The European Commission has officially presented the Clean Industrial Deal (CID), an ambitious roadmap aimed at strengthening EU industrial competitiveness while accelerating its transition to a low-carbon economy. The plan integrates strategies in energy, financing, the circular economy, and employment, with the goal of positioning Europe as a leader in clean technologies and ensuring a more resilient and affordable energy system.
“The Clean Industrial Deal is clear: homegrown energy-based electrification is the way to strengthen our industrial competitiveness,” stated Pierre Tardieu, Chief Policy Officer at WindEurope. The plan emphasises the need to accelerate permitting for renewables and expand power grids, both of which are essential for the energy transition.
Energy: access to affordable electricity and more efficient grids
One of the key pillars of the CID is ensuring affordable and clean energy for European industry. The high cost of electricity remains a barrier for energy-intensive sectors, prompting the Commission to include a Plan for Affordable Energy (AEAP) within the CID.
The CID aims to lower electricity costs through Contracts for Difference (CfD) and Power Purchase Agreements (PPA), enhance energy interconnection between Member States to increase system flexibility and promote digitalisation of grids using artificial intelligence to improve efficiency and supply stability. Additionally, it proposes a review of energy taxation, recommending lower electricity taxes for strategic industries.
The CID also highlights the importance of renewable and low-carbon hydrogen as a complementary solution to electrification. However, Hydrogen Europe warned that the EU has yet to adopt a truly integrated energy approach.
“The CID incentivises demand and rewards pioneers, but we must turn words into action. Without progress in the next 18 months, it is almost certain that we will not reach our 2030 climate targets,” warned Jorgo Chatzimarkakis, CEO of Hydrogen Europe.
Financing: over €100 billion for reindustrialisation
The Clean Industrial Deal seeks to mobilise over 100 billion euros to support clean reindustrialisation across Europe.
The European Commission plans to establish an Industrial Decarbonisation Bank, with 100 billion euros in funding for transitioning industries. The European Investment Bank (EIB) will also increase its support for clean manufacturing and grid expansion projects, and the Innovation Fund will receive an additional 6 billion in 2025 for low-emission technologies.
Tax incentives will play a key role in boosting investment in clean industries, with measures such as tax credits and accelerated depreciation. These mechanisms aim to reinforce the European industrial ecosystem against global competition, allowing businesses to invest in electrification and emissions reduction with greater financial certainty.
Circular economy: reducing waste and ensuring raw material independence
To reduce Europe’s reliance on critical raw materials, the CID places a strong emphasis on the circular economy. Among its key objectives is the implementation of the Circular Economy Act in 2026, which will include measures to boost reuse and recycling, aiming to reach 24% circular material use by 2030.
The CID also proposes greater support for the recycling industry, including incentives for scrap metal used in manufacturing, a revision of the value-added tax (VAT) system to encourage the purchase and reuse of second-hand products, and the creation of Transregional Circularity Hubs, which will coordinate recycling strategies among European countries.
This approach is key to reducing Europe’s dependence on imports and enabling industries to access high-quality recycled materials at competitive costs.
Employment and training: ensuring a just industrial transition
The CID also recognises the importance of a just transition for European workers. To this end, it proposes the creation of a Quality Employment Plan to ensure training, workforce transition, and social rights during the green transition.
The Union of Skills will be launched as a specialised training programme to meet the demand for clean technology jobs, while support for transitioning workers will include protection measures and investment in re-employment programmes. The CID also establishes a European Fair Transition Observatory, which will monitor the impact of the CID on employment and job quality, and introduces social clauses in public procurement, ensuring that decarbonisation investments benefit workers.
“The CID is not just an industrial plan; it is also a commitment to social cohesion. It is crucial that the transformation is inclusive and that the jobs created are of high quality,” stated the European Commission at the plan’s presentation.
A step forward, but challenges remain
The Clean Industrial Deal represents the largest reindustrialisation and decarbonisation effort in EU history. Its focus on affordable energy, massive financing, circularity, and quality employment marks a milestone in European strategy.
However, key players like Hydrogen Europe warn that the CID has yet to adopt a truly technology-neutral approach, which could limit the development of hydrogen and other alternative solutions.
Additionally, implementation will be critical: the plan’s success will depend on how quickly Member States adopt reforms and activate financing mechanisms.
As the global climate agenda progresses, the EU is betting on a sustainable, competitive, and resilient industrial model. The question remains whether this ambitious pact will translate into tangible results or, as some warn, remain only on paper.
Read the full CID document here:
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