GREEN DEAL INDUSTRIAL PLAN – ENVIRONMENT
News: European
Union unveils its ‘Green Deal Industrial Plan’: What does it entail?
What's in the news?
● In
a bid to support and expand its green industry, the European Union revealed the “Green Deal Industrial Plan” that aims
to cut red tape and provide massive subsidies.
Key takeaways:
● The
move has come just a few months after the United
States announced its Inflation
Reduction Act (IRA), which contains billions of dollars of tax cuts for clean energy and climate
change programs with incentives for US-based manufacturing.
Green Deal Industrial Plan:
● It
involves building a simpler regulatory
framework, providing faster access to funds, enhancing skills and improving
the EU’s trade network.
1. Simpler regulatory framework:
● The
plan seeks to formulate a “Net-Zero Industry Act”, which will not only simplify
rules but also speed up the issuance of permits
for green projects, such as renewable energy generation arrays, carbon
capture and renewable hydrogen production facilities.
● It
also includes a “Critical Raw Materials Act”, which will provide access to
materials like rare earths that are crucial for developing net-zero technology.
2. Providing faster access to funds:
● According
to the proposal, state aid rules will be loosened in order to help EU’s 27
governments with investing in the clean energy projects.
● The
plan allows countries to take money from existing EU funds.
● Notably,
the proposal doesn’t involve any fresh cash and seeks to direct €250 billion to
serve the green industry from the existing EU money, which is around €800
billion.
● It
also aims for setting up a “European
Sovereignty Fund” in the future to “give a structural answer to the
investment needs”.
3. Enhancing skills:
● The
plan aims to establish “Net-Zero
Industry Academies” that will provide up-skilling and re-skilling
programmes in strategic industries.
● According
to the European Commission’s website, 30 to 40 percent of the existing jobs
might get affected due to green transition. Therefore, the “Green Deal
Industrial Plan” focuses on developing the skills needed for well-paid quality
jobs.
4. Improving the trade network:
● The
plan underlines the importance of open trade and seeks to further “develop the
EU’s network of Free Trade Agreements and other forms of cooperation with
partners to support the green transition.”