This financial instrument is intended to catalyse investments in industrial decarbonisation and support projects that integrate clean energy technologies into manufacturing processes.
To ensure that the green transition does not come at an excessive cost to businesses or citizens, the Commission is also rolling out a Plan for Affordable Energy. This includes measures to lower gas and electricity prices, enhance interconnections across the trans-European energy grid, and introduce fiscal incentives such as tax reductions and the elimination of unnecessary surcharges on energy bills. In parallel, an omnibus package aimed at reducing bureaucratic burdens on companies is set to save annual administrative costs of at least €6.3bn. The proposals call for easing compliance obligations related to environmental standards and postponing certain regulatory requirements, while still maintaining the integrity of Europe’s climate objectives.
The industrial plan extends beyond energy. It includes commitments to workforce training, the development of trade and collaboration agreements, and measures to promote the circular economy and prioritise made-in-Europe products in public procurement. Additionally, the proposal suggests exempting small importers from the Carbon Border Adjustment Mechanism (CBAM) obligations, thereby reducing the regulatory load on SMEs while ensuring that 99% of carbon emissions remain covered.
Commissioners, including Vice-Presidents Ribera, Stéphane Séjourné, Dan Jorgensen, Wopke Hoekstra, and Valdis Dombrovskis, stressed that these measures are designed to create a more competitive, resilient, and sustainable European industry. As the EU navigates an uncertain global geopolitical landscape, these initiatives represent a concerted effort to secure prosperity and security by aligning industrial growth with the urgent need to combat climate change.
The comprehensive plan is now set to be discussed by the European Parliament and the member states, with hopes that it will pave the way for a new era of industrial and economic renewal in Europe.
