Is the Clean Industrial Deal fit for purpose?

On 6 March, the European Economic and Social Committee (EESC) hosted a debate on the European Commission’s Clean Industrial Deal. With the Council set to discuss the deal on 12 March, policymakers, industry leaders, workers and civil society representatives weighed in on whether the plan can truly deliver for Europe’s clean-tech and energy-intensive industries, strategic autonomy and green transition.

Against the backdrop of geopolitical instability, including the ongoing war in Ukraine and shifting transatlantic relations, Europe’s need for strategic autonomy has never been more pressing. The Clean Industrial Deal aims to accelerate decarbonisation and circularity, while strengthening industrial competitiveness, starting from lowering energy prices, but questions remain over its feasibility and funding.

Pietro de Lotto, President of the Consultative Commission on Industrial Change (CCMI), framed the challenge as a balancing act: ‘The question is not to choose between strategic autonomy, competitiveness or the twin transition. All industrial sectors are concerned and must adapt, at their own pace but with clear commitments.’

Outi Slotboom, Director for Strategy & Economy Analysis at DG GROW, reinforced the urgency of the situation, stating: ‘The Commission has decided very clearly that we need to become energy independent from Russia. It is a geopolitical necessity.’

Despite this, Europe’s industrial decline is a growing concern, with Ms Slotboom highlighting that industrial output and foreign direct investment inflows have both dropped significantly in the past two years.

Funding challenges and social costs

A recurring theme throughout the debate was the challenge of securing adequate funding for the Clean Industrial Deal’s ambitious objectives.

Speakers explained that achieving these objectives would require joint efforts from EU institutions, Member States and industry stakeholders. While the European Investment Bank (EIB) has pledged EUR 500 million in counter-guarantees and EUR 1.5 billion for improving EU energy grids, national governments will need to raise additional resources.

Concerns over financing the transition featured prominently in the discussion. Monika Antosik, Environmental Attaché at the Polish Permanent Representation to the EU, welcomed the deal’s focus on decarbonisation and energy efficiency but raised concerns about its financing. ‘There is a lot of good intent in the plan,’ she said, ‘but we need to go deeper into the details. The question of how to fund these transitions is still unclear.’

Benjamin Denis, Head of Industrial Policy Coordination at IndustriAll, echoed these concerns, particularly around the social implications of the plan: ‘The industrial sector, especially in energy-intensive industries, has faced serious job losses in recent years,’ he noted. ‘We need to ensure that the Clean Industrial Deal takes into account the social impact of these transitions in this context of austerity. We need a skilful workforce.’ He wondered whether reducing taxes on energy, a key proposal, would come at the cost of education and healthcare funding.

The race against time

Despite the optimism surrounding the Clean Industrial Deal’s long-term goals, experts raised concerns about its ability to address short-term challenges.

Alexandre Affre, Deputy Director General of Business Europe, emphasised the need for speed and simplification: ‘This is an improvement over past frameworks, but execution will be key. Energy costs remain too high in the short term, and the EU needs to remove unnecessary barriers and speed up deployment of clean technologies.’ He also stressed the importance of technological neutrality, questioning whether the current plan would deliver the right mix of renewable, hydrogen and biofuel solutions.

Chiara Martinelli, Director of Climate Action Network (CAN) Europe, praised the deal’s emphasis on renewables but called for strong commitments on energy efficiency: ‘There is no space for fossil fuels in Europe’s future. We need to be clear about that.’ She pointed out that renewables had already saved European consumers EUR 100 billion between 2021 and 2023, a success story the EU should build on.

The challenge of coordination remains another key hurdle. With national policies still fragmented, Martinelli warned: ‘The Clean Industrial Deal misses a vital opportunity to align industrial policy across Europe.’

The road ahead

With the Council set to meet in mid-March, the stakes for the Clean Industrial Deal remain high. While the goals of decarbonisation, competitiveness, and strategic autonomy are clear, the debate revealed significant concerns about execution, financing and social impact. Achieving strategic autonomy and a sustainable transition will require not just ambitious policies but also a very strong political will to implement concrete decisions and financial commitments from both EU institutions and Member States.