The EU aims to significantly boost renewable energy and bolster Europe’s clean energy supply chains. However, the Net-Zero Industry Act (NZIA) is lacking and needs enhancement. WindEurope CEO Giles Dickson warns in that Europe risks relying on non-European wind turbines if NZIA is not properly addressed.
Wind energy is pivotal for Europe’s energy goals. By 2030, the EU plans to increase wind energy’s share to 43% of Europe’s electricity, from 17% today. This translates to constructing 30 GW of wind farms annually.
Most of Europe’s wind farms use European-made turbines, supported by over 250 factories in the region. But supply chain bottlenecks are emerging. Key components, including power cables and steel towers, are being imported from China. The expansion of Europe’s wind energy demands significant investments in infrastructure and manpower.
The NZIA, central to the EU Green Deal Industrial Plan, requires modifications. The European Parliament and member states are currently revising it. It’s imperative to enhance the non-price criteria in renewables auctions to ensure social, economic, and environmental value. The current proposal must be more assertive on issues like supply chain resilience, cybersecurity, due diligence, and maintaining consistent application of non-price criteria.
Mistakes with NZIA could be costly. Chinese manufacturers, offering cheaper turbines and unique financial terms, are gaining ground in Europe. This not only threatens Europe’s energy independence but also jeopardizes economic contributions from the wind sector, which added €42bn to the EU GDP in 2022 and paid €7bn in local taxes.
In tandem with NZIA, the EU state aid rules support investments in clean energy manufacturing. The EU needs to provide funding, prioritize simplifying permitting rules, and expedite grid infrastructure development. Otherwise, the EU risks trading its dependence on Russian gas for reliance on Chinese renewable technology.
“Europe wants a green industrial policy. It wants renewables to be made in Europe. But it’s failing on the policies that will actually deliver that. The Net-Zero Industry Act needs beefing up. Public money has to support the expansion of green supply chains, as it does elsewhere in the world. Otherwise the EU Green Deal will be manufactured outside of Europe, and Europe will simply swap its dependency on Russian gas for one on Chinese clean energy equipment. Our existing green supply chains bring jobs, growth and investment to thousands of communities. We’ve got to wake up and preserve that AND build on it. NZIA is our chance. We mustn’t blow it”, stresses WindEurope CEO Giles Dickson.
