• On February 26, the European Commission will unveil key pieces of its forward agenda. Taken together, the pieces will need to send coherent signals on the transition and direction of the European economy at times of crises. 
• The Commission’s flagship initiative, the Clean Industrial Deal, will  speak to the challenges and opportunities of both emerging clean-tech sectors and traditional energy-intensive industries.  
• The First Omnibus package on simplifying sustainability regulations, Second Omnibus package on simplifying investments and Action Plan for Affordable energy are also expected to be proposed
• Details of the EU’s 2040 climate targets may also be released on the day, unless they are pushed to later next month. 

Story

What will the details of the European Commission’s agenda under the second term of Ursula von der Leyen mean for Europe and the world: 

Delivering the new Commission’s agenda 

Wednesday’s announcements mark the first major moment unveiling details of the new Commission’s forward agenda. This comes at a time where Europe is faced by a complex set of challenges. What overarching strategy is the EU putting forward to deliver prosperity for its citizens, workers and companies in this increasingly volatile world?  

Responding to the crises facing Europe – from high energy costs and struggling industry to volatile geopolitics 

The Commission will need to respond to demands for short-term action and crisis-relief while accelerating the long-term energy and economic transformation that is underway. Signals on industrial transformation, simplification of sustainability rules and energy should send coherent signals on the Commission’s commitment to delivering the transition to citizens, businesses and international partners. It needs to signal to the world that Europe is not moving away from the transition but instead sees it as fundamental to delivering its competitiveness and prosperity goals. Europe should position itself as a trusted partner of choice at a time of geopolitical turbulence, offering opportunities for other countries’ clean economy transitions through accessible partnerships with sufficient funding that build on mutual interests. 

What does the Clean Industrial Deal mean for Europe’s climate leadership, competitiveness and the future of its industry? 

Bold action is needed on electrification, lead markets and funding to deliver the business case for industry decarbonisation. Strong international and social pillars are needed to deliver on Europe’s industrial objectives in an increasingly volatile world.  Crucially, it should set out how to better coordinating industrial policy to leverage regional advantages and make the tough political decisions lying ahead on what industries to support. 

Will the Omnibus and the EU ‘simplification’ agenda push the EU backwards on its sustainable transition by deregulating, or provide investors and business with certainty to continue moving ahead?

The Commission’s proposal to simplify the EU’s sustainable finance rules on sustainability reporting, due diligence and the EU Taxonomy should be targeted, not reopen the main legislation, and preserve the objective of these laws to provide information to investors and businesses and channel more finance to the transition. Market actors are looking for stability as well as simplification. The Commission should therefore avoid deregulating by changing the fundamental aspects of these rules, which would create confusion and cast doubt on the EU’s commitment to the transition. 

With energy prices in Europe at an all-time high, compared with other major economies, how can the Action Plan for Affordable Energy help to both lower bills in the short-term and address structural reforms to enhance energy system resilience?

The Commission’s  Action Plan should set out actions to lower the burden of high prices and advance the clean energy transition – these are mutually reinforcing policy goals. The Commission can propose measures to shift economic incentives towards efficient electrification and increase system flexibility to help decouple the retail price of electricity from volatile fossil prices. Targeted measures on energy efficiency will be needed in this Action Plan to support energy savings, spur demand for the clean heating and cooling sector, and to strengthen Europe’s security architecture. The EU’s dependence on fossil imports keeps energy prices high. Reducing this dependence in favour of clean, domestic electricity generation would be a sensible policy choice that supports decarbonisation objectives, energy system resilience, and reducing the high energy price burden on industry and citizens. 

Will the Commission finally formalise its 90% emissions reduction target for 2040 by putting forward a proposal to amend the European Climate Law? 

Setting a 90% Greenhouse gas reduction by 2040 would reaffirm EU’s international leadership in protecting the global climate regime at a time of crisis; reaching the goal would contribute to Europe’s energy independence and security by saving over €800 billion on fossil fuel imports between 2025 and 2040. 

Quotes

Manon Dufour, Executive Director, E3G Brussels said: 

“Curtains up for President von der Leyen and her new team of Commissioners. Wednesday’s release will show whether they can work together to chart a clear and convincing path forward for a competitive and sustainable Europe in a volatile and adversarial geopolitical context. Their task is to simplify without harming investors’ certainty; give a boost to European industries while reassuring international partners and get the ball rolling on the next decade’s emissions target.” 

Clean Industrial Deal 

Domien Vangenechten, Programme Lead on EU Industry at E3G, said:  

“Industries are on a knife-edge. Accelerating their decarbonisation presents the best bet to securing their future. The Clean Industrial Deal will need to balance short-term relief with long-term clarity and support, provide demand signals to create lead markets and set out a true European industrial policy. This will mean also taking bold political decisions on which parts of industrial supply chains really have a future in Europe.” 

Omnibus Package 

Jurei Yada, Director & Head of EU Sustainable Finance at E3G, said:  

“The Commission should not sabotage with the left hand what it sets out to do with the right. If the Commission’s Omnibus proposal compromises the fundamentals of the sustainability reporting, due diligence and taxonomy rules meant to ultimately deliver more finance to the transition, then its credibility will be questioned regardless of the signals it gives on clean industry and energy. Information from the weekend suggests the Commission has chosen deregulation over simplification, which if true would lead to chaos for businesses, investors and all those who have looked to the EU’s sustainable finance rules as signposts in their transition to a sustainable economy.” 

Action Plan for Affordable Energy 

Luke O’Callaghan-White, Programme Lead on EU Energy at E3G said:  

“The EU urgently needs a plan of action to address both the immediate challenge of stubbornly high energy bills and to tackle structural reforms to improve the resilience of the energy system. This Action Plan for Affordable Energy is a chance for the Commission to showcase its commitment to accelerating the clean energy transition by presenting tangible measures to alleviate the effects of fossil fuel price volatility on industry and household energy prices, and by supporting the clean, efficient electrification of Europe’s energy system.” 

International Dimension 

Anton Jaekel, Researcher German and EU Climate Foreign Policy at E3G said: 

“The Clean Industrial Deal is an opportunity for the EU to position itself as the partner of choice for third countries. Strengthening global cooperation through strategic partnerships and rebuilding trust will be essential for the EU to deliver its competitiveness and decarbonisation objectives amidst volatile geopolitics. Identifying areas of mutual benefit to grow clean markets internationally will enable the EU to drive global ambition, raise the bar for clean industrialisation and enhance its strategic autonomy.” 

Elisa Giannelli – E3G Programme Lead (EN, IT, FR) – EU politics, 2040 target 
Elisa.Giannelli@e3g.org | + 32 (0) 494 58 48 29 

Domien Vangenechten – E3G Programme Lead (EN, NL) – Clean Industrial Deal 
domien.vangenechten@e3g.org | + 32 (0) 474 871 827 

Jurei Yada – E3G Director (EN, PL, JP, FR) – Omnibus Package 
Jurei.Yada@e3g.org | +32 (0) 492 113 868 

Luke O’Callaghan-White – E3G Programme Lead (EN) – Energy Affordability Action Plan  
luke.ocallaghanwhite@e3g.org | +32 (0) 49 52 94 331  

Anton Jaekel – E3G Researcher (EN, DE) – International  
Anton.Jaekel@e3g.org | +49 (0) 160 2421044 

Notes to editors 

1. E3G is an independent climate change think tank with a global outlook. We work on the frontier of the climate landscape, tackling the barriers and advancing the solutions to a safe climate. Our goal is to translate climate politics, economics and policies into action. Climate in the European Union – E3G 
2. For further enquiries email press@e3g.org or phone +32 (0) 497 49 69 68.