Open statement by energy intensive industries on the trilogues for the Fit for 55 package

ETS and CBAM trilogue: Last chance to make legislation fit for purpose to achieve industrial transformation, make the energy transition and ensure environmental integrity by enabling EU industries to remain competitive in global markets.

The Alliance of Energy Intensive Industries (AEII) brings together the sectors which provide direct employment to around 2.6 million people and make products which are the foundations of critical and strategic value chains for the EU economy and society. We support the objectives of the European Green Deal. Companies in our sectors are investing in concrete projects across a range of technological pathways to deliver deep emission reductions and are switching to alternative energy sources and feedstocks. Yet all these new technologies come with significant additional costs and industries will have to substantially increase their investments to implement them. This represents a tremendous challenge which should not be underestimated but also a unique opportunity to get on track for climate neutrality.

As the trilogues on the Fit for 55 package are starting, the AEII wants to share recommendations for the revision of the Emission Trading Directive (ETS) and the introduction of a Carbon Border Adjustment Mechanism (CBAM).

These negotiations take place in a turbulent geopolitical context. The European Energy Intensive Industries need urgent support to face the energy crisis which will have long-lasting consequences. In the last months, the European industries have experienced uncertainties in energy supply, sky-rocketing energy prices, high inflation, and very high direct and indirect carbon costs (at levels which are largely above the price expected by 2030 in the ETS Impact Assessment from the EC) and raw materials shortages. This crisis results in significant production curtailments and business closures and will cause further disruptions in the near future and for years to come. European products are being replaced by imports of often more carbon-intensive products leading to a significant increase in global emissions. High electricity prices are also a major barrier to direct and indirect electrification as one of the key solutions for transforming the EU industry toward the climate neutrality target. These developments will jeopardise the UN’s climate goals and will increase European import dependency on raw materials and goods.

The trilogues should propose measures that tackle climate change globally by preventing carbon leakage and giving our industries predictability and stability; this is essential to attract investments in decarbonisation and to proceed and succeed with the energy transition, ensuring that EU manufacturing companies would stay in operation and tackle climate change. Measures against carbon leakage are essential until competitors outside the EU face the same conditions and obligations across global markets.

We would also like to stress the importance of ensuring full coherence between the different pieces of legislation in the Fit For 55 package. It is key to carefully analyse the impact of the current crisis, the inconsistencies between the different legal requirements of the energy and climate-related regulations and develop appropriate measures that support effective solutions for emissions in hard-to-abate sectors.

Against this background, we urge EU institutions to focus on the following elements in view of the upcoming trilogues. Read the Open Statement here.

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