The start of 2025 has been marked by a series of significant EU policy developments, shaping the first 100 days of Ursula von der Leyen’s second term as President of the European Commission. The publication of the Competitiveness Compass on 29 January set the tone, followed by the European Commission Work Programme 2025 on 11 February. Then, on 26 February, the long-awaited Clean Industrial Deal (CID) was unveiled, outlining a strategy to enhance both competitiveness and the decarbonisation of European industries. On the same day, the Commission launched two complementary initiatives: the Affordable Energy Action Plan (AEAP) and the Omnibus Simplification Package, both designed to foster sustainable industrial competitiveness through distinct yet interconnected measures. 

Building on the 2024 Antwerp Declaration for a European Industrial Deal, the CID provides a framework focused on two core objectives: accelerating clean technology adoption and enhancing energy efficiency in energy-intensive industries to strengthen competitiveness while ensuring climate neutrality. To achieve these goals, the Deal identifies several economic levers: reduced energy costs, robust demand for clean products, increased circularity, access to critical materials, a skilled workforce, and international cooperation. Key measures include the Industrial Decarbonisation Accelerator Act to expedite permitting for industrial decarbonisation, a revision of the EU’s Public Procurement Framework in 2026 introducing a “European preference criterion” for strategic sectors, and a demand aggregation platform for critical raw material procurement. The plan also proposes Clean Trade and Investment Partnerships with like-minded global allies and envisions a Union of Skills to support the human capital needed to drive the required industrial transformation across the EU. 

In terms of financing, the Deal foresees substantial funding for high-quality projects supported by the Strategic Technologies for Europe Platform (STEP) and recognised with the STEP Seal, a quality label for promising initiatives in clean tech, resource efficiency, deep tech, and digital innovation. Financing for these projects will come from the Innovation Fund, which is supported by revenue generated through the Emissions Trading System (ETS). The European Investment Bank is also set to introduce new financial instruments to support the CID’s objectives, while Horizon Europe will remain a key funding tool, with the Commission announcing a €600 million call under the 2026-2027 work programme to support deployment-ready projects. Furthermore, the Commission aims to mobilise over €100 billion through an Industrial Decarbonisation Bank, to be established in 2026, also to be funded via the Innovation Fund and governed within the future European Competitiveness Fund (ECF), an initiative designed to act as a one-stop shop supporting science and technology-based companies ensuring their growth within Europe. 

In its initial appraisal, EERA broadly welcomes the Clean Industrial Deal for its push towards an all-encompassing, strategic and geopolitically fit industrial transformation, which aligns with the EU’s climate neutrality goals. However, several points require attention. A major concern is the proposed ECF, with recent intelligence suggesting that the next Framework Programme (FP10), to follow the current Horizon Europe, could be integrated into this broader instrument within the Multiannual Financial Framework (MFF) 2028-2034. EERA firmly opposes this shift, advocating for research and innovation funds to remain under a dedicated, ring-fenced instrument, protected from flexible allocation based on changing political priorities. A standalone Framework Programme 10, with a substantial funding increase, is essential to ensuring that research and innovation remain at the heart of Europe’s economy, as envisioned by President von der Leyen in her Political Guidelines. It will also be vital that the upcoming Framework Programme preserves the crucial role of pre-competitive R&I, maintaining the role of what is currently Horizon Europe’s Pillar II. Indeed, cross-sectoral, cross-border, and interdisciplinary pre-competitive R&I has proven key to harnessing researchers’ creativity and expertise to develop breakthrough innovations, ultimately significantly boosting the EU’s competitiveness. 

Another key issue identified by EERA is the CID’s strong focus on high-TRL (Technology Readiness Level) technologies. The only notable reference to disruptive innovation is the proposed TechEU investment programme, which aims to support sectors such as AI, clean tech, critical raw materials, energy storage, quantum computing, and semiconductors. This approach, however, falls short of addressing the need for a broader perspective that considers the entire TRL scale, particularly when competitiveness is at stake. While R&I is acknowledged as an enabler of next-generation clean tech and streamlining instruments remains a Commission priority, EERA sees the absence of the Strategic Energy and Technology (SET) Plan as a significant omission in the document. As the EU’s main framework for coordinating efforts on low-carbon technologies and fostering collaboration between industry, academia, and policymakers, its exclusion indeed raises concerns about the coherence of EU industrial, trade, and R&I policies, particularly when an integrated approach is vital to strengthening competitiveness while achieving climate neutrality. 

On a positive note, the SET Plan is explicitly referenced in the Affordable Energy Action Plan, published alongside the CID, where it is recognised as a key complement to the Energy Union in addressing the current fragmentation in the EU’s R&I portfolios for clean energy and electrification. EERA is pleased that the Commission envisions using this tool to foster innovation, notably through coordination with Member States via the SET Plan Steering Group: a process in which EERA is ready to play a key role as the formal research pillar of the SET Plan. The AEAP also highlights the need to increase R&I investment to reach the 3% of GDP target, a goal EERA strongly supports. Additionally, it underscores AI-driven research within a Strategic Roadmap for Digitalisation and AI in the Energy Sector, which is also timely and welcomed by EERA. 

In more broad and general terms, while the CID and AEAP prioritise prices, competitiveness, and industry in classical economic terms, climate considerations appear once again to be taking a backseat, as already noted in other instances under the new EU institutional mandate. The only notable reference to climate concerns in the CID is the Commission’s reaffirmation of its commitment to proposing an ambitious EU 2040 climate target, aiming to cut greenhouse gas emissions by 90% from 1990 levels. However, this target has yet to be formally proposed and will require extensive negotiation by the Parliament and Council before becoming law, making the reference more aspirational than concrete and operational. This trend is further illustrated by the Omnibus Simplification Package, released alongside the CID and AEAP, which proposes delaying implementation and lowering the ambition of key Green Deal initiatives, including the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD). 

In conclusion, while the Clean Industrial Deal and its complementary initiatives represent significant steps toward a decarbonised and competitive European industry, EERA believes greater attention must be given to the role of low-carbon energy research and innovation in this process. This is essential for providing concrete solutions to this dual challenge and supporting the transition to a sustainable, climate-neutral, and competitive economy. The focus on high-TRL technologies, the omission of the SET Plan in the CID, and the potential integration of the next Framework Programme into the European Competitiveness Fund raise important concerns. EERA will continue to advocate for low-carbon research and innovation that ensures a seamless continuum from early-stage development to market uptake through a balanced, integrated, and forward-looking approach that will be crucial as the EU moves forward.