Confederation of Swedish Enterprise’s input on the EU Net-Zero Industry Act

The Confederation of Swedish Enterprise welcomes the European Commission’s initiative to improve the investment conditions for certain green technologies within the European Union. The green transition faces challenges from high energy prices in Europe and the continued lengthy and unpredictable permit processes. The ability to secure access to critical components and technologies remains an important issue for the business community, as is a stable supply of fossil-free energy at a competitive cost.

The Confederation of Swedish Enterprise wishes to stress the core values that are fundamental to the business community’s continued growth and opportunities to meet the climate challenges. Technology neutrality is a prerequisite for promoting new advances. Using legislation to control those existing technologies or materials that should be promoted risks placing important areas that are equally important for business growth and opportunities at a disadvantage in seeking to meet climate challenges, potentially distorting competition and even inhibiting new discoveries or innovations. In addition, the capacity for these companies to adapt will be greatly restricted if prevailing circumstances were to suddenly change.

The Confederation of Swedish Enterprise therefore advocates broader solutions, which promote business in general rather than selective initiatives and fast tracks for individual industries and technologies. For this reason, it is important that the increased priority that the Regulation gives to certain green technologies is not interpreted in a contradictory way. The Regulation should therefore state that the permit and enabling of other green technologies is also of great importance to European industry and the green transition.

The European Commission’s proposal has been developed with great urgency. While it is extremely important to drive the green transition and prioritise removing the barriers to business investment and a clear desire to realise the transition, the Commission must nevertheless make thorough proposals based on a detailed impact assessment. The proposal on net-zero industry has, however, not been preceded by any such impact assessment. A working document analysing the proposal is due to be presented by the Commission within three months of its presentation. And although such an analysis is to be welcomed, it is not in itself sufficient to replace a full impact assessment, which not only describes a submitted proposal, but also makes a broader analysis of the wider world and presents alternative courses of action. The Confederation of Swedish Enterprise believes that this approach is unacceptable, because it leads to less well-prepared proposals and limits the opportunities for stakeholders both to take a position on the Commission’s proposals and to make well-founded comments.

Furthermore, one can question the title of the proposal itself, which is rather misleading. Given that all the technologies included in the proposal relate in some sense to energy, consideration should be given to including the word ‘energy’ in the title of the proposal. This would be more consistent with the content of the proposal, which does not include any proposals for other types of technologies capable of playing an important role in the transition to net-zero emissions in various sectors, such as new technologies in the production of goods themselves. It would also pave the way for complementary future proposals from the European Commission, which could lead to a broader and more-generalised application of promotional measures for technologies that can support the green transition. In several places throughout the text - for example on pages 1-3 - the European Commission itself writes about ”net-zero energy technologies”. The title should therefore be ”Proposal for a Regulation of the European Parliament and of the Council on establishing a framework of measures for strengthening Europe’s net-zero energy technology products manufacturing ecosystem”.

Read more in our position paper below.