08. 12. 2025
AUTHOR: Tristan Beucler
On 10 December the European Commission is set to publish its Industrial Accelerator Act (IAA). This is a crucial moment for the European Union (EU) to demonstrate its willingness to support its strategic industries in the face of low demand, high energy prices, and unfair international competition. The IAA can provide the necessary security while new industries emerge and energy-intensive industries decarbonise. To be effective, the IAA can create lead markets for net-zero technologies and low-emission materials, with binding sustainability criteria and Made-in-Europe conditions. The Commission has announced these objectives in the Clean Industrial Deal, European industrial frontrunners are calling for it, and 17 Member States have signed a declaration supporting this policy; now is the time to implement it.
Creating lead markets for net-zero products and technologies
This first major milestone of the Clean Industrial Deal can launch a long-awaited policy for the EU’s net-zero industries: the creation of lead markets. By securing a portion of the market for net-zero products and materials, this policy can create predictable demand for the next decade, supporting the necessary investments into decarbonisation. To be effective, this policy requires four crucial aspects:
- Support heavy industries in decarbonising their production, for instance, by introducing carbon footprint criteria in key sectors such as the automotive, wind turbines or railways to support the offtake of low-emission steel, aluminium, and other materials..
- Reward low-carbon products, thereby leveraging the existing competitive advantage of innovative, net-zero technologies and materials produced in Europe which tend to be less CO2-intensive than their international counterparts. For instance, batteries produced in the EU emit 37% less CO2 on average than Chinese batteries. This is an opportunity for the IAA to set the foundations for the swift industrial electrification of the EU.
- Include recyclability and circularity criteria to reduce the EU’s dependence on imported critical raw materials and the industry’s material and carbon footprint.
- Build on binding criteria rather than voluntary ones, creating real demand rather than relying on consumers’ willingness to purchase more expensive products.
Supporting European value chains with Made-in-Europe criteria
With its Industrial Accelerator Act, the Commission has an opportunity to signal its willingness to level the international playing field for EU industries. In the face of subsidised overcapacities from China, European net-zero manufacturers can see demand for their products secured by Made-in-Europe provisions for all forms of public support, including lead markets. Indeed, while the EU has a competitive advantage on carbon footprint for certain technologies and products, other industrial powers are swiftly catching up and could export low-emission products into the EU market in the coming years. There is a significant risk of resource shuffling, where companies export their least CO2-intensive products to the EU while continuing to produce fossil-based technologies and materials for their domestic market.
To avoid the risk of the IAA leading to more imports of net-zero products, Made-in-Europe criteria can be implemented directly and rely on three pillars:
- A market scope that covers sectors of strategic importance for the EU’s economic security and competitiveness, e.g. wind turbines, batteries, chemicals, grid-related technologies, and low-emission steel.
- A policy scope that covers all uses of public money in these sectors, beyond public procurement. This includes consumer bonuses, renewable energy auctions, State aid, and tax credits.
- A definition based on a percentage of added value in the EU to avoid the creation of assembly plants in the EU rather than real value chains.
These criteria can also be applied to other policies currently under discussion, such as the European Competitiveness Fund and the upcoming automotive package.
