8 October 2024 – The competitiveness of European industry and its interdependent relationship with decarbonisation sits at the centre of the European Union’s policy agenda, as put forward by Commission President Von der Leyen’s political guidelines and the European Council Strategic Agenda 2024-2029. The fundamental relationship between competitiveness and decarbonisation pathways is also advocated by Mario Draghi’s report “The future of European competitiveness”.

ETS revenues are one of the major sources of funds at Member States’ disposal. To bridge the current investment gap, Draghi recommends earmarking ETS revenues towards industrial decarbonisation and incentivising more Member States’ allocations to manufacturing of clean technologies. The signatories of this letter welcome this recommendation, which needs to be done while maintaining the Green Deal objectives at the centre of the EU competitiveness efforts. While NZIA and its non-price criteria to be used in some renewable energy auctions are a ‘stick’ approach, mandating products with certain desirable characteristics from a supply chain, ETS revenues are a carrot – a source of money for – and one needs both approaches hand-in-hand.

EUREC, together with 15 civil society organisations, cleantech innovators, investors, industry associations, and researchers, urges EU Member States to allocate ETS revenues more efficiently to achieve climate goals and support clean industrial competitiveness. In this letter, the signatories present three sets of recommendations to ensure the effective use of EU ETS revenues by Member States and the EU Commission.

Read the letter in PDF below.