The European Commission signalled plans to progress decarbonisation, electrification and competitiveness in a Communication on the Clean Industrial Deal and an Action Plan for Affordable Energy.

An aim is to increase sustainable and resilient production in Europe.  Six drivers to support the industrial ecosystem are being pursued, including affordable energy and financing.

Notably, there are plans to explore various routes to funding grid development. The Commission also states that a fast increase in PPAs and CfDs is key to making clean energy production more attractive for industrial users. It commits to simplifying State aid rules by June 2025 to accelerate the roll-out of renewable energy, deploy industrial decarbonisation and ensure sufficient capacity of clean tech manufacturing.

In relation to renewable gas, Q1 2025 will see a delegated act on low carbon hydrogen to clarify the rules for production with the aim of providing certainty for investors. There will be a third call under the Hydrogen Bank in Q3 2025 (with a budget of up to €1 billion) and Member States are encouraged to use the auctions-as-a-service platform. A Hydrogen Mechanism expected in Q2 2025 is intended to connect offtakers and suppliers, and link them with financing and de-risking instruments.

Further detail is in the Action Plan for Affordable Energy. Some actions, mostly for 2025, are as follows:

• achieving more efficient network charges: The Commission will propose tariff methodologies to incentivise flexibility and investment in electrification, and may propose legislation. It will provide guidance on use of public budgets (compliant with State aid) to lower network charges and to cover costs of accelerating decarbonisation, interconnection, major network upgrades, or offshore infrastructure, as well as anticipatory investments for grids.
• decoupling retail electricity bills from high and volatile gas prices: The Commission will launch, with the EIB, a pilot programme to counter-party part of PPAs. It will provide guidance on the design of effective CfDs and how they can be combined with PPAs. It will adopt rules to support further development of European forward markets and increase hedging opportunities.
• reducing permitting times for an accelerated energy transition: Member States are called on to implement existing measures. Commission actions will include legislative proposals to accelerate permitting for grids, storage and renewables, including streamlining environmental assessments and shortening deadlines for permits as part of a European Grid Package.
• accelerating the expansion, modernisation and digitalisation of grids: The Commission will propose a European Grid Package (including legislation) to simplify the TEN-E Regulation, ensure cross-border integrated planning and project delivery, streamline permitting, and enhance distribution grid planning. The EIB will introduce a ‘grids manufacturing package’ for the European supply chain to provide counter-guarantees to manufacturers of components.
• increasing system flexibility by deploying storage and demand response: Member States are called on to implement EU rules. The Commission will clarify the State aid requirements for non-fossil flexibility schemes. It will adopt new rules on demand response aimed at enabling consumers to take full financial advantage of flexibility. It will seek Member States’ views on a clean flexibility instrument based on PPAs.
• promoting flexibility in retail contracts: The Commission will develop guidance on remuneration of flexibility in retail contracts.
• harnessing EU purchasing power for natural gas: The Commission is to engage with LNG suppliers to identify additional cost-competitive imports. It will propose demand aggregation for EU companies entering into tolling contracts at LNG plants worldwide and LNG supply option contracts.
• an energy efficiency market of European dimension: Through the European Energy Efficiency Financing Coalition, the Commission intends to improve access to capital and provide financial incentives to support market actors who provide energy efficiency solutions for business. It will explore further cooperation with the EIB to support energy efficiency.
• completing the Energy Union: The Commission identifies several measures including development of a Clean Energy Investment Strategy, an updated Nuclear Illustrative Programme and a Fusion Strategy, an Electrification Action Plan, a Strategic Roadmap for Digitalisation and AI for the Energy Sector, and a Heating & Cooling Strategy.
• a tripartite contract for affordable energy: The intent is that governments, energy producers, and industry create a favourable investment climate for an affordable, sustainable energy system and competitive industrial sector. This would include sectoral contracts for sectors like hydrogen, synthetic fuels, batteries, offshore wind, solar, grids.
• energy security framework: The Commission will propose legislation to revise the current energy security framework.

The Commission will propose an Industrial Decarbonisation Accelerator Act to address permitting bottlenecks for industrial access to energy.  Other areas in the package include boosting supply and demand of decarbonised products; mobilising public and private finance; securing access to resources and strengthening a single market for waste, secondary raw materials, and reusable materials; building global partnerships; and supporting skills.