Changes from report parliamentary committee draft to plenary report

Added(2a) Any additional mobilisation of State aid should be targeted and temporary, and should be consistent with Union policy objectives such as the Green Deal and the European Pillar of Social Rights. Such financing should not lead to additional disparities among Member States in line with the Union's competition and cohesion policies.

RemovedRecital 15: (15) By defining CO2 storage sites that contribute to the Union’s 2030 target as net-zero technology manufacturing projects, the development of CO2 storage sites can be accelerated and facilitated, and the increasing industrial demand for storage sites can be channelled towards the most-cost-effective storage sites. An increasing volume of depleting gas and oil fields that could be converted in safe CO2 storage sites are at the end of their useful production lifetime. In addition, the oil and gas industry has affirmed its determination to embark on an energy transition and possesses the assets, skills and knowledge needed to explore and develop additional storage sites. To reach the Union’s target of 50 million tonnes of annual operational CO2 injection capacity by 2030, the sector needs to pool its contributions to ensure that carbon capture and storage as a climate solution is available ahead of demand. In order to ensure a timely, Union-wide and cost-effective development of CO2 storage sites in line with the EU objective for injection capacity, licensees of oil and gas production in the EU should contribute to this target pro rata of their oil and gas manufacturing capacity, while providing flexibilities to cooperate and take into account other contributions of third parties.

Added(2b) The International Energy Agency estimates that the global market for key mass manufactured clean energy technologies will be worth around USD 650 billion a year by 2030, which is more than three times the current level. The net-zero industry globally is growing at an increasing rate, to the extent of demand sometimes outpacing supply. The Union industry is part of an open, export-oriented, capital intensive, social market economy that can deliver prosperity for Union citizens only if it is competitive on and open to the global market. The Union’s ambition for the net-zero industry should be aligned with that reality and should aim to capture a significant global market share.

RemovedRecital 15 a (new): (15a) Additional policy effort is necessary to support the cross-border transportation of CO2 as the London Protocol initially prohibits export of CO2 for permanent geological storage below the seabed. The London Protocol was amended by contracting parties in 2009 to allow for cross border transportation of CO2 for sub-seabed storage, but the amendment must be ratified by two thirds of contracting parties to enter into force. It is unlikely that this will occur in the near term. Additional policy effort is necessary to address the barrier to deployment and the creation of an internal market for cross-border transportation of CO2.

Added(3) Regarding external aspects, the Union will step up its efforts to join forces with open, democratic partners committed to the Paris Agreement. Regarding emerging markets and developing economies, the Union will seek mutually beneficial partnerships in the framework of its Global Gateway strategy, which contribute to the diversification of its raw materials supply chain, to the achievement of global climate objectives as well as to partner countries’ efforts to pursue twin transition and develop local value addition.

RemovedRecital 15 b (new): (15b) Additional policy effort is essential to secure the deployment of cross-border infrastructure planning. Accessibility and connectivity of the full range of carbon dioxide (CO2) transportation modalities plays a critical role for the deployment of CCS and CCU projects. Modalities cover ship, barge, train and truck as well as fixed facilities for connecting and docking, for liquefaction, buffer storage and converters of CO2 in view of its further transportation through pipelines and in dedicated modes of transport.

Added(4) To fulfil those commitments, the Union must accelerate its pace of transition to a net-zero economy, including by increasing the share of clean energy in its energy mix, as well asby increasing energy efficiency and the share of renewable energy sources. This will contribute to achieving the Union targets of the European Pillar of Social Rights Action Plan for 2030 of an employment rate of at least 78% and participation in training of at least 60% of adults. It will also contribute to ensuring that the green transition is fair and equitable.

RemovedRecital 18: (18) Considering these objectives together, while also taking into account that for certain elements of the supply chain (such as inverters, as well as solar cells, wafers, and ingots for solar PV or cathodes and anodes for batteries) the Union manufacturing capacity is low, the Union net-zero technologies annual capacity should aim at approaching or reaching an overall annual manufacturing benchmark of at least 25% of global demand for net-zero technologies - defined in terms of the value of the demand and production.

Added(5) The higher energy prices after the unjustified and unlawful military aggression by the Russian Federation against Ukraine, gave a strong impetus to accelerate the implementation of the European Green Deal and reinforce the resilience of the Energy Union by speeding up the clean energy transition and ending any dependence on fossil fuels exported from the Russian Federation. The REPowerEU plan plays a key role in responding to the hardships and global energy market disruption caused by the invasion of Ukraine by the Russian Federation. That plan aims to accelerate the energy transition in the European Union, in order to reduce the Union’s gas and electricity consumption and to boost investments in the deployment of energy efficient and low carbon solutions. That plan sets inter alia the targets to double solar photovoltaic capacity by 2025 and to install 600 GW of solar photovoltaic capacity by 2030; to double the rate of deployment of heat pumps; to produce 10 million tonnes of domestic renewable hydrogen by 2030; and to substantially increase production of biomethane up to 35 billion cubic meters by 2030. The plan also sets out that achieving the REPowerEU goals will require diversifying the supply of low carbon energy equipment and of critical raw materials, reducing sectoral dependencies, overcoming supply chain bottlenecks and expanding the Union’s clean energy technology manufacturing capacity. As part of its efforts to increase the share of renewable energy in power generation, industry, buildings and transport, the Commission proposes to increase the target in the Renewable Energy Directive to 45% by 2030 and to increase the target in the Energy Efficiency Directive to 13%. This would bring the total renewable energy generation capacities to 1236 GW by 2030, in comparison to 1067 GW by 2030 envisaged under the 2021 proposal and will see increased needs for storage through batteries to deal with intermittency in the electricity grid. Similarly, policies related to the decarbonisation of the road sector, such as Regulation (EU) 2019/631 and Regulation (EU) 2019/1242 of the European Parliament and the Council will be strong drivers for a further electrification of the road transport sector and thus increasing demand for batteries.

RemovedRecital 19: (19) Increasing the manufacturing capacity of net-zero technologies in the Union will increase the global supply of net-zero technologies and the transition towards clean economic development globally. Together with other measures to enhance the Union’s competitiveness, measures to increase the manufacturing capacity in the Union will also ensure that the Union can play a dominant role in strategic parts of the value chain, including final products, to ensure the level of security of supply that the Union needs for the purpose of achieving its climate objectives.

Added(6) The net-zero transformation is already causing huge industrial, economic, and geopolitical shifts across the globe, which will become ever more pronounced as the world advances in its decarbonisation efforts. The road towards a climate neutral, resource-efficient and net zero economy translates into strong opportunities for the expansion of Union’s net-zero industry, making use of the strength of the Single Market, by promoting investment in net-zero technologies ▌and their supply chains. These are the technologies needed to deliver the objectives of the National Energy and Climate Plans, contributing to the resilience and competitiveness of Union industry, allowing for the decarbonisation of our economic sectors, from energy supply to transport, buildings, and industry. A strong net zero industry within the ▌Union can help significantly in reaching the Union’s climate and energy targets effectively, as well as in supporting other Green Deal objectives, such as creating quality jobs and sustainable growth, by creating an industrial base geared towards export as well as domestic supply.

RemovedRecital 21: (21) The manufacturing of net-zero technologies depends on complex and globally interlinked value chains. In order to maintain competitiveness and reduce current strategic import dependencies in key net-zero technology products and their supply chains, while avoiding the formation of new ones, the Union needs to continue strengthening its industrial base, both for net-zero technologies and for industry in their supply chains, and become more competitive and innovation friendly. The Union needs to enable the development of manufacturing capacity faster, simpler and in a more predictable way. The Transition Pathways that are being developed following the Updated EU Industry Strategy of 2021, will have to be updated to reflect the objectives of this Act and will identify enablers as well as bottlenecks for the transition and global competitiveness of European industry.

Added(7) To meet the Union’s climate and energy targets, energy efficiency needs to be prioritised. Saving energy is the cheapest, safest and cleanest way to meet those targets. ‘Energy efficiency first’ is an overall principle of Union’s energy policy and is important in both its practical applications in policy and investment decisions. Therefore, it is essential to expand the Union’s manufacturing capacity for energy efficient technologies, such as heat pumps and smart grid technologies, that help the EU reduce and control its energy consumption.

RemovedRecital 40: (40) Access to finance is key for ensuring the Union’s open strategic autonomy and for establishing a solid manufacturing base for net-zero technologies and their supply chains across the Union. The majority of investments necessary to reach the Green Deal objectives will come from private capital53 attracted by the growth potential of the net-zero ecosystem. Well-functioning, deep and integrated capital markets will therefore be essential to raise and channel the funds needed for the green transition and net-zero technology manufacturing projects. Swift progress towards the Capital Markets Union is thus necessary for the EU to deliver on its net-zero objectives. The sustainable finance agenda (and blended finance) also plays a crucial role in scaling up investments into the net-zero technologies, while guaranteeing the competitiveness of the sector.

Added(8) The Union’s decarbonisation objectives, security of energy supply, digitalisation of the energy system and electrification of demand, for example in mobility and the need for fast recharging points, require an enormous expansion of electricity grids in the ▌Union, both at transmission level and at distribution level. At transmission level, high-voltage direct current (HVDC) systems are needed to connect offshore renewable energies; while at distribution level, connecting electricity providers and managing demand-side flexibility builds on investments in innovative grid technologies, such as electric vehicles smart charging (EVSC), energy efficiency building and industry automation and smart controls, advanced meter infrastructure (AMI) and home energy management systems (HEMS). The electricity grid needs to interact with many actors or devices based on a detailed level of observability, and hence availability of data, to enable flexibility, smart charging and smart buildings with smart electricity grids and small-scale flexibility services enabling demand-side response from consumers and the uptake of renewables. Connecting the net-zero technologies to the network of the ▌Union requires the substantial expansion of manufacturing capabilities for electricity grids in areas such as offshore and onshore cables, substations and transformers.

RemovedRecital 40: (40) Access to finance is key for ensuring the Union’s open strategic autonomy and for establishing a solid manufacturing base for net-zero technologies and their supply chains across the Union. The majority of investments necessary to reach the Green Deal objectives will come from private capital53 attracted by the growth potential of the net-zero ecosystem. Well-functioning, deep and integrated capital markets will therefore be essential to raise and channel the funds needed for the green transition and net-zero technology manufacturing projects. Swift progress towards the Capital Markets Union is thus necessary for the EU to deliver on its net-zero objectives. The sustainable finance agenda (and blended finance) also plays a crucial role in scaling up investments into the net-zero technologies, while guaranteeing the competitiveness of the sector.

Added(8a) Clustering industrial activity directed towards industrial symbiosis can minimises the environmental impact of the activities as well as providing efficiency gains for industry. As such, clustering can contribute substantially to achieving the objectives of this Regulation. In this regard ; this Regulation promotes the development of Net-Zero Industry Valleys (Valleys). Those Valleys should be limited in geographical and technology scope in order to promote industrial symbiosis. Valleys should be designated by Member States and each designation should be accompanied by a Plan with concrete national measures to increase the attractiveness of the Valley as a location for manufacturing activities. Valleys should in particularly be used as a tool for re-industrialisation of regions, especially for coal regions in transition.

RemovedRecital 45: (45) Member States can provide support from cohesion policy programmes in line with applicable rules under Regulation (EU) 2021/1060 of the European Parliament and of the Council57 to encourage the take up of net-zero technology manufacturing projects in less developed and transition regions through investment packages of infrastructure, productive investment in innovation, manufacturing capacity in SMEs, services, training and upskilling measure, including support to capacity building of the public authorities and promoters. The applicable co-financing rates set in programmes may be up to 85% for less developed regions and up to 60% or 70% for transition regions depending on the fund concerned and the status of the region but Member States may exceed these ceilings at the level of the project concerned, where feasible under State aid rules. The Technical Support Instrument can help Member States and regions in preparing net-zero growth strategies, improve the business environment, reducing red tape and accelerating permitting. Member States should be encouraged to promote the sustainability of net-zero technology manufacturing projects by embedding these investments in European value chains, building notably on interregional and cross border cooperation networks. These kinds of measures should particularly be considered with regards to Net-Zero Industry Valleys.

Added(8b) Member States should be able to designate and support Valleys. When designating a Valley the Member State should draw up a plan for the Valley specifying which net-zero manufacturing activity is to be covered in the Valley (Plan). The Member State should also conduct environmental impact assessments as required for the net-zero manufacturing activities that are to take place in the Valley. Such impact assessments substantially limits the need for undertakings to perform those assessments for permits for the net-zero manufacturing activities in the scope of the Valley. The Plan should include the results of the environmental impact assessments as well as the national measures to be taken to minimise or mitigate negative environmental impact. The Plan should also include concrete national measures to support industrial activity in the scope of the Valley. Those measures should include measures to invest in or trigger private investment in energy, digital and transport infrastructure as well as measures to reduce the operational expenditure for the industry in the Valley, such as contracts of difference for energy prices. Other measures to be considered are measures to strengthen IP protection, the setting up of an innovation hub in the Valley as well as to attract start-ups to the Valley. In order to provide investment security for industry, the Plan should also specify the duration of the support measures.

RemovedRecital 48: (48) To overcome the limitations of the current fragmented public and private investments efforts, facilitate integration and return on investment, the Commission, and Member States should better coordinate and create synergies between the existing funding programmes at Union and national level as well as ensure better coordination and collaboration with industry and key private sector stakeholders. The Net-Zero Europe Platform has a key role to play to build a comprehensive view of available and relevant funding opportunities and to discuss the individual financing needs of net-zero technology manufacturing projects. The projects for discussion will be the ones brought forward by a Member State or Commission.

Added(9) Additional policy effort is necessary to support those technologies that are commercially available and have a good potential for rapid scale up to support the Union’s climate targets, improve the security of supply for net-zero technologies and their supply chains, and safeguard or strengthen the overall resilience and competitiveness of the Union’s energy system. It includes access to a safe and sustainable source of best-in-class fuels, as described in recital 8 of Commission Delegated Regulation (EU) 2022/1214.

Change 3

ChangedRecital 49: (49) In order for(10) net-zeroTo technologyachieve manufacturingthe projects2030 toobjectives bea deployedparticular orfocus expandedis asneeded quicklyon asthe possiblenet-zero tostrategic ensureprojects, thealso Union’sin securityview of supply fortheir net-zerosignificant technologies,contribution ittowards isthe importantpath to createnet planningzero andby investment2050. certaintyThese byprojects keepingplay thea administrativekey burdenrole onin projectthe promotersUnion’s toopen astrategic minimum.autonomy, Forensuring that reason,citizens permit-grantinghave processesaccess ofto theclean, Memberaffordable, Statessecure forenergy. netGiven zerotheir technologyrole, manufacturingthese projects should bebenefit streamlined,from whilsteven atfaster thepermitting sameprocedures, timeobtain ensuringthe thatstatus suchof projectsthe arehighest safe,national secure,significance environmentallypossible performant,under national law and complybenefit withfrom environmental,additional socialsupport andto safetycrowd-in requirements.investments. UnionTo environmentalbe legislationrecognised setsas commona conditionsstrategic forproject, the processproject andpromoter contentshould ofcomply nationalwith permit-grantingapplicable processes,obligations therebyin ensuringthe afields highof levelsocial ofand environmentallabour protection.law established by Union or national law.

Change 4

RemovedThe concept of Net-Zero Strategic Project is deleted throughout this Act so this stipulation is no longer relevant.

Added(10a) Net-zero strategic projects should be implemented sustainably by relying on the use of socially responsible practices including respect of human and labour rights, by meaningfully engaging with local communities and by relying on transparent business practices with adequate compliance policies to prevent and minimise risks of adverse impacts on the proper functioning of public administration, including corruption and bribery.

RemovedRecital 50: (50) At the same time, the unpredictability, complexity and at times, excessive length of national permit-granting processes undermines the investment security needed for the effective development of net-zero manufacturing projects. Therefore, in order to ensure and speed up their effective implementation, Member States should apply streamlined and predictable permitting procedures. In addition, Net-Zero Technology Manufacturing Projects should be given priority status at national level to ensure rapid administrative treatment and urgent treatment in all judicial and dispute resolution procedures relating to them.

Added(11) In order to ensure that the Union’s future energy system is resilient this scaling-up should be carried out across the whole supply chain of the technologies in question, in full complementarity with the Critical Raw Materials Act.

RemovedRecital 51: (51) Given their role in ensuring the Union’s security of supply for net-zero technologies, and their contribution to the Union’s open strategic autonomy and the green and digital transition, responsible permitting authorities should consider Net-Zero Technology Manufacturing Projects to be in the public interest. Based on its case-by-case assessment, a responsible permitting authority may conclude that the public interest served by the project overrides the public interests related to nature and environmental protection and that consequently the project may be authorised, provided that all relevant conditions set out in Directive 2000/60/EC, Directive 92/43/EEC and Directive 2009/147/EC63 are met.

Added(11a) Since 2007, the Strategic Energy Technology Plan (SET Plan) has been driving the Union's innovation in energy technologies. As such, the SET Plan has significantly contributed to strong knowledge base on energy technologies and has been essential for the alignment of strategic priorities on research, innovation and deployment of clean energy technologies. To ensure that the Union can deliver its full carbon-neutrality objectives by 2050, that knowledge base needs to be leveraged and further enhanced. The SET Plan is therefore an irreplaceable instrument for the achievement of the objectives of this Regulation and is the backbone for the innovation agenda of this Regulation.

RemovedRecital 53: (53) In order to ensure clarity about the permitting status of Net-Zero Technology Manufacturing Projects and to limit the effectiveness of potential abusive litigation, while not undermining effective judicial review, Member States should ensure that any dispute concerning permit granting process is resolved in a timely manner. To that end, national competent authorities should ensure that applicants and project promoters have access to a simple dispute settlement procedure and that net-zero technology manufacturing projects are granted urgent treatment in all judicial and dispute resolution procedures relating to them while ensuring respect for the rights of defence.

Added(12) In 2020 the ▌Commission adopted an EU strategy for energy system integration. It set out a vision on how to accelerate the transition towards a more integrated energy system, one that supports a climate neutral economy at the least cost across sectors. It encompasses three complementary and mutually reinforcing concepts: first, a more ‘circular’ energy system, with energy efficiency at its core; second, a greater direct electrification of end-use sectors; third, the use of renewable and low-carbon fuels, including hydrogen ▌.Considerations related to energy system integration refer to solutions for fully integrating all the electricity generated by renewable energy installations into the wider energy system. This means, for instance, adopting technical solutions that allow for the integration of surplus electricity generated by renewable electricity installations, including through storage and by expanding plannable fossil free power sources in the grid, in its various forms and demand-side management.

RemovedRecital 55: (55) Net-zero technology manufacturing projects undergo lengthy and complex permitting procedures of 2-7 years, depending on the Member State, technology and value chain segment. Considering the size of required investments – in particular for gigafactory-size projects which are needed to reach the expected economies of scale – inadequate permitting creates an additional and often detrimental barrier to increase net-zero technology manufacturing capacity in the Union. In order to provide project promoters and other investors with the security and clarity needed to increase development of net-zero technologies manufacturing projects, Member States should ensure that the permit-granting process related to such projects does not exceed pre-set time limits. For net-zero technology manufacturing projects, the length of the permit-granting process should not exceed 12 months for facilities with a yearly production output of more than 1 GW, and 9 months for those with a yearly production output of less than 1 GW. For net-zero technologies for which the GW metric is not relevant, such as grids and carbon capture and storage (CCS) or carbon capture and usage (CCU) technologies, the upper limits of the aforementioned deadlines should apply. For the expansion of existing production lines, each of the aforementioned time limits should be halved.

Added(12a) Carbon dioxide capture and storage (CCS) is a technology that will contribute to mitigating climate change. It consists of the capture of carbon dioxide (CO2) from industrial installations, its transport to a storage site and its injection into a suitable underground geological formation for the purposes of permanent storage.

RemovedRecital 56: deleted

Added(13) The development of carbon capture and storage solutions for industry is confronted with a coordination failure. First, despite the growing CO2 price incentive provided by the EU Emissions Trading System, for industry to invest into capturing CO2 emissions making such investments economically viable, they face a significant risk of not being able to access a permitted geological storage site. Second, investors into first CO2 storage sites face upfront costs to identify develop and appraise them even before they can apply for a regulatory storage permit. Transparency about potential CO2 storage capacity in terms of the geological suitability of relevant areas and existing geological data, in particular from the exploration of hydrocarbon production sites, can support market operators to plan their investments. Member State should make such data publicly available and report regularly in a forward-looking perspective about progress in developing CO2 storage sites and the corresponding needs for injection and storage capacities above, in order to collectively reach the Union-wide target for CO2 injection capacity. Third, CO2 storage projects are only economically viable when there is a business case along the full value chain, including transportation. Any legal storage obligations should therefore be accompanied by effective Union and national policies and measures to ensure coordination and investment across the value chain.

RemovedRecital 58: (58) Land use conflicts can create barriers to the deployment of net zero technologies manufacturing projects. Well-designed plans, including spatial plans and zoning, that take into account the potential for implementing net-zero technologies manufacturing projects and whose potential environmental impacts are assessed, have the potential to help balance public goods and interests, decreasing the potential for conflict and accelerating the sustainable deployment of net-zero technologies manufacturing projects in the Union. Responsible national, regional and local authorities should therefore consider the inclusion of provisions for net-zero technologies manufacturing projects when developing relevant plans. Net-zero Industry Valleys will provide Member States with an additional tool to combine public interests by maintaining environmental standards while accelerating the deployment of net-zero technologies.

Added(14) A key bottleneck for carbon capture investments that are today increasingly economically viable is the availability of operating CO2 storage sites in the Union, which underpin the incentives from Directive 2003/87/EC of the European Parliament and the Council. To scale up the technology and expand its leading manufacturing capacities, the Union needs to develop a forward-looking supply of permanent geological CO2 storage sites permitted in accordance with Directive 2009/31/EU of the European Parliament and of the Council. By defining a Union target of 50 million tonnes of annual operational CO2 injection capacity by 2030, in line with the expected capacities needed in 2030, the relevant sectors can coordinate their investments towards a Union Net-Zero CO2 transport and storage value chain that industries can use to decarbonise their operations. This initial deployment will also support further CO2 storage in a 2050 perspective. According to the Commission’s estimates, the Union could need to capture up to 550 million tonnes of CO2 annually by 2050 to meet the net zero objective, including for carbon removals. Such a first industrial-scale storage capacity will de-risk investments into the capturing of CO2 emissions as important tool to reach climate neutrality. In view of the expected storage requirements in 2050, the Union’s CO2 storage market will have to be complemented by a market that covers third countries in Europe with large storage potential. When this regulation is incorporated into the EEA Agreement, the Union target of ▌annual operational CO2 injection capacity ▌will be adjusted accordingly. To ensure the achievement of Union’s target, Member States should take the necessary measures to facilitate and incentivize the deployment of carbon capture and storage projects. Such measures should be able to include measures incentivizing emitters to capture emissions, funding support for investors for needed infrastructure to transport CO2 to the storage site and direct funding of CO2 storage projects.

RemovedRecital 62: (62) Net-zero regulatory sandboxes can be an important tool to promote innovation in the field of net-zero technologies and regulatory learning. Innovation needs to be enabled through experimentation spaces as scientific outcomes need to be tested in a controlled real-word environment. Regulatory sandboxes should be introduced to test innovative net-zero technologies in a controlled environment for a limited amount of time It is appropriate to strike a balance between legal certainty for participants in the Net-Zero regulatory sandboxes and the achievement of the objectives of Union law. As Net-Zero regulatory sandboxes must in any case comply with the essential requirements on Net-Zero technology laid out in Union and national law, it is appropriate to provide that participants , who comply with the eligibility requirements for Net-Zero regulatory sandboxes and who follow, in good faith, the guidance provided by the competent authorities and the terms and conditions of the plan agreed with those authorities, are not subject to any administrative fines or penalties. This is justified as the safeguards in place will, in principle, ensure effective compliance with Union or Member State law on the Net-Zero technology supervised in the regulatory sandboxes. The Commission will publish a Guidance for Sandboxes document in 2023 as announced in the New European Innovation Agenda to support Member States in preparing the net zero technology sandboxes. Those innovative technologies co…

Added(15) By defining CO2 storage sites that contribute to the Union’s 2030 target as net-zero technology manufacturing projects, or net-zero strategic projects, the development of CO2 storage sites can be accelerated and facilitated, and the increasing industrial demand for storage sites can be channelled towards the most-cost-effective storage sites. An increasing volume of depleting gas and oil fields that could be converted in safe CO2 storage sites are at the end of their useful production lifetime. In addition, the oil and gas industry has affirmed its determination to embark on an energy transition and possesses the assets, skills and knowledge needed to explore and develop additional storage sites. To reach the Union’s target of 50 million tonnes of annual operational CO2 injection capacity by 2030, the sector needs to pool its contributions to ensure that carbon capture and storage as a climate solution is available ahead of demand. In order to ensure a timely, Union-wide and cost-effective development of CO2 storage sites in line with the Union objective for injection capacity, licensees of oil and gas production in the Union should contribute to this target pro rata of their oil and gas manufacturing capacity, while providing flexibilities to cooperate and take into account other contributions of third parties. Licensees of oil and gas production within the Union should make every effort within their authority to undertake the requisite investments in order to meet their respective contribution towards the achieving of annual operational CO2 injection capacity. However, these efforts should be subject to objective commercial, financial, technical, legal, and environmental limitations beyond the control of these companies, which may lead to individual storage projects, despite reasonable and commercially prudent efforts, being objectively unable to be completed in time to fulfil the obligations set out under this Regulation.

RemovedRecital 63: (63) An overall benchmark and indicative objectives for the manufacturing of key net-zero technology products in the Union are put forward in order to improve the Union’s industrial global competitiveness as well as to help tackle import dependency and vulnerability concerns and ensure the Union’s climate and energy targets are met.

Added(15a) Additional policy effort is necessary to support the cross-border transportation of CO2 as the London Protocol initially prohibits export of CO2 for permanent geological storage below the seabed. The London Protocol was amended by contracting parties in 2009 to allow for cross border transportation of CO2 for sub-seabed storage, but the amendment must be ratified by two thirds of contracting parties to enter into force. It is unlikely that this will occur in the near term. Additional policy effort is necessary to address the barrier to deployment and the creation of an internal market for cross-border transportation of CO2.

RemovedRecital 68 a (new): (68a) The contribution of net-zero technologies to the decarbonisation objectives of the Union materialises only when technologies are deployed. Such a deployment will, to an extent, happen in private households, but most decarbonisation will come from decarbonising industrial processes. In order to ensure that investments for such decarbonisation take place in the Union, which is essential to secure good jobs and prosperity in the Union as well as for fulfilling the Union's decarbonisation objectives, it is crucial that it contributes to an improvement of the investment climate for industry in the Union.

Added(15b) Additional policy effort is essential to secure the deployment of cross-border infrastructure planning. Accessibility and connectivity of the full range of CO2 transportation arrangements play a critical role for the deployment of CCS and Carbon Capture and Utilisation (CCU) projects. Such arrangements cover ship, barge, train and truck as well as fixed facilities for connecting and docking, for liquefaction, buffer storage and converters of CO2 in view of its further transportation through pipelines and in dedicated modes of transport.

RemovedRecital 69: (69) At Union level, a Net-Zero Europe Platform, should be established, composed of the Member States and chaired by the Commission. The Net-Zero Europe Platform may advise and assist the Commission and Member States on specific questions and provide a reference body, in which the Commission and Member States coordinate their action and facilitate the exchange of information on issues relating to this Regulation. The Net-Zero Europe Platform should further perform the tasks outlined in the different Articles of this Regulation, notably in relation to permitting, including one-stop shops, Net-Zero Technology Manufacturing Projects, coordination of financing, access to markets and skills as well as innovative net-zero technologies regulatory sandboxes.

Added(15c) The Commission should ensure a continuous revision and extension of the CO2 injection capacity and storage target for the period post-2030 to reflect the needs of the Union to reach its 2040 climate target and climate neutrality by 2050 in synergy with related Union law.

RemovedRecital 69 a (new): (69a) For the effectiveness of the Platform, it is crucial that it can rely on timely input from the industrial actors for which the Platform is meant to create favourable conditions. Therefore, the Platform will set up a Net-Zero Industry Expert Group. This group will provide, on request or on its own initiative, advice to the Platform. Furthermore, where necessary the Platform may establish standing or temporary subgroups and invite third parties, such as experts or representatives from specific net-zero industries.

Added(15d) Using captured CO2 in certain production processes can permanently store CO2 and/or contribute to reducing the Union's dependence on fossil fuels. Therefore, all entities involved in the value chain of CO2 injection activities set out in this Regulation should be encouraged to consider if the CO2 that is to be stored could be permanently stored in new products or could support the Union's objectives to reduce its reliance on fossil fuels.

RemovedArticle 1 – paragraph 1: 1. This Regulation establishes the framework of measures for innovating and scaling up the manufacturing capacity of net-zero technologies in the Union to support the Union’s climate neutrality objectives, as defined by Regulation (EU) 2021/1119, foster the Union’s industrial competitiveness, which will contribute to the creation of quality jobs and to ensure the Union’s access to a secure and sustainable supply of net-zero technologies necessary to safeguard the resilience of the Union’s energy system.

Added(16) The Union has helped build a global economic system based on open, transparent and rules-based trade, pushed for respecting and advancing social and environmental sustainability and climate transition standards, and is fully committed to those values. The Union aims to level the playing field, in particular by fighting against unfair trading practices and production overcapacity, to secure a fair competitive environment for Union industry, including through net-zero industrial partnerships (Net-Zero Industrial Partnerships), providing quality jobs for workers.

RemovedThe Act will contribute to all climate neutrality objectives and its contribution to the 2030 objective will be a minor part of that contribution so a more general reference is more in line with what the Act will deliver.

Added(17) To address security of supply issues and contribute to supporting the resilience of Union’s energy system and decarbonisation and modernisation efforts, the net-zero technology manufacturing capacity in the Union needs to expand. Union manufacturers of solar photovoltaic (PV) technologies need to increase their competitive edge and improve security of supply perspectives, by aiming to reach at least 30 gigawatt of operational solar PV manufacturing capacity by 2030 across the full PV value chain, in line with the goals set out in the European Solar Photovoltaic Industry Alliance, which is supported under the Union’s Solar Energy Strategy. Union manufacturers of wind and heat pump technologies need to consolidate their competitive edge and maintain or expand their current market shares throughout this decade, in line with the Union’s technology deployment projections that meet its 2030 energy and climate targets. This translates into a Union manufacturing capacity for wind of at least 36 GW and, respectively, for heat pumps of at least 31 GW in 2030. Union manufacturers of batteries and electrolysers need to consolidate their technology leadership and actively contribute to shaping these markets. For battery technologies this would mean contributing to the objectives of the European Battery Alliance and aim at almost 90% of the Union’s battery annual demand being met by the Union’s battery manufacturers, translating into a Union manufacturing capacity of at least 550 GWh in 2030. For Union electrolyser manufacturers, the REPowerEU plan projects 10 million tonnes of domestic renewable hydrogen production and a further up to 10 million tonnes of renewable hydrogen imports by 2030. To ensure Union’s technological leadership translates into commercial leadership, as supported under the Electrolyser Joint Declaration of the Commission and the European Clean Hydrogen Alliance, Union’s electrolyser manufacturers should further boost their capacity, such that the overall installed electrolyser capacity being deployed reaches at least 100 GW hydrogen by 2030. The RePowerEU plan sets furthermore an objective of boosting sustainable biomethane production to 35 billion cubic meter by 2030. With its supply chain largely based in Europe today, biomethane already makes a contribution to Union’s resilience which should be further promoted.

Change 5

ChangedArticle(18) 1Considering –these paragraphobjectives 2together, –while pointalso a:taking a)into account that byfor 2030,certain manufacturingelements capacityof inthe supply chain (such as inverters, as well as solar cells, wafers, and ingots for solar PV or cathodes and anodes for batteries) the Union ofmanufacturing thecapacity net-zerois technologieslow, approachesthe orUnion’s reachesannual amanufacturing benchmarkcapacity ofshould ataim leastto 25%reachleast 40% of globalannual demanddeployment needs by 2030 for the correspondingnet-zero technologies necessarydefined toin achievethis RegulationMoreover, the Union’s climatenet-zero andtechnologies energyannual targets;manufacturing capacity should cover at least 25% of global demand for the corresponding technologies.

Change 6

RemovedArticle 1 – paragraph 2 – point b: b) the free movement of net zero technologies placed on and services offered in the internal market.

Added(19) Increasing the manufacturing capacity of net-zero technologies in the ▌Union will increase the global supply of net-zero technologies and the transition towards clean economic development globally. Together with other measures to enhance the Union’s competitiveness, measures to increase the manufacturing capacity in the Union should also ensure that the Union should play a dominant role in strategic parts of the value chain, including final products, to ensure the level of security of supply that the Union needs for the purpose of achieving its climate objectives.

RemovedArticle 2 – paragraph 1: This Regulation applies to net-zero technologies as well as to components, materials and machinery without which the net-zero technologies could not be produced, except for Chapter VI, Section I which applies to net-zero innovative technologies and Chapter VI, Section II which applies to all economic activities in the Union. Raw materials, processed materials or components falling under the scope of Regulation (EU) …/… [add footnote with publication references of the Critical Raw Materials Regulation] or under the scope of Regulation (EU) …/… [Chips Act] shall be excluded from the scope of this Regulation.

Added(20) At the same time, net-zero technology products will contribute to the Union’s resilience and security of supply of clean energy. A secure supply of clean energy is a prerequisite for economic development, as well as for public order and security. Net-zero technology products will also yield benefits to other strategically important economic sectors, such as farming and food production by securing access to clean energy and machinery at competitive prices, thus contributing sustainably to EU food security and to providing an increasing outlet for bio-based alternatives through circular economy. In the same way, the fulfilment of the Union’s climate ambitions will translate both into economic growth and social well-being.

RemovedArticle 3 – paragraph 1 – point a: (a) ‘net-zero technologies’ means any technology the application of which contributes to climate change mitigation within the meaning Article 10(1) of Regulation (EU) 2020/852 of the European Parliament and of the Council . / (deleted) / (deleted)

Added(21) The manufacturing of net-zero technologies depends on complex and globally interlinked value chains. In order to maintain competitiveness and reduce current strategic import dependencies in key net-zero technology products and their supply chains, while avoiding the formation of new ones, the Union needs to continue strengthening its ▌industrial base and become more competitive and innovation friendly. The Union needs to enable the development of manufacturing capacity faster, simpler and in a more predictable way by reducing the regulatory and administrative burden on industrial activities within its territory and levelling the playing field with international competitors. In particular, the Union should, by 2030, aim to achieve a 20% reduction of the general regulatory burden on industry, a 40% reduction of the regulatory burden for placing a new product on the internal market, and a 40% reduction of the administrative burden for SMEs and start-ups. Those efforts should, in particular, be made within the Better Regulation framework and without prejudice to the Union’s environmental and labour standards. The Commission should report on the progress towards these objectives in its Annual Burden Survey.

RemovedArticle 3 – paragraph 1 – point b: (b) ‘component’ means a manufactured part of a net-zero technology final product;

Added(21a) In order to ensure the Union’s access to a secure and sustainable supply of net-zero technologies needed to safeguard the Union’s resilience and in order to reach its climate neutrality targets, the internal market needs to be a supportive environment for innovation in net-zero technologies to take place. Innovation will be a crucial factor in ensuring the Union’s competitiveness as well as reaching net-zero objectives as soon as possible. Given the rapid developments in net-zro technologies as well as the significant regulatory guidance provided for the green transition, it is of utmost importance for the achievement of the objectives of this Regulation that the potential impacts of Union legislation and policy initiatives on innovation are thoroughly considered during their preparation, review and revision through the application of the innovation principle as set out in the Better Regulation Tool #22 as well as the Commission communication of 15 May 2018 entitled “A renewed European Agenda for Research and Innovation - Europe's chance to shape its future”.

RemovedArticle 3 – paragraph 1 – point b a (new): (ba) ‘materials’ means any raw or processed materials needed for the production of a component or final product of a net-zero technology