Publications Europe Energy transition

From denial to acceptance: Europe’s next step in the cleantech race

15 September 2023 - Foreword of the week - By : Ciarán HUMPHREYS

Psychologists sometimes talk about the five stages of grief: denial, anger, bargaining, depression, and acceptance. One year on from the announcement of the US Inflation Reduction Act (IRA), the European response has looked startlingly similar. Public anger in Brussels at perceived American protectionism. Private sector depression at the prospect of Europe falling behind in the global cleantech race. Denial of the gap between the EU and US efforts, by arguing that that all EU and national spending on cleantech amounts to a conservative estimate of what the IRA offers (while not factoring in the full range of US support).

 

Meanwhile, the EU’s bargaining, with the proposal of the Net Zero Industry Act (NZIA) and the Strategic Technologies for Europe Platform (STEP), has attempted to square the reality of the cleantech race with the limited member state willingness to find an ambitious European solution. It is time to move forward towards acceptance. As Thomas Pellerin-Carlin outlined last February, the US (as well as China, Canada, Korea and other large economies) are betting big on cleantech. With the EU elections already next June, the EU should carefully consider how to best respond.

 

As Commission President Von Der Leyen made clear in Wednesday’s State of the Union speech, “the future of our clean tech industry has to be made in Europe”. To do so, the EU can look first to the tools it already has at its disposal – the most effective of these being the Innovation Fund. In this latest briefing, I4CE examines how Europe’s largest fund for climate innovation can be targeted to launch the next phase of the European Green Deal – and underpin the EU’s decarbonisation, energy security and economic competitiveness in the decades to come. With hard work and decisive action, it might help us move past the shock of the IRA.

 

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