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The Council of the EU and the European Parliament Reach a Preliminary Agreement on the Net-Zero Industry Act, Building Additional Momentum for CCS in the EU

13th February 2024

On Tuesday 6 February, the Council of the EU and the European Parliament reached a provisional agreement on the Net-Zero Industry Act (NZIA), a key legislation expected to drive the deployment of a wide range of net-zero technologies considered instrumental to support Europe’s decarbonisation efforts, including Carbon Capture and Storage (CCS).

Initially proposed in March 2023 by the European Commission as part of the Green Deal Industrial Plan, the NZIA aims to scale up EU’s manufacturing capacities of clean technologies needed to support the EU green transition towards a climate neutral economy.

As a result of the interinstitutional negotiations, the co-legislators agreed to broaden the set of clean technologies covered in the initial Commission’s proposal and decided to put forward a single list of net-zero technologies able to benefit from simplified administrative and permitting procedures. If certain criteria are met, these net-zero technologies can be supported via strategic projects, which are eligible for even quicker permit granting processes.

The provisional agreement also supports the EU target of 50 Mtpa CO2 injection capacity by 2030 initially put forward in the Commission’s proposal to accelerate the development of CO2 storage sites within the EU.

The co-legislators agreed on several additional measures to strengthen investments and projects in the EU’s net-zero industry, including:

  • The introduction of Net-Zero Acceleration Valleys, which Member States can leverage to facilitate the creation of net-zero industrial clusters and further streamline administrative procedures;
  • Sustainability and resilience criteria for certain net-zero technologies in procurement processes, which aim to facilitate net-zero products’ access to the market;
  • The creation of Net-Zero Industry Academies to enhance the skills of the European workforce needed to scale-up Europe’s net-zero technology manufacturing during the green transition.

The provisional agreement came at a critical time for the future  of carbon management and climate mitigation in Europe, following the European Commission’s release of the EU Industrial Carbon Management Strategy and the proposal of a new intermediate EU 2040 climate target, which were also announced on the 6th of February.

The provisionally agreed regulation now needs to be formally approved by the European Parliament and the Council of the EU. Once adopted by the two co-legislators, the NZIA will enter into force following its publication in the Official Journal of the EU.

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