A key day for climate action and European industrial sovereignty

Today is an important but contradictory day for European climate action. With the Clean Industrial Deal, Europe confirms its commitment to accelerate its decarbonization agenda, reaffirms its climate ambitions for 2040, while the Omnibus package weakens certain foundations of the Green deal.

First of all, the European Commission has presented the Clean Industrial Deal : an action plan which consolidates the conditions for success for Europe's competitiveness, climate and economic security! With the Clean Industrial Deal, Europe confirms the pursuit of its decarbonization agenda and remains consistent with the climate ambitions of the Green Deal. This strategy broadly incorporates the priorities of the Renew group: lowering energy prices, increasing investment in decarbonization and the deployment of carbon-free energies, ensuring outlets for our green industrial production, and protecting the European market from unfair competition. I particularly salute the role of the Executive Vice-President for Prosperity and Industrial Strategy Stéphane Séjourné, who has raised the ambition of this strategy.

Then, the Commission also confirmed its 2040 greenhouse gas reduction target will be specified in the coming months. The commission is right to commit as planned to putting our future 2040 climate target on the table. There is no doubt that some governments will oppose it in the Council and it will be a tense debate in Parliament. For my part, I consider that quickly adopting this amendment to the climate law is important to provide clarity to economic players and investors. We must always remember: the decarbonization of our economy is our interest. Every year we buy more than 400 billion worth of gas and oil. We should instead keep that money at home to invest in decarbonization !

However, in the short term, the simplification measures announced today weaken important texts of the Green deal. The European Commission is weakening some of the tools for Europe's economic and industrial transformation, notably the CSRD. If we have succeeded in preserving in the discussions of the last few days the heart of the CSRD, namely the dual materiality and an approach which is not limited to the climate, the drastic reduction in the scope of application of the CSRD weakens a tool whose objective, is to attract private capital to finance decarbonization, which is nevertheless the ambition set by the Clean Industrial Deal. We are also depriving ourselves of datas which will be key to building the Capital Markets Union with the same language for all or to organizing access to the European market for more sustainable or locally produced products. Finally, for the carbon border adjustment mechanism, the measures proposed by the Commission will facilitate its implementation and this poses no problem provided that the new passage of the text in the European Parliament does not put it at risk in the context of a possible alliance between the right and the far-right.

As attacks on our European democratic model increase, we must reassert our strengths, and not try to be a pale copy of the United States. In this context, the Clean Industrial Deal is an agenda for more Europe and more cooperation between European member states. This is the opposite of the Trumpian agenda. This Clean Industrial Deal cannot be achieved with the European friends of Trump and Putin but only with central pro-European political forces. I will participate very actively in the European Parliament.

Here is my analysis of some major measures announced today:

Put an end to European naivety with Made in EU and a fair competition framework

Revolution in Brussels: the Clean Industrial Deal provides for the introduction of local content criteria to boost Made in Europe. Next year, the European Commission will present a reform of public procurement to incorporate a European preference. At the same time, in the future Industrial Decarbonization Accelerator Act, criteria (environmental, circularity, resilience, cybersecurity) will be introduced to promote green products manufactured in Europe.

The Carbon Border Adjustment Mechanism (CBAM) is obviously part of this alignment of European industry with our climate objectives : this mechanism which makes importers of steel, aluminum, cement, fertilizers and electricity pay the carbon price, puts our industry on an equal footing with the rest of the world.

Today the CBAM is experiencing a double movement : its implementation for European importers is simplified to focus on products representing the overwhelming majority of our imported emissions - the transitional period of the CBAM has been designed to allow these technical adjustments; and it is at the same time announced that its scope of application will be extended in particular to downstream sectors to protect more companies.

Funding to support EU decarbonization and clean technologies

This was one of the key conclusions of the Draghi report: additional European investment estimated at between 750 and 800 billion per year is necessary to achieve our objectives. Good news: the Clean Industrial Deal will mobilize €100 billion to support decarbonization and European clean technologies!

While awaiting the proposal on the Capital Market Union, the Commission is proposing tools to derisk and mobilize private capital. This will involve strengthening Invest EU, which will mobilize €50 billion in additional funding, the creation of an industrial decarbonization bank and the mobilization of ?€1 billion euros as part of the innovation fund to support the cleantech sectors and the decarbonization of European industrial sites. At the same time, the Clean Industrial Deal strengthens financing at European level with the creation of a new instrument dedicated to decarbonization projects and electrification, thanks to revenues from the carbon market. Finally, state aid reform will aim to increase national support for decarbonization projects and green value chains.

Getting out of our dependence on fossils is essential to ensure our sovereignty

We must continue to accelerate the energy transition to move away from our dependence on fossil fuels. This requires adding solutions, and putting an end to the polarization between renewables and nuclear. The Clean Industrial Deal lays all the building blocks of our strategy to build a true zero-fossil energy Union. We must produce more clean energy (renewables and nuclear), develop the European network, particularly interconnections, and make greater use of flexibilities, including storage. This is what will ultimately make it possible to strengthen the competitiveness of the European bloc in the face of economic competitors like China and the United States.

Ensuring affordable energy prices is crucial, especially for our industries. As requested by the Renew group, the European Commission is proposing to de-risk PPAs by offering counter-guarantees via the European Investment Bank. It was a missing instrument, which will make it possible to accelerate the use of this type of long-term contracts for European manufacturers, thus protecting them from the volatility of energy prices.

Omnibus

This is where the problem lies. If we have managed to preserve in the discussions of the last few days the heart of the CSRD, namely the double materiality and an approach which is not limited only to the climate, and if positive elements are on the table, such as the protection of excessive reporting requests for SMEs or clear indications on the limits of the audit, several provisions are problematic : by reducing the number of companies concerned, we are reducing the scale of the CSRD and weakening a tool making it possible to attract private capital to finance decarbonization which is nevertheless the ambition set by the Clean Industrial Deal.

Faced with the challenges of global competition for the deployment of green industries in which China and the US are engaged, faced with the urgency of creating the union of capital markets for which the CSRD will provide the common language, we cannot afford to be half-hearted on the tools for financing the transition and sovereignty: we need all of them. I can only note that the Commission's proposal on the CSRD is inconsistent with the ambitions we set for ourselves. I also remain extremely vigilant: the future voluntary standard for companies with fewer than 1,000 employees must not be a means of going back on the central principles of the CSRD such as double materiality.

On taxonomy, the proposal to make it optional amounts to emptying it of its meaning. It must be simplified, it must not be de facto eliminated.

On the duty of vigilance (CSDDD), I note that the Commission's proposal Europeanizes the German model. German experts tell us this is a missed opportunity to fix flaws in German law. Fortunately, in what looks like a massive deregulation of this text, we have managed to preserve the transition plans.

In the end, I note that the reforms of the CSRD and the duty of vigilance are made "tailor-made" for German companies since they remove German mid-sized companies from the scope of the CSRD and copy and paste the European duty of vigilance on the German model. This is not without raising questions, particularly for large French companies...

The various texts are now reaching the European Parliament. I will work with the pro-European forces in Parliament because we cannot build the future of our Europe without this alliance. This is, today, one of our greatest responsibilities.

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