Changes from report parliamentary committee draft to plenary report

The Net-Zero Industry Act holds significant importance within a broader context that encompasses the urgent need to establish a compelling business case for industrial decarbonisation in Europe, aligning with the overarching goals of the Green Deal. Moreover, European industry faces a pressing challenge in terms of maintaining competitiveness on a global scale. While the Commission's initial proposal for the Net-Zero Industry Act aimed to address these concerns, it fell short of achieving comprehensive outcomes. In this regard, the present draft report represents a substantial improvement by introducing key enhancements.

Two primary improvements are worth highlighting: the streamlined definition of net-zero technologies and the expanded scope that encompasses the entire supply chain of such technologies. The draft report proposes referencing the Taxonomy to rationalise the definition, thereby avoiding the creation of an additional list and ensuring policy coherence throughout the Union.

A third crucial enhancement within the draft report lies in the inclusion of articles within the innovation chapter, strategically designed to enhance the overall competitiveness of European industry. Consequently, the chapter has been renamed "Innovation and Competitiveness" and divided into two sections: the first section focusing on innovation (Articles -26 to 26) and the second section devoted to competitiveness (Articles 26a to 27).

Shifting the Act's overarching objective from a benchmark based solely on domestic deployment needs to a benchmark emphasizing global market share assumes paramount importance for Europe's continued prosperity through export capacity.

Carbon Capture and Storage (CCS) emerges as a central issue within this Act. While appreciating the strong emphasis on ensuring the availability of storage capacity, it is vital to establish a functional market that encompasses the entire value chain, including capture, transport, storage, and usage. In light of this, the draft report proposes amendments to facilitate the functionality of this value chain.

Furthermore, the draft report introduces the concept of Net-Zero Industry Valleys, aimed at fostering industrial symbiosis and encouraging Member States to make targeted investments in specific areas across Europe.

A significant challenge that cannot be ignored is the lack of funding support for the Commission's initial proposal. To address this concern, the draft report recommends that Member States allocate 25% of their national Emissions Trading System (ETS) revenues for expenditures aimed at achieving the objectives set forth in this Act. By ensuring a dedicated financial stream, the Act can gain the necessary momentum for successful implementation.

In conclusion, the draft report represents a substantial step forward in refining the Net-Zero Industry Act. Through rationalised definitions, an extended scope, provisions for innovation and competitiveness, the pursuit of global market share, a functional approach to CCS, the concept of Net-Zero Industry Valleys, and dedicated funding mechanisms, the Act can more effectively propel Europe's industrial decarbonisation efforts while ensuring sustained competitiveness.