The European Commission announced on 26 February 2025 a broad set of measures aimed to support the industrial transition, ensure a more sustainable business environment and allow savings on the energy bill for both companies and citizens. Key legislative acts include the Clean Industrial Deal, the Action Plan of Affordable Energy, and the first two Omnibus packages providing simplification in sustainable finance reporting, due diligence, EU Taxonomy, carbon border adjustment mechanism, and European investment programmes. We resume the main features of the various policies proposed by the Commission; the evaluation of the Clean Industrial Deal by the European Parliament started on 17 March 2025.
The Clean Industrial Deal
The Commission Communication “The Clean Industrial Deal: A joint roadmap for competitiveness and decarbonisation” was published on 26 February 2025.
Built upon the indication of the Competitiveness Compass, the Clean Industrial Act addresses the challenges of climate change and the need to improve the EU’s economic resilience. Decarbonisation, reindustrialisation, and innovation are the three keywords inspiring the Act, which aims to be achieved rapidly and “all all at the same time and across the entire continent”.
The strategy depicted by the Clean Industrial Act targets energy-intensive industries and clean-tech sector, together with a more circular economy to reduce dependencies and enhance resilience. The Act identifies six business drivers that should work together to build a entirely new value chain: affordable energy, lead markets, financing, circularity and access to materials, global markets and international partnerships, and skills. Some of them are the object of the Omnibus packages.
Access to affordable energy
The availability of energy at low prices is fundamental to ensure the competitiveness of the European system, together with the availability of a suitable grid of infrastructures to integrate the different energy sources alternative to fossil fuels. In this instance, the Act also indicates the importance of AI-driven smart grids and IoT-based energy monitoring to ensure the optimal integration of energy systems, with the final goal to advance the EU “towards electrification and a fully integrated single market for energy”.
Specific measures to achieve it are the object of the Action Plan for Affordable Energy; according to the Commission, most of the announced measures should be delivered in 2025. The Action Plan for Affordable Energy is based on eight different lines of action, from issuing recommendations to member states on how to lower taxes on electricity. The uptake of long-term supply contracts is among the ways suggested to reduce supply costs, together with the exploration of the UE’s purchasing power for imported natural gas. New ecolabelling and ecodesign rules would aim to support better energy efficiency, and the completion of the Energy Union and fully integrated market. Tripartite contracts for affordable energy between the public sector, energy producers, and energy-consuming industries are also planned, as well as the guarantee of security of supply, even under a crisis preparedness scenario.
Increase the demand of decarbonised products
Another push towards decarbonisation should be represented by building business cases for decarbonised products, so as to act on the demand side of the supply chain. The creation of lead markets is the tool to pursue this objective and sustain the transition to clean technologies and products base on economies of scale and reduced costs.
Among the announced measures is the Industrial Carbon Management Strategy, focused on permanent carbon removal to compensate for residual emissions from hard-to-abate sectors. The Commission would also support the acceleration of development and deployment of small modular reactors. A delegated act on low-carbon hydrogen should be adopted in Q1 2025, followed by the third call under the Hydrogen Bank in Q3 2025 (up to 1 billion budget), and the launch of a Hydrogen Mechanism under the European Hydrogen Bank in Q2 2025.
The Industrial Decarbonisation Accelerator Act is expected to improve resilience in clean European supply for energy-intensive sectors. This new provision could proceed in parallel to the revision of Public procurement, scheduled in 2026, that should include targeted mandates and non-price criteria for sustainability and EU content requirements. The same criteria could also be used to incentivise private procurement, for example by introducing lifecycle-based CO2 emission performance standards. The Commission indicates that “there must be a clear link between incentives for decarbonisation and circularity efforts by the industry”, for example, by a “green premium” on product labelling. The proposal sees the development of a voluntary label on the carbon intensity of industrial products (i.e. steel, cement). Simplification and harmonisation of carbon accounting methodologies should also occur by Q4 2025.
Public and private investments
The ambitious goals of the Clean Industrial Deal require higher investments in energy, industrial innovation and scale up and transport systems, estimated at €480 billion/year more than the previous decade. Long-term regulatory stability, public incentives for decarbonisation and effective policy coordination are deemed key elements to leverage the market of private investments. This could be achieved by the proposed strategy on the Savings and Investment Union, coupled with the new Competitiveness Fund that should finance other projects with European added value.
The Innovation Fund should include new funding for selected projects that received a Sovereignty Seal under the STEP regulation. An Industrial Decarbonisation Bank with €100 billion in funding should further support the transition and clean tech development. The Commission should launch a pilot in 2025 supporting industrial decarbonisation and electrification. A Horizon Europe call of approx. €600 million under the 2026-2027 work program should focus on fit-for-deployment projects, also in the field of fusion energy.
An already presented amendment to the InvestEU regulation should increase its risk bearing capacity and re-use of surplus from the European Fund of Strategic Investments. European institutions should develop new initiatives specifically targeted to sectors impacted by the Clean Industrial Deal, in coordination with the European Investment Bank. A TechEU investment programme, for example, should be the tool to fill the gap for disruptive innovation and strengthening of industrial capacity, including in life sciences and neurotechnologies. A Clean Industrial Deal State Aid Framework would better support national intervention by simplification and flexibility of rules.
A new support hub dedicated to the Important Projects of Common European Interest (IPCEIs) should better support their rapid deployment. The Commission should also provide informal guidance to companies on the compatibility of cooperation projects contributing to the achievement of EU priorities with antitrust rules. Taxation would be adapted to better support clean businesses, such as shorter depreciation periods or tax credits in strategic sectors to support the transition.
How to develop a more circular economy
Circularity as a driver for innovation and more sustainable and secure supply chains should support the better availability of essential raw materials and secondary materials.
The Critical Raw Materials Act should include a first list of Strategic Projects to diversify supplies across the entire value chain. Among the announced measures are the creation of a platform for demand aggregation and matchmaking mechanism for strategic raw materials and a dedicated EU Critical Raw Material Centre for the joint purchase on behalf of interested companies. The Circular Economy Act, expected for 2026, should accelerate the single market for circular products, secondary raw materials and wastes, harmonising the “end of waste” criteria. It should also complement the Ecodesign for Sustainable Product Regulation, announced for April 2025. New Trans-Regional Circularity Hubs should help promote specialisation and economies of scale for recycling.
International partnerships and skills
Many fundamental raw materials still have to be acquired from extra-EU partners. In this instance, the Commission announced the intention to conclude and fully implement pending Free Trade Agreements and negotiate new ones. The new Clean Trade and Investment Partnerships (CTIPs) will represent a complementary tool to the agreements. Furthermore, among the Omnibus I package measures is also the simplification of the Carbon Border Adjustment Mechanism (CBAM) (see below).
The Clean Industrial Deal also provides a reference framework to support the development of high-level skills with the expertise needed to support the industrial transition and the re-qualification of workers.
The Omnibus packages on simplification
The Commission launched the first two Omnibus packages (Omnibus I and Omnibus II) in parallel to the Clean Industrial Deal, with the objective of reducing the administrative burden by at least 25% (at least 35% for SMEs) before the end of 2029. The proposals also aim to achieve a total saving in annual administrative costs of around €6.3 billion and mobilise additional investment capacity of €50 billion.
Many of the actions included in the packages are enablers of those announced in the Clean Industrial Deal; they must now undergo the scrutiny of the European Parliament and Council before the the final texts are adopted.
The proposal for a Directive amending the Corporate Sustainability Reporting Directive (CSRD) and the Directive on corporate sustainability due diligence (CSDDD) aims, among others, to better protect SMEs from the request of excessive sustainability information that can occur if they are part of the value chains of larger companies (or from financial institutions). Companies with up to a thousand employees and 50 million turnover will be out of the scope of the CSRD; larger companies will benefit from simplifying the existing sustainability reporting standards (ESRS).
The simplifications of rules on due diligence obligations should benefit about 6,000 EU and 900 non-EU companies (both large and SMEs) and their value chain partners. The reporting on Taxonomy may also become voluntary for larger companies after adopting a Delegated act amending the Taxonomy Disclosures and the Taxonomy Climate and Environmental Delegated Acts. Among planned interventions are an at least 70% reduction of data points, introduction of a materiality threshold to make not mandatory the disclosure of alignment for companies with less 10% eligible activities, the reduction of the scope for mandatory reporting on operational expenditure and simplification of certain “Do no significant harm” (DNSH) criteria.
The announced proposal to revise CBAM criteria would benefit importers of small quantities of CBAM goods, based on a new cumulative annual threshold expected to exempt approx 90% of importer from obligations.
The Omnibus II package specifically refers to the proposed amendment of the InvestEU regulation, which would introduce reduced reporting and administrative requirements for implementing partners, financial intermediaries, and final recipients. The planned actions are expected to allow companies to save around € 350 million and to make available €50 billion of extra resources in additional public and private investment.
The link provides a Q&As list that discusses in more details the contents of the Omnibus packages I and II.
