The Industrial Decarbonisation Accelerator Act – and important that requires careful consideration

To strengthen the competitiveness of energy intensive industries and build on other existing or ongoing initiatives, the Commission intends to put forward the Industrial Decarbonisation Accelerator Act. The Act is a part of the actions envisaged in the Clean Industrial Deal and aims e.g. at addressing the challenges of lengthy permit-granting procedures for decarbonization projects and the lack of demand for clean industrial products at current prices compared to their conventional alternatives. Factors such as these contribute, according to the Commission, to a decline in industrial production and a challenging business environment for decarbonization investments.

In the reply, the Confederation of Swedish Enterprise highlights that a more systemic approach to streamlining the permitting policy needs to be undertaken by the Commission to ensure policy coherence between different legislations affecting the prerequisites for Member State’s permitting processes with the aim of reducing overlapping and cutting red tape. In that vein, the European Commission’s should undertake a regulatory fitness and performance check (REFIT) for the EU permitting legislation in order to ensure that EU permitting laws deliver on both the Clean Industrial Deal objectives and the objectives of the permitting legislations at a minimum cost for the benefit of citizens and businesses.

In addition, the Confederation of Swedish Enterprises advocates for restraint from the Commission and Member States regarding specific and targeted support to individual projects or clusters. Relying too heavily on a development path for European industrial policy where public authorities identify and promote specific projects risks fueling an application-driven economy that is not primarily focused on innovation. If EU policy in this area is put forward, it needs not to only promote late-movers laggards but rather also to encompass companies that have already started or are far advanced in their decarbonization projects.

Lastly, the Confederation of Swedish Enterprise also emphasizes that it is inherently harder for the public sector rather than for a market driven selection process to pick winners among different sectors, technologies and projects. The Commission and Member States should therefore be very cautious in weighing the advantages and disadvantages of various policy options that aim to strengthen so called “lead markets”. The main policy approach of the EU when incentivizing investments in decarbonization technologies should continue to be ambitious climate targets, the polluter pay principle of pricing of emissions and the harmonization of rules across the EU to provide for good framework conditions for businesses.

You can read more in the written contribution to the Industrial Decarbonisation Accelerator Act consultation here: