100bn European Deal for Cleantech and Battery Recycling

The European Commission is embarking on an ambitious mission to accelerate the development and expansion of clean technologies and enhance the recycling of materials through a groundbreaking €100 billion ‘clean industrial deal’ and the introduction of a Circular Economy Act.

As part of this comprehensive initiative, there will be a heightened emphasis on grid technologies to establish a unified grid system spanning across Europe. Additionally, efforts will be made to streamline the involvement of small and medium-sized enterprises in these transformative endeavors.

Ursula von der Leyen, the President of the Commission, expressed confidence in Europe's capabilities, stating, “Europe possesses exceptional talent, accounting for a quarter of all clean tech patents globally, surpassing both the US and China in this domain.”

Highlighting Europe's robust infrastructure, von der Leyen cited the remarkable growth in the hydrogen sector, with a quadrupling of final investment decisions on electrolysers in Europe compared to the previous year, marking the fastest expansion worldwide. She affirmed Europe's unwavering commitment to its clear roadmap for sustainable development.

“Our focus is on fostering innovation like never before. Europe stands at the forefront of the global clean tech race, with 30% of innovative companies specializing in electrolyser technologies, 20% in carbon capture and storage, and a remarkable 40% in wind and heat pump technology. This positions us strongly against global competitors,” she emphasized.

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The Commission is confronted with overwhelming demand for the current Innovation Fund, which amounts to approximately €4 billion annually. In response, there are plans to mobilize up to €100 billion to establish a new Decarbonisation Bank to support the scaling up of clean technologies.

Furthermore, a new State aid framework will be introduced to expedite the approval process for state aid directed towards decarbonization and clean tech projects, ensuring greater predictability and accelerating innovation efforts.

With a specific focus on recycling, a significant agreement between Ukraine and the US is set to be finalized imminently, underscoring the importance of sustainable practices in the global economy.

“A third of all circular technology companies are based in Europe, with over 50% of steel, iron, zinc, and platinum production derived from recycled materials, meeting more than a quarter of European consumption needs. However, there is a pressing need to intensify and expedite these efforts,” von der Leyen remarked.

She drew attention to China's dominant position in global battery recycling capacity, emphasizing the untapped potential of end-of-life batteries to supply nearly 15% of the required lithium by 2030, sufficient for producing two million batteries for electric vehicles.

“To bolster this transition, the Commission will introduce a Circular Economy Act aimed at retaining critical raw materials within Europe, giving them a new lease on life. This not only benefits the environment but also bolsters our strategic autonomy,” she asserted.

The overarching goal is to establish a unified electricity grid spanning Europe to facilitate the seamless transfer of energy from production sites to consumption centers. The escalating costs associated with managing grid congestion, particularly from re-dispatching, reached a peak of €5.2 billion in 2022 and could surge to €26 billion by 2030.

“This initiative is geared towards expediting the adoption of clean energy and electrification, enhancing interconnections and grid infrastructure. Recently, I witnessed Lithuania's achievement of energy independence by integrating fully into the European grid, a move that signifies not just energy security but also sovereignty. It is imperative that we replicate this success continent-wide: interconnect our energy systems, upgrade our grids, streamline permitting processes, and make low-carbon energy accessible throughout Europe,” von der Leyen concluded.

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