Europe’s Net Zero Industry Act sets an EU objective of reaching an annual 50Mt injection capacity in carbon dioxide (CO2) storage sites by 2030.
The Act will remove a major barrier to developing CO2 capture and storage as an economically viable climate solution, in particular for hard to abate energy-intensive sectors, according to an European Commission statement, as well as spur Net Zero technology manufacturing in the EU.
To further support the uptake of renewable hydrogen within the EU as well as imports from international partners, the Commission also presented its ideas on the design and functions of the European Hydrogen Bank.
Ursula von der Leyen, President of the European Commission, said we need a regulatory environment that allows us to scale up the clean energy transition quickly.
She said, “The Net Zero Industry Act will do just that. It will create the best conditions for those sectors that are crucial for us to reach Net Zero by 2050; technologies like wind turbines, heat pumps, solar panels, renewable hydrogen as well as CO2 storage. Demand is growing in Europe and globally, and we are acting now to make sure that we can meet more of this demand with European supply.”
The Commission also highlighted today the Critical Raw Materials Act, which will equip the EU with the tools to ensure access to a secure and sustainable supply of critical raw materials, mainly through setting clear priorities for action, and identifying a list of strategic raw materials which are key to industrial development.
Today, the EU meets 75% of its primary energy demand with fossil fuels, according to McKinsey, and five sectors emit the bulk of greenhouse gases: 28% comes from transportation, 26% from industry, 23% from power, 13% from buildings, and 13% from agriculture.
By 2030, 64% of the EU’s emissions reduction would be achieved by large-scale electrification and increases in energy efficiency, accounting for 47% and 17% respectively. Demand-side measures and circularity would reduce emissions an additional 15% while hydrogen would contribute another 13%.
The journey for any single technology from early-stage R&D and proof-of-concept to early deployment and commercial competitiveness ‘depends on a complex system of support models and stakeholders’.
McKinsey states achieving Net Zero by 2050 would require rapidly scaling cost-competitive technologies and business models to reduce near-term emissions; accelerating next-generation technologies and investing in enabling infrastructure to reduce emissions after 2030; and investing in R&D and negative emissions to close the gaps by 2050.
Global competition in the renewables sector has intensified following the passing of the Inflation Reduction Act in the US, which provides $370bn-worth of tax and production incentives.