Delivering an inclusive digital and green transition of Europe’s industry is crucial for EU’s cohesion and climate ambitions. The EU’s policy to reduce reliance on imports of critical raw materials and increasing the manufacturing of net-zero industry technologies has an enormous impact on regions and cities. Specific challenges of regional and local economies and communities need to be taken into account to strengthen Europe’s competitiveness and productivity and at the same time avoid growing territorial disparities. These are the main messages of two opinions on the Critical Raw Materials Package and on the Net-Zero Industry Act adopted during the plenary session of the European Committee of the Regions (CoR) on 5-6 July.
The preparedness and resilience of local and regional authorities (LRAs) for the green and digital transition is a key factor for the sustainability of public services in the era of growing dependence on net-zero technologies and critical raw materials, making it necessary for the regional perspective to be included in the newly proposed Critical Raw Materials Package and the Net-Zero Industry Act. The future of Europe’s competitiveness strongly relies on the diversification of external supplies of critical raw materials and the development of technologies that make the sustainable transition possible and ensure a European net-zero economy. It is crucial to ensure new sources of critical raw materials and net-zero energy technologies through circular use of resources, sustainable products and innovation, better domestic sourcing of raw materials and the EU’s net-zero technology products manufacturing ecosystem.
In the opinion on critical raw materials, which was adopted by unanimity, CoR members welcomed the European Commission’s proposal but stressed that skills and expertise in the former and active mining regions are important for the mining, extraction, and processing of critical and strategic raw materials. CoR Members also underlined the necessity to involve local and regional authorities in all processes and secure a place for a CoR representative, as a voice of European LRAs, in the Critical Raw Materials Board, a coordinating body envisaged in the European Commission’s proposal. Members furthermore underlined the importance of decentralised strategic stockpiling and highlighted that the EU recycling industry has great potential as a means of reducing the EU’s dependence on raw materials from third countries. CoR Members therefore supported the assessment of a more ambitious target for the recycling capacity of at least 20% of the annual consumption of each strategic raw materials.
The rapporteur of the opinion Isolde Ries (DE/PES), Mayor of West Saarbrücken District, said: “Electric cars, mobile phones, computers, wind power and solar systems: we need critical raw materials for a successful green and digital transition. The Covid-19 crisis and the Russian war of aggression against Ukraine have shown us how quickly and sustainably global supply chains can be disrupted. That’s why we have to become more independent from individual countries, expand our own resource capacities and significantly increase recycling rates. Industrial needs and environmental protection must go hand in hand.”
CoR members further adopted the opinion on the Net-Zero Industry Act, which welcomes the proposal to improve the investment climate for net-zero technology in Europe and stresses that regions would benefit enormously from more investment certainty, better policy coordination and a reduced administrative burden. LRAs are often directly affected by the measures proposed in the Act. It is therefore necessary to take a more pragmatic and wider approach so that the scope of the Act covers not only innovative net-zero technologies, but also the corresponding supply and value chains across borders. As local and regional authorities carry out procurement procedures and promote training and reskilling on net-zero technologies, it is crucial to involve them in the Net-Zero Europe Platform, in One Stop Shops and European Net-Zero Industry Academies.
Rapporteur Mark Speich (DE/EPP), State Secretary for Federal, European and International Affairs and Media, said on the margins of the plenary: “The NZIA aims to improve conditions for net-zero investments. It will streamline permit-granting processes. Since the law intervenes in many areas subject to regional competences, the sub-national level must be actively involved. Equally important is that the entire value chain and all suppliers are included. Net-zero will not be available without the steel or the chemical industry – just to mention a few. It must be ensured that net-zero investments are not contradicted by other pieces of EU legislation. EU legislation must be coherent!”
The European Commission published its proposal for a Net-Zero Industry Act (NZIA) on 16 March. The proposal is part of the Green Deal Industrial Plan, whose overall goal is to enhance the competitiveness of Europe’s net-zero industry and accelerate the transition towards climate neutrality. The NZIA aims to scale up clean-tech manufacturing in the EU with the ambition that the EU’s strategic net-zero tech manufacturing capacity should reach at least 40% of the Union’s annual deployment needs by 2030. ’Net-zero’ refers to technologies and investments that contribute to reducing or neutralising carbon emissions in a scientifically proven manner, reaching thresholds set by the Paris Climate Agreement.
The Critical Raw Materials Act, proposed by the Commission on the same day, leverages the strengths and opportunities of the Single Market and the EU’s external partnerships to diversify and enhance the resilience of EU critical raw-material supply chains. The Critical Raw Materials Act also improves the EU’s capacity to monitor and mitigate risks of disruptions and enhances circularity and sustainability.
Regions and cities are paving the way towards a transition to climate neutrality in industry, by attracting investments in green technologies and supporting the development of new skills. Watch here the video on regions’ and cities’ stories of making the transition happen, including the example of the project ‘Revierwende’ of the Saarland region in Germany.