(1)

The net-zero transformation is already causing huge industrial, economic, and geopolitical shifts across the globe, which will become ever more pronounced as the world advances in its decarbonisation efforts. The Union needs to respond to those developments while implementing the energy, climate and environmental transitions. A strong manufacturing base is a key element in securing access to net-zero technologies and maintaining quality jobs in the Union. That requires that the Union preserve its competitiveness, including through innovation, in particular with regard to clean technologies.

(2)

Given the complexity and the transnational character of net-zero technologies, uncoordinated national measures to ensure access to those technologies risk distorting competition and fragmenting the internal market. Such measures by Member States can result in imposing diverging regulation on market operators, in providing different levels of access to the supply of net-zero technologies across Member States, including by providing different levels of support for net-zero technology manufacturing projects, and in providing for diverging rules and uncoordinated forms of procurement, diverging processes and durations in relation to permit-granting processes thus creating obstacles to the cross-border trade between Member States and hindering the proper functioning of the internal market. To safeguard the functioning of the internal market it is therefore necessary to create a common Union legal framework to collectively address that central challenge by increasing the Union’s resilience and security of supply in the field of net-zero technologies.

(3)

The Union has committed to the accelerated decarbonisation of its economy and the ambitious deployment of renewable energy sources, in order to achieve climate neutrality, namely net-zero emissions or emissions after the deduction of removals, by 2050. That objective is at the heart of the European Green Deal, which is set out in the Commission communication of 11 December 2019, entitled ‘The European Green Deal’, the Commission communication of 5 May 2021, entitled ‘Updating the 2020 New Industrial Strategy: Building a stronger Single Market for Europe’s recovery, and is in line with the Union’s commitment to global climate action under the Paris Agreement (4). In order to reach the Union’s climate neutrality goal, Regulation (EU) 2021/1119 of the European Parliament and of the Council (5) sets a binding Union climate target to reduce net greenhouse gas emissions by at least 55 % by 2030 compared to 1990. The proposed “Fit for 55” package, set out in the Commission communication of 14 July 2021, entitled “Fit for 55”: delivering the EU’s 2030 Climate Target on the way to climate neutrality’ aims to deliver on the Union’s 2030 climate target and revises and updates Union law in that respect.

(4)

Moreover, the Green Deal Industrial Plan set out in the Commission communication of 1 February 2023 sets out a comprehensive approach to support a clean energy technology scale-up on the basis of four pillars. The first pillar aims to create a regulatory environment that simplifies and streamlines permit- granting processes for new net-zero technology manufacturing and assembly sites, and to facilitate the scaling up of the Union’s net-zero industry. The second pillar aims to boost investment in and financing of net-zero technology production by means of the revised Temporary Crisis and Transition Framework for State Aid measures to support the economy following the aggression against Ukraine by Russia established in the Commission communication of 17 March 2023 and the creation of the Strategic Technologies for Europe Platform (STEP) established by Regulation (EU) 2024/795 of the European Parliament and of the Council (6), to preserve the Union’s edge on critical and emerging technologies relevant to the green and digital transitions. The third pillar relates to developing the skills needed to make the transition happen and to increase the number of skilled workers in the clean energy technology sector. The fourth pillar focuses on trade and the diversification of the supply chain of critical raw materials. That includes creating a critical raw materials club, working with like-minded partners to collectively strengthen supply chains and diversifying from single suppliers for critical input. This Regulation forms part of those measures and contributes to enhancing the business case for industrial decarbonisation in the Union.

(5)

The internal market provides the appropriate environment for enabling access at the necessary scale and pace to the technologies required to achieve the Union’s climate and energy ambitions as well as the objective of the European Green Deal to turn decarbonisation into sustainable competitiveness. The road towards a climate neutral, resource-efficient and net-zero economy creates strong opportunities for the expansion of the Union’s net-zero industry, making use of the strength of the internal market, by promoting investment in net-zero technologies and their supply chains. Those technologies are necessary for achieving the objectives of the Member States’ integrated national energy and climate plans pursuant to Regulation (EU) 2018/1999 of the European Parliament and of the Council (7), contribute to the resilience and competitiveness of Union industry and enable the decarbonisation of economic sectors, from energy supply to transport, buildings, and industry in the Union. A strong net-zero industry within the Union can help significantly in reaching the Union’s climate and energy targets effectively, as well as in supporting other European Green Deal objectives, while fostering an industrial base and therefore creating quality jobs and sustainable growth.

(6)

To fulfil those commitments, the Union must accelerate its pace of transition to a net-zero economy, including by increasing the share of clean energy in its energy mix, as well as by increasing energy efficiency and the share of renewable energy sources. That will contribute to achieving the Union targets set out in the European Pillar of Social Rights Action Plan for 2030, which is the Commission’s contribution to the implementation of the European Pillar of Social Rights proclaimed in Gothenburg in 2017 (the ‘Pillar’).

(7)

The higher energy prices following Russia’s unjustified and unlawful military aggression against Ukraine led to a strong impetus to accelerate the implementation of the European Green Deal and reinforce the resilience of the Energy Union governed by Regulation (EU) 2018/1999, by speeding up the clean energy transition and ending any dependence on fossil fuels exported from Russia. The REPowerEU plan, set out in the Commission communication of 18 May 2022, entitled ‘REPowerEU Plan’, plays a key role in responding to the hardships and global energy market disruption caused by Russia’s invasion of Ukraine. That plan aims to accelerate the energy transition in the Union, in order to reduce the Union’s gas and electricity consumption and to boost investments in the deployment of energy efficient and low carbon solutions.

(8)

To meet the Union’s climate and energy targets, energy efficiency needs to be prioritised. Saving energy is the cheapest, safest and cleanest way to meet those targets. ‘Energy efficiency first’ is an overall principle of the Union’s energy policy and is important in both its practical applications in policy and investment decisions. Therefore, it is essential to expand the Union’s manufacturing capacity for energy efficient technologies, such as heat pumps, district heating and cooling, and smart grid technologies that help the Union to reduce and control its energy consumption.

(9)

The Union’s decarbonisation objectives, security of energy supply, digitalisation of the energy system and electrification of demand, for example with regard to mobility and the need for additional and faster recharging points, require an enormous expansion of electricity grids in the Union, both at transmission level and at distribution level. At transmission level, high-voltage direct current systems are needed, inter alia, to connect offshore renewable energies, while at distribution level, connecting electricity providers and managing demand-side flexibility builds on investments in innovative grid technologies, such as electric vehicles smart charging, energy efficiency building and industry automation and smart controls, advanced meter infrastructure and home energy management systems. The electricity grid needs to interact with many actors or devices on the basis of a detailed level of observability, and hence availability of data, to enable flexibility, smart charging, smart buildings with smart electricity grids and small-scale flexibility services enabling demand-side response from consumers and the uptake of renewables. Connecting the net-zero technologies to the network of the Union requires the substantial expansion of manufacturing capabilities for electricity grids in areas such as offshore and onshore cables, substations and transformers.

(10)

Additional policy effort is therefore necessary for the Union to have a strong potential for a rapid scale-up of manufacturing capacity to support the Union’s 2030 climate target by improving market conditions for those technologies that are commercially available, as well as the security of supply for net-zero technologies and their supply chains, reducing market fragmentation, and safeguarding or strengthening the overall resilience and competitiveness of the Union’s energy system. It includes access to a safe and sustainable source of best-in-class fuels, as referred to in Commission Delegated Regulation (EU) 2022/1214 (8).

(11)

This Regulation should complement Regulation (EU) 2024/1252 of the European Parliament and of the Council (9) by focusing on the manufacturing of net-zero technologies in terms of final products, specific components, and specific machinery that is primarily used to produce them. Regulation (EU) 2024/1252 focuses instead on the upstream part of the supply chain, particularly critical raw materials, and their extraction, processing and recycling. Those technologies are indispensable for a wide set of strategic sectors including net-zero technology industries, the digital industry and the aerospace and defence sectors. By following the same logic of nurturing a business case, upgrading, and providing adequate skills, and supporting investments, this Regulation and Regulation (EU) 2024/1252 complement each other to create regulatory support synergies across the entire supply chain of net-zero technology manufacturing in the Union. This Regulation also covers processed materials that are an essential component of net-zero technologies, with the exception of critical raw materials falling under Regulation (EU) 2024/1252.

(12)

Final products and specific components which are essential for the production of net-zero technologies should be listed in an annex in a non-exhaustive manner. These include final products and their components that are manufactured and traded by a company, including processed materials, but excluding raw materials covered by Regulation (EU) 2024/1252. The aim of that annex is to identify, to the extent possible, final products and specific components that are essential for the production of net-zero technologies and that can therefore reasonably be considered always to be primarily used for all net-zero technologies listed in this Regulation. Specific components and specific machinery not covered in that annex may still fall under the scope of this Regulation where, on the basis of evidence provided to a national competent authority, the project promoter can prove, for example via market studies or off-take agreements, that the specific components or specific machinery are primarily used for the production of net-zero technologies, with the exception of critical raw materials falling under the scope of Regulation (EU) 2024/1252.

(13)

Certain specific components in the supply chain of net-zero technologies are produced through energy-intensive production processes namely in the steel, aluminium, non-ferrous metals, basic chemicals, cement, lime, glass, ceramics, fertilisers, as well as pulp and paper sectors. Many of those processes are characterised by a high energy and carbon intensity, making their CO2 emissions usually hard to abate. At the same time, Regulation (EU) 2021/1119 requires rapid decarbonisation of the Union’s economy. In light of the fact that energy-intensive industries accounted for 17 % of overall greenhouse gas emissions in the Union in 2019, their decarbonisation is indispensable to reach climate neutrality in the Union. That means that the security of supply in the Union of specific components used for net-zero technologies also depends on intensifying decarbonisation efforts in energy-intensive industries. Energy-intensive industry facilities fall under the scope of this Regulation where the relevant facilities produce specific components that are primarily used in net-zero technologies. Due to the need to decarbonise those sectors as a whole and in order to ensure the availability of specific components produced by them that are used in the net-zero technology supply chains, unlike other net-zero technology manufacturing projects to which this Regulation applies, this Regulation should also apply to projects of energy-intensive industries that produce specific components that are used, but not exclusively so in the supply chains of net-zero technologies. The inclusion of such hard-to-abate facilities in the scope of this Regulation should be conditional on a project comprising the construction or conversion of such a facility leading to a significant reduction of CO2 emissions stemming from the production activities. Supporting those sectors in a targeted manner under this Regulation contributes to ensuring access to a sustainable supply of net-zero technologies in the internal market, increases investment certainty and creates a demand-side pull for net-zero transformative and decarbonisation technologies.

(14)

The list of net-zero technologies sets out the technologies which are essential for the decarbonisation objectives of the Union and improving the functioning of the internal market. The list includes technologies that not all Member States accept as a source of clean and secure energy. That is in line with their right to determine their choice between different energy sources and the general structure of their energy supply as well as their industrial policy. To safeguard those rights, the list of net-zero technologies is without prejudice to the funding allocation under the current Multiannual Financial Framework 2021 to 27, in particular in terms of allocation eligibility and award criteria related to energy technologies in Union funds, including those financed through Emissions Trading System (ETS) allowances or support by the European Investment Bank (EIB). A Member State should also not be obliged to recognise as strategic projects that support a supply chain for a technology that it does not accept as part of its energy mix.

(15)

In order to ensure that the Union’s future energy system is resilient, this scaling-up should be carried out across the whole supply chain of the technologies in question, in full consistency and complementarity with Regulations (EU) 2024/1252 and (EU) 2023/1781 (10) of the European Parliament and of the Council.

(16)

In order to address security of supply issues while contributing to supporting the resilience of the Union’s energy system and decarbonisation and modernisation efforts, the net-zero technology manufacturing capacity in the Union needs to expand. The Union needs to ensure that the regulatory environment for manufacturers of photovoltaic (PV) technologies enables them to increase their competitive edge and improve security of supply perspectives, by aiming to reach at least 30 gigawatt of operational PV manufacturing capacity by 2030 across the full PV value chain, in line with the goals set out in the European Solar Photovoltaic Industry Alliance, which is supported under the Union’s Solar Energy Strategy established by the Commission communication of 18 May 2022. The Union needs to ensure that the regulatory environment for manufacturers of wind and heat pump technologies enables them to consolidate their competitive edge and maintain or expand their current market shares throughout the 2020s, in line with the Union’s technology deployment projections that meet its 2030 energy and climate targets. This translates into a Union manufacturing capacity for wind of at least 36 GW and for heat pumps of at least 31 GW by 2030. Union manufacturers of batteries and electrolysers need to find a regulatory environment that enables them to consolidate their technology leadership and actively contribute to shaping those markets. For battery technologies, that would mean contributing to the objectives of the European Battery Alliance and aim to meet almost 90 % of the Union’s battery annual demand by the Union’s battery manufacturers, meaning a Union manufacturing capacity of at least 550 GWh by 2030. For Union electrolyser manufacturers, the REPowerEU plan projects 10 million tonnes of domestic renewable hydrogen production and up to 10 million tonnes of renewable hydrogen imports by 2030. To ensure that the Union’s technological leadership translates into commercial leadership, as supported under the Electrolyser Joint Declaration of the Commission and the European Clean Hydrogen Alliance, Union electrolyser manufacturers should be enabled to further boost their capacity, so that the overall installed electrolyser capacity being deployed reaches at least 100 GW hydrogen by 2030. The RePowerEU plan also sets an objective of boosting sustainable biomethane production to 35 billion cubic meter by 2030. With its supply chain largely based in Europe today, biomethane already makes a contribution to the Union’s resilience and should be further promoted. Union manufacturers of aviation and maritime fuels need to further develop, produce and scale up sustainable alternative fuels in order to significantly contribute to the reduction of the transport sector’s greenhouse gas emissions by 90 % in 2050, as well as to meet the obligations laid down in Regulation (EU) 2023/2405 of the European Parliament and of the Council (11) and Regulation (EU) 2023/1805 of the European Parliament and of the Council (12). That reduction is also strongly supported by the Renewable and Low-Carbon Fuels Value Chain Industrial Alliance. The Union needs to ensure that the regulatory environment and support framework for producers of sustainable aviation and maritime alternative fuels technologies enables them to increase their production capacities across the full fuels value chain, from the collection and supply of feedstock to blending, including conversion and refining capacities.

(17)

Considering those objectives together, while also taking into account that for certain elements of the supply chain, such as inverters, as well as solar cells, wafers, and ingots for PV or cathodes and anodes for batteries, the Union manufacturing capacity is low. In order to help tackle import dependency and vulnerability concerns and to ensure that the Union’s climate and energy targets are met, an overall benchmark for the manufacturing capacity for net-zero technology products in the Union should be set, while striving towards a similar benchmark for net-zero technologies. The Union net-zero technologies annual capacity should aim to approach or reach an overall annual manufacturing benchmark of at least 40 % of annual deployment needs by 2030 for net-zero technologies considered as a whole.

(18)

At the same time, net-zero technology products will contribute to the Union’s resilience and security of supply of clean energy. A secure supply of clean energy is a prerequisite for economic development, as well as for public order and security. Net-zero technology products will also yield benefits to other strategically important economic sectors, such as farming and food production, by securing access to clean energy and machinery at competitive prices, thus contributing sustainably to the Union’s food security and to providing an increasing outlet for bio-based alternatives through the circular economy. In the same way, the fulfilment of the Union’s climate ambitions will lead to both economic growth and social well-being.

(19)

The global market for key mass manufactured clean energy technologies will be worth around USD 650 billion a year by 2030, which is more than three times the current level. Globally, the net-zero industry is growing at an increasing rate. The Union industry can deliver prosperity for Union citizens only if it is competitive on and open to the global market. A Union net-zero technology sector that is competitive globally will provide support for the development of a strong Union manufacturing capacity of net-zero technologies. Furthermore, Union industries that are globally competitive in segments of the net-zero technology supply chains will contribute to the overall resilience of the Union’s net-zero technology supply chains, and enhance the Union’s access to net-zero technologies.

(20)

The manufacturing of net-zero technologies depends on complex and globally interlinked value chains. In order to maintain competitiveness and reduce current strategic import dependencies in net-zero technology products and their supply chains, while avoiding the formation of new ones, the Union needs to continue strengthening its net-zero industrial base and become more competitive and open to innovation. Together with other measures to enhance the Union’s competitiveness, measures to increase the manufacturing capacity in the Union should also ensure that the Union play a dominant role in strategic parts of the global value chain, including final products, to ensure the level of security of supply that the Union needs for the purpose of achieving its climate and energy objectives. Therefore, a second overall benchmark should be established. The Union’s manufacturing capacity for net-zero technologies should aim to reach an increased share of world production, with a view to reaching 15 % of world production in value by 2040, on the basis of the monitoring as provided for in this Regulation. That second benchmark should not apply where the increased Union’s manufacturing capacity would be significantly higher than the Union’s deployment needs for the corresponding technologies necessary to achieve the Union’s climate and energy targets.

(21)

In order for net-zero technology manufacturing projects, including net-zero strategic projects, to be deployed or expanded as quickly as possible to ensure the Union’s security of supply for net-zero technologies, it is important to ensure efficiency in planning and investment certainty by keeping the administrative burden on project promoters to a minimum. For that reason, permit-granting processes of the Member States for net-zero technology manufacturing projects, including net-zero strategic projects, should be streamlined, while ensuring that such projects are safe, secure, environmentally sustainable, and comply with environmental, social and safety requirements. Union environmental law sets common conditions for the process and content of national permit-granting processes, thereby ensuring a high level of environmental protection. Being granted the status of net-zero strategic project should be without prejudice to any applicable permitting conditions for the relevant projects, including those set out in Directives 2000/60/EC (13), 2004/35/EC (14), 2010/75/EU (15), 2011/92/EU (16) and 2012/18/EU (17) of the European Parliament and of the Council and Council Directive 92/43/EEC (18).

(22)

Member States should be able, in light of their internal organisation, to choose whether to establish or designate their single points of contact at local, regional or national level, or at any other relevant administrative level. Moreover, the relevant competent authorities should specify and make available to the single point of contact the requirements and extent of information requested by a project promoter before the permit-granting process commences. The single point of contact should be responsible for communicating that information to the project promoter. The single point of contact should, in its role of coordinator, facilitate the provision of information to the competent authorities, in particular to avoid duplication of any permit-granting process requests. Such requests could include studies, permits or authorisations.

(23)

In order to reduce complexity and increase efficiency and transparency in the permit-granting process, net-zero manufacturing projects, including strategic project promoters should be able to interact with a single point contact which is responsible for facilitating and coordinating the entire permit- granting process. To that end, Member States should establish or designate one or more single points of contact, while ensuring that project promoters have to interact with a sole point of contact. It should be for Member States to decide whether a single point of contact is also an authority that makes permitting decisions. To ensure the effective implementation of their responsibilities, Member States should provide their single points of contact, as well as any authority involved in the permit-granting process with sufficient personnel and resources.

(24)

In order to allow businesses and project promoters, including for cross-border projects, to directly enjoy the benefits of the internal market without incurring an unnecessary additional administrative burden, Regulation (EU) 2018/1724 of the European Parliament and of the Council (19), which established the Single Digital Gateway, provides for general rules for the online provision of information, procedures and assistance services relevant for the functioning of the internal market. The information that needs to be submitted to any relevant authorities via the single point of contact concerned as part of the permit-granting process under this Regulation are covered in Annex I to Regulation (EU) 2018/1724, and the related procedures are included in Annex II to that Regulation to ensure that project promoters can benefit from fully online procedures and the Once-Only Technical System Services. Single points of contact established or designated pursuant to this Regulation are included in the list of assistance and problem-solving services in Annex III to Regulation (EU) 2018/1724.

(25)

Net-zero technology manufacturing projects undergo lengthy and complex permit-granting processes which can last between two and seven years, depending on the Member State technology and value chain segment. Considering the size of the required investments, in particular for gigafactory-size projects which are needed to reach the expected economies of scale, inadequate permit-granting processes create an additional and often detrimental barrier to increasing net-zero technology manufacturing capacity in the Union. In order to provide project promoters and other investors with the security and clarity needed to increase development of net-zero technology manufacturing projects, Member States should ensure that the permit-granting process related to such projects does not exceed pre-set time limits. For net-zero strategic projects, the length of the permit-granting process should not exceed 12 months for facilities with a yearly production output of 1 GW or more, nine months for those with a yearly production output of less than 1 GW, or 18 months for all necessary permits to operate a strategic CO2 storage site and the deployment of related CO2 capture and CO2 transport projects. For net-zero technology manufacturing projects, the length of the permit-granting process should not exceed 18 months for facilities with a yearly production output of 1 GW or more, and 12 months for those with a yearly production output of less than 1 GW. For net-zero technologies for which the GW metric is not relevant, such as grids and carbon capture and storage (CCS) or CO2 transport and utilisation technologies, the upper limits of the those deadlines should apply. However, the first step of the environmental impact assessment pursuant to Directive 2011/92/EU, which consists of the preparation of an environmental impact assessment report, is often predominantly performed by the project promoter. That step should therefore not be integrated in the timelines which the Member States are bound by as referred to in the permit-granting process. To that end, the single point of contact should notify the date by which the project promoter needs to submit the environmental impact assessment report, and any period between that notified date and the actual submission of the report should not be counted towards the timeline. The same principle should apply where, after the required consultations, the single point of contact notifies the project promoter of the opportunity to submit additional information to complete the environmental impact assessment report. In exceptional cases related to the nature, complexity, location or size of the proposed project, Member States should be able to extend the timelines. Such exceptional cases could include unforeseen circumstances triggering the need to add to or complete environmental assessments related to the project, or delays due to expropriation processes where required.

(26)

It is possible for some specific net-zero manufacturing projects to be recognised as net-zero strategic projects. They bring additional benefits, in particular with regard to the reduction of the Union dependencies or the achievement of the Energy Union and climate goals. Net-zero manufacturing projects can contribute to strengthening the technological and industrial resilience of the Union by increasing manufacturing capacity for a key segment of a supply chain. In particular, adding manufacturing capacity for sectors for which the Union’s manufacturing capacity represents a significant share of world production, and which play a crucial role in the resilience of the Union, makes it possible to strengthen the Union’s position in the global net-zero manufacturing supply chain and helps tackle import vulnerability concerns. Furthermore, those projects can bring additional benefits in terms of skills development and competitiveness as well as support the Union decarbonisation goals through implementing circular and sustainable manufacturing practices. In light of any such additional benefits, those projects should be selected as strategic projects by the Member States and should benefit from a framework allowing their speedier implementation, in particular through priority status and shorter time limits in the permit-granting process. Project promoters that wish to receive the status of a net-zero strategic project need to formally apply for such a status to the relevant Member State in accordance with the application and recognition criteria laid down in this Regulation.

(27)

The environmental assessments and authorisations required under Union law, including in relation to water, soil, air, ecosystems, habitats, biodiversity and birds, are an integral part of the permitgranting process for a net-zero technology manufacturing project and an essential safeguard to ensure negative environmental impacts are prevented or minimised. However, to ensure that permit-granting processes for net-zero technology manufacturing projects are predictable and timely, any potential to streamline the required assessments and authorisations should be realised, while not lowering the level of environmental protection. In that regard, the necessary assessments should be bundled to prevent unnecessary overlap and project promoters and the relevant authorities should explicitly agree on the scope of the bundled assessment before the assessment is carried out to prevent unnecessary follow-up.

(28)

Land use conflicts can create barriers to the deployment of net-zero technology manufacturing projects. Well-designed plans, including spatial plans and zoning, should consider whether to introduce possible net-zero technology manufacturing projects, while taking into account the results of public consultations and potential environmental impacts. Those plans have the potential to help balance the public interest and common good, decreasing the potential for conflict and accelerating the sustainable deployment of net-zero technology manufacturing projects in the Union. The relevant national, regional and local authorities should therefore be encouraged to include, where appropriate, provisions for net-zero technology manufacturing projects, including net- zero strategic projects, when developing plans.

(29)

Clustering industrial activity directed towards industrial symbiosis can minimise the environmental impact of the activities and provide efficiency gains for industrial actors involved. Clustering can contribute substantially to achieving the objectives of this Regulation. In that regard, this Regulation promotes the development of net-zero Acceleration Valleys (the ‘Valleys’). The objectives of Valleys are to create clusters of net-zero industrial activity in order to increase the attractiveness of the Union as a location for manufacturing activities and to further streamline the administrative procedures for setting up net-zero manufacturing capacities. Valleys should be limited in geographical and technology scope in order to promote industrial symbiosis. When defining the scope, Member States should take into account the need to favour multiple uses of the areas identified to ensure the expansion, reindustrialisation or creation of the Union’s net-zero technology industrial clusters and the availability of relevant transport and network infrastructure, storage and other flexibility tools. Setting up Valleys should correspond to any planned or existing project pipeline and the potential to access or organise education and training opportunities to ensure the availability of skilled labour. Valleys should be designated by Member States and each designation should be accompanied by a plan setting out concrete national measures to increase the attractiveness of the Valley as a location for manufacturing activities. Valleys should, in particular, be used as a tool for strengthening net-zero industrial activities in regions, taking into account the just transition and its objectives, in particular in coal regions in transition.

(30)

Member States should be able to designate and support the Valleys. When designating a Valley, Member States should draw up a plan specifying which net-zero manufacturing activity is to be covered in the Valley (the ‘Plan’). Member States should also conduct environmental impact assessments as required for the net-zero manufacturing activities that are to take place in the Valley. Such impact assessments substantially limit the need for undertakings to perform those assessments for permits for the net-zero manufacturing activities within the scope of the Valley. The Plan should include the results of the environmental impact assessments as well as the national measures to be taken to minimise or mitigate any negative environmental impact. The Plan should also include concrete national measures to support industrial activity within the scope of the Valley. Those measures should include measures to invest in or trigger private investment in energy, digital and transport infrastructure, as well as measures to reduce the operational expenditure for the industry in the Valley, such as contracts of difference for energy prices. Other measures to be considered include those strengthening intellectual property protection, to set up an innovation hub in the Valley and to attract start-ups to the Valley. In order to provide investment security for Union industry, the Plan should also specify the duration of the support measures.

(31)

Member States are encouraged to designate Valleys in less developed and transition regions, as well as in assisted areas. Investments with the aim of setting up Valleys, equipping them with appropriate infrastructure, converting brownfield sites and developing local skills, can benefit from public financial support, including through shared managed funds, namely European Regional Development Fund and Cohesion Fund established by Regulation (EU) 2021/1058 of the European Parliament and of the Council (20), the Just Transition Fund established by Regulation (EU) 2021/1056 of the European Parliament and of the Council (21), and the European Social Fund Plus (ESF+) established by Regulation (EU) 2021/1057 of the European Parliament and of the Council (22). In accordance with the rules governing each fund and at the discretion of the relevant managing authorities, those investments can receive the highest possible co-financing rates permitted by each fund.

(32)

Given the role of Valleys in aggregating and pooling of resources that are relevant for the Union’s open strategic autonomy, and their contribution to the Union’s security of supply for net-zero technologies, as well as the green and digital transition, the relevant permitting authorities should consider Valleys to be in the public interest. That measure consists of the introduction of a provision specifying that projects in Valleys are of public interest for the purposes of the relevant Union environmental law. Those projects should not have major adverse effects on the environment which cannot be mitigated or compensated for. On the basis of an ex-ante assessment, the relevant permitting authority can conclude that the public interest served by the projects in a Valley overrides the public interests related to nature and environmental protection and that, consequently, the projects can be authorised, provided that all relevant conditions set out in Directive 2000/60/EC, Directive 2009/147/EC of the European Parliament and of the Council (23), Directive 92/43/EEC and Union legislative acts on nature restoration are met.

(33)

The unpredictability, complexity and, at times, excessive length of national permit-granting processes undermines the investment security necessary for the effective development of net-zero technology manufacturing projects, including net-zero strategic projects. Therefore, in order to ensure and speed up effective implementation, Member States should apply streamlined and efficient permit-granting processes. Furthermore, Member States should consider policy innovation in that field. Moreover, net-zero strategic projects should be regarded as urgent at national level and should therefore be given a priority status insofar as and to the extent that national law provides for such urgency procedures in all judicial and dispute resolution procedures relating to them, while ensuring respect for the rights of defence, if and to the extent, national law provides for such urgency procedures. This should be done without preventing competent authorities from streamlining permit-granting processes for, inter alia, other net-zero technology manufacturing projects that are not net-zero strategic projects.

(34)

In order to achieve the 2030 objectives, a particular focus is needed on net-zero strategic projects, also in view of their significant contribution towards the path to net- zero CO2 emissions by 2050. Those projects play a key role in the Union’s open strategic autonomy, ensuring that citizens have access to clean, affordable, secure energy. Given their role, those projects should benefit from even more streamlined and efficient permitting procedures, obtain the status of the highest national significance possible under national law and benefit from additional support to crowd-in investments, while still meeting Union and international obligations pursuant to Directives 2009/147/EC, 92/43/EEC, Union legislative acts on nature restoration and the United Nations Economic Commission for Europe Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters, signed at Aarhus on 25 June 1998, as well as applicable obligations in the fields of social and labour law established by Union or national law.

(35)

Given their role in ensuring the Union’s security of supply for net-zero technologies, and their contribution to the Union’s open strategic autonomy and the green and digital transition, the relevant permitting authority should consider net-zero strategic projects to be in the public interest. On the basis of its case-by-case assessment, a permitting authority can conclude that the public interest served by the project overrides the public interests related to nature and environmental protection and that consequently the project can be authorised, provided that all relevant conditions set out in Directive 2000/60/EC, 2009/147/EC or 92/43/EEC, or in Union legislative acts on nature restoration, are met.

(36)

It is also necessary to provide for measures to reach the Union’s target of 50 million tonnes of annual operational CO2 injection capacity by 2030, thereby supporting the decarbonisation of the Union’s industries and combating climate change.

(37)

In 2020, the Commission adopted an EU strategy for energy system integration. That strategy sets out a vision on how to accelerate the transition towards a more integrated energy system that supports a climate neutral economy at the lowest cost across sectors. It encompasses three complementary and mutually reinforcing concepts: first, a more ‘circular’ energy system, with energy efficiency at its core; second, a greater direct electrification of end-use sectors; third, the use of renewable and low-carbon fuels, including hydrogen. Considerations related to energy system integration refer to solutions for fully integrating all the electricity generated by renewable energy installations into the wider energy system. That includes adopting technical solutions that allow for the integration of surplus electricity generated by renewable electricity installations, including through storage and by expanding plannable fossil free power sources in the grid, in its various forms and demand-side management.

(38)

CCS is a technology that will contribute to mitigating climate change. It consists of the capture of CO2 from industrial installations, its transport to a storage site and its injection into a suitable underground geological formation for the purposes of permanent storage.

(39)

The development of CCS solutions for industry is confronted with a coordination failure. On the one hand, despite the fact that the CO2 price signal provided by the ETS makes such investments economically viable, industries investing in capturing CO2 emissions face a significant risk of not being able to access a permitted geological storage site. On the other hand, investors in first CO2 storage sites face upfront costs to identify, develop and appraise them even before they can apply for a regulatory storage permit. Transparency about potential CO2 storage capacity in terms of the geological suitability of relevant areas and all existing geological data, including raw and model data, in particular from the exploration of hydrocarbon production sites, can support market operators to plan their investments. Member States should, while taking into account confidentiality, national security and commercial sensitivities, as well as adequate compensation for privately generated and owned data, make such existing data publicly available and report regularly from a forward-looking perspective about any progress in developing CO2 storage sites and the corresponding needs for injection and storage capacities, in order to collectively reach the Union-wide target for CO2 injection capacity. Those transparency obligations are without prejudice to the right of Member States not to authorise or to limit the deployment of CO2 storage capacity on their territory.

(40)

To avoid stranded assets and to ensure that economically viable injection capacity leads to CO2 reductions, a business case along the full value chain should be built. Therefore, full and individual CCS value chains including capture, transport and storage need to be established by 2030 via effective Union and national policies with appropriate regulations guaranteeing competition and open access.

(41)

A key bottleneck for carbon capture investments that are today increasingly economically viable is the availability of operating CO2 storage sites in the Union, which underpin the incentives derived from Directive 2003/87/EC of the European Parliament and the Council (24). To scale up the technology and expand its leading manufacturing capacities, the Union needs to develop a forward-looking supply of permanent geological CO2 storage sites permitted in accordance with Directive 2009/31/EC of the European Parliament and of the Council (25) as well as CO2 transport infrastructures. By defining a Union target of 50 million tonnes of annual operational CO2 injection capacity by 2030, in line with the expected capacities needed by 2030, and taking into account the companies operating primarily in Member States with very limited storage capacity due to legal, geological, geographical, technical or market constraints, the relevant sectors can coordinate their investments towards a European net-zero CO2 transport and storage value chain that industries can use to decarbonise their operations. This initial deployment will also support further CO2 storage in a 2050 perspective. According to the Commission’s estimates, the Union could need to capture up to 550 million tonnes of CO2 annually by 2050 to meet the net-zero objective, including for carbon removals. Such a first industrial-scale storage capacity objective will de-risk investments in the capturing of CO2 emissions as an important tool to reach climate neutrality. When this Regulation is incorporated into the European Economic Area Agreement, the Union target of 50 million tonnes of annual operational CO2 injection capacity by 2030 will be adjusted accordingly. To ensure the achievement of the Union’s target, Member States should take the necessary measures to facilitate and incentivise the deployment of CCS projects. Such measures should also include measures incentivising emitters to capture emissions and investment support for investors for CO2 transport infrastructures to transport CO2 to the storage sites.

(42)

Any international agreement relating to the permanent storage of Union CO2 in third countries should provide for equivalent conditions to ensure permanently secure and environmentally safe geological storage of captured CO2 and ensure that the storage of Union CO2 is not used to increase hydrocarbon production and corresponds to a genuine reduction of emissions.

(43)

By defining CO2 storage sites and any related CO2 capture and CO2 infrastructure projects that contribute to the Union’s 2030 target as net-zero strategic projects, the development of CO2 storage sites can be accelerated and facilitated, and the increasing industrial demand for storage sites can be channelled towards the most-cost-effective storage sites. An increasing volume of depleting gas and oil fields that could be converted into safe CO2 storage sites are at the end of their useful production lifetime. In addition, the oil and gas industry has affirmed its determination to embark on an energy transition and possesses the assets, skills and knowledge needed to explore and develop additional storage sites. To reach the Union’s target of 50 million tonnes of annual operational CO2 injection capacity by 2030, the sector needs to pool its contributions to ensure that CCS as a climate solution is available ahead of demand. In order to ensure a timely, Union-wide and cost-effective development of CO2 storage sites in line with the Union objective for injection capacity, licensees of oil and gas production in the Union should contribute to that target on a pro rata basis of their oil and gas manufacturing capacity, while providing flexibilities to cooperate and take into account other contributions of third parties. A value-chain approach should be fostered by actions taken both at Union and national level. Accordingly, licensees of oil and gas production in the Union should undertake the necessary investments and support the development of viable business models for the entire carbon dioxide value chain.

(44)

In order to contribute to the Union CO2 injection capacity objective, obligated entities are able to enter into agreements with non-obligated entities to fulfil the entirety or a part of their obligation. Those agreements can be a part of a joint-venture agreement that establishes a storage site or be conducted separately between parties to fulfil the contribution of the obligated entity. Where such joint-ventures have been established before the date of entry into force of this Regulation, the full injection capacity of the relevant joint CO2 storage project can be used to fulfil the obligations of the obligated partners parties.

(45)

In order to ensure that storage sites are developed under sound market conditions, the Commission should carry out an assessment that looks into the relationship between the concrete demand for injection capacity from CO2 capture projects and the main infrastructure necessary for the transport of CO2 in progress or planned to be operational by 2030 and the 2030 storage capacity obligations.

(46)

Derogations from the obligation are an essential tool to prevent stranded assets under these circumstances. To apply these derogations effectively, Member States and the Commission should fully engage with the relevant authorised entities in any assessment of the need for a derogation, particularly in the case where an authorised entity flags the need for a derogation. For the purpose of achieving the Union’s CO2 injection capacity objective, where, on the basis of the Commission’s assessment, no derogation is granted, or where the relevant Member State did not request a derogation, the Commission and the Member State will engage with relevant authorised entities to help resolving obstacles and barriers so as to facilitate the achievement of the obligation.

(47)

Additional policy effort is essential to secure the deployment of cross-border infrastructure planning. Accessibility and connectivity of the full range of arrangements for the transport of CO2 play a critical role for the deployment of CCS and carbon capture and utilisation projects. Such arrangements cover ships, barges, trains and trucks as well as fixed facilities for connecting and docking, for liquefaction, buffer storage and converters of CO2 in view of its further transport through pipelines and in dedicated modes of transport.

(48)

It should be possible for Member States to form, or to provide support for the formation of, entities that have the objective of creating CO2 transport networks including the construction of infrastructure or the provision of vessels or other means of conveyance.

(49)

The capture, storage and utilisation of CO2 will inevitably be part of the Union’s decarbonised future including removals. A well-functioning Union-wide market for captured CO2, CO2 injection services, CO2 transport services and carbon utilisation activities is necessary. This market should deliver on certain public policy objectives in the most economically advantageous manner. An overall objective is the sustainable and cost-effective decarbonisation of Union industry by ensuring that any CO2 emissions which cannot be reduced through technical means, or where it is not economically viable to reduce those emissions, can be captured and either stored or utilised, avoiding delayed emissions. That market should also ensure the safety, sustainability and permanence of the geological storage of captured CO2 and that captured CO2 is available for carbon utilisation activities in line with the Union’s climate objectives. A functioning market for CO2 should also be underpinned by a network of CO2 transport infrastructure with a minimal environmental footprint which is accessible for market actors under fair, open and non-discriminatory conditions. The market should comply with Union environmental standards.

(50)

Using captured CO2 in certain production processes can permanently store CO2 or contribute to reducing the Union’s dependence on fossil fuels. Therefore, all entities involved in the value chain of CO2 injection activities set out in this Regulation should be encouraged to consider whether the CO2 that is to be stored could be permanently stored in new products or could support the Union's objectives to reduce its reliance on fossil fuels.

(51)

The Union has helped build a global economic system on the basis of open, transparent and rules-based trade, has pushed for respecting and advancing social and environmental sustainability and climate transition standards, and is fully committed to those values. The Union aims to level the playing field by reforming the World Trade Organization (WTO), building new partnerships and fighting against unfair trading practices and production overcapacity, to secure a fair competitive environment for Union industry, including through Net-Zero Industrial Partnerships, providing quality jobs for workers.

(52)

In order to ensure the Union’s access to a secure and sustainable supply of net-zero technologies necessary to safeguard the Union’s resilience and in order to reach its climate neutrality targets, the internal market needs to be a supportive environment for innovation in net-zero technologies to take place. Innovation will be a crucial factor in ensuring the Union’s competitiveness as well as reaching net-zero objectives as soon as possible. Given the rapid developments in net-zero technologies as well as the significant regulatory guidance provided for the green transition, it is of utmost importance, in order to achieve the objectives of this Regulation, that the potential impacts of Union law and policy initiatives on innovation are considered during their preparation, review and revision through the application of the innovation principle.

(53)

In order to reflect the objectives of this Regulation, the Commission could consider whether to update the Transition Pathways that are being developed following the Commission communication of May 2021 and that could identify enablers as well as bottlenecks for the transition and competitiveness of Union industry, or take this Regulation into account in any such future initiatives.

(54)

Under the first pillar of the Green Deal Industrial Plan, the Union is to develop and maintain an industrial basis for the provision of net-zero technology solutions to secure its energy supply, while also living up to its ambitions on climate neutrality. To support that goal and to avoid dependencies for the supply of net-zero technologies that would delay the Union’s greenhouse gas emission reductions efforts or put the security of supply of energy at risk, this Regulation should lay down provisions to encourage demand for sustainable and resilient net-zero technologies.

(55)

The application of minimum mandatory requirements ensures that the leverage of public spending to boost demand for better performing procurement for net-zero products in the field of environmental sustainability is increased in a structured way that is implementable for contracting authorities and contracting entities. Some exceptions should ensure that contracting authorities and contracting entities avoid specific undesirable consequences. Those exceptions relate to monopoly situations, specific market failures or situations where contracting authorities or contracting entities might be faced with disproportionate costs or technical incompatibilities. Contracting authorities and contracting entities should remain free to include additional minimum requirements in their procurement documents, provided that they comply with Directives 2014/23/EU (26), 2014/24/EU (27) or 2014/25/EU (28) of the European Parliament and of the Council and applicable sectoral law. They should also remain free, under the same conditions, to use, in addition, award criteria for identifying the most economically advantageous tender such as price, cost or other criteria.

(56)

For works contracts and works concessions that fall within the scope of this Regulation, contracting authorities and contracting entities should choose one or more specific conditions, requirements or contractual obligations to help achieve several objectives, such as addressing social or employment-related considerations in order to achieve a positive social outcome, effectively taking into account cybersecurity concerns, where relevant, or obtaining sufficient assurance that the relevant products will be delivered in a timely manner. Those aspects are also important to foster resilience. Exceptions relating to monopoly situations, specific market failures or situations where contracting authorities or contracting entities might be faced with disproportionate costs or technical incompatibilities should also be provided for.

(57)

In some cases attention should be given to the tender’s resilience contribution in relation to certain third countries. If the Commission has determined that the proportion of a net-zero technology or its main specific components originating in a third country accounts for more than 50 % of the supply of that specific technology or of those components within the Union, contracting authorities and contracting entities should be obliged to include several conditions in their procurement documents in order to achieve a resilient outcome. In that way, the value of the specific net-zero technology or the main specific components of the specific net-zero technology originating from the third country concerned should not exceed a 50 % limit under specific conditions. Moreover, if the Commission has determined that the proportion of supply within the Union of those products or components originating in a third country has increased by at least 10 percentage points on average for two consecutive years and has reached at least 40 % of the supply within the Union, the same mechanism should apply. This will allow the Union to take into account evolving dependencies in an efficient manner. For contracts covered by the Union’s Appendix I to the World Trade Organisation Agreement on Government Procurement (GPA) or by other relevant international agreements by which the Union is bound, contracting authorities and contracting entities should not apply those requirements to net-zero technologies or their main specific components originating from sources of supply that are signatories to those agreements.

(58)

In the event of non-observance of those resilience requirements, contracting authorities and contracting entities should also require, in their procurement documents, the main contractor to be obliged to pay a proportionate charge to the contracting authority or contracting entity concerned of at least 10 % of the value of the specific net-zero technologies of the contract, in order to ensure that the mechanism is complied with.

(59)

Member States should not discriminate against, or subject to unjustified different treatment, a provider of net-zero technologies from another Member State. That obligation mirrors the already existing obligation for contracting authorities and contracting entities, in accordance with Directives 2014/23/EU, 2014/24/EU and 2014/25/EU, to treat economic operators equally and without discrimination and to follow the procedural rules laid down in those Directives to ensure that the principles of equal treatment and non-discrimination are given practical effect and public procurement procedures are opened up to competition.

(60)

Without prejudice to Union law applicable to a specific technology, including under Regulation (EU) 2024/1781 of the European Parliament and of the Council (29) and Regulation (EU) 2023/1542 of the European Parliament and of the Council (30), and unless otherwise provided for therein, when evaluating the environmental sustainability of the net-zero solutions procured on the basis of this Regulation, contracting authorities and contracting entities should be able to take into account various elements with an impact on the climate and the environment.

(61)

Implementing powers should be conferred on the Commission to establish guiding principles for contracting authorities and contracting entities to specify technical specifications, requirements, and contract performance conditions related to environmental sustainability for public contracts. This should be without prejudice to Union law applicable to specific technologies, including under Regulation (EU) 2024/1781 and Regulation (EU) 2023/1542.

(62)

In order to take into account, within a public procurement procedure or an auction, of the need to support the production or consumption of energy from renewable sources and the need to diversify sources of supply of net-zero technologies away from single sources of supply, and without prejudice to the Union’s international commitments, the supply should be deemed to be insufficiently diversified at least where the specific net-zero technology or its main specific components originates from a single third country and accounts for more than 50 % of that supply within the Union.

(63)

In order to promote the responsible business conduct of bidders, the cybersecurity and data security of the technologies used, projects and related infrastructures and to promote the delivery of projects fully and on time, public authorities designing auctions for the deployment of energy from renewable sources should include pre-qualification criteria related to responsible business conduct, cybersecurity and data security and the ability to deliver the project fully and on time.

(64)

To support the aim of developing and maintaining an industrial basis for the provision of renewable energy technologies to secure the Union’s energy supply and to avoid dependencies for the supply of these technologies that would delay the Union’s greenhouse gas emission reductions efforts or put the security of energy supply at risk, public authorities designing auctions for the deployment of energy from renewable sources should increase the sustainability and resilience of the supply of those technologies within the Union. Member States should assess the auctions’ contribution to sustainability by examining the environmental sustainability of bids, their contribution to innovation and their contribution to energy system integration. For that purpose, Member States should have the choice to introduce pre-qualification or award criteria in the auction design. While pre-qualification criteria should be fulfilled by all the bidders’ projects in order to be able to participate in the auction, award criteria are aimed to evaluate and rank the different projects participating in an auction.

(65)

When considering the environmental sustainability of bids, either in the form of pre-qualification criteria or award criteria, public authorities designing auctions for the deployment of energy from renewable sources may take into account various elements with an impact on the climate and the environment. Those elements could include, the durability and reliability of the solution; the ease of repair and maintenance and access to such services; the ease of upgrading and refurbishment; the ease and quality of recycling; the use of substances; the consumption of energy, water and other resources in one or more life cycle stages of the product; the weight and volume of the product and its packaging; the incorporation of renewable materials, recycled or used components; the quantity, characteristics and availability of consumables necessary for proper use and maintenance; the environmental footprint of the product and its life cycle environmental impacts; the carbon footprint of the product; the microplastic release; emissions to air, water or soil released in one or more life cycle stages of the product; the amounts of waste generated; and the conditions for use.

(66)

To support the design and production of more innovative and advanced renewable energy technologies, the sustainability contribution of bids may take into account, either in the form of pre-qualification criteria or award criteria, the contribution to innovation by providing for pre-qualification or award criteria that promote the use of entirely new solutions or the improvement of comparable state-of-the-art solutions.

(67)

To support the integration of energy from renewable sources into the Union’s energy system and its benefits for cost-effective decarbonisation, the sustainability contribution of bids may take into account the contribution to energy system integration through, for instance, energy storage, waste heat and cold recovery and the production of renewable hydrogen.

(68)

To increase the resilience of supply of net-zero renewable energy technologies and to avoid excessive dependency on countries with a high concentration of supply within the Union, public authorities should consider, by means of pre-qualification or award criteria, the resilience contribution of the different projects participating in auctions for the deployment of energy from renewable sources, taking into account the need to diversify the supply of renewable energy technologies, without prejudice to the Union’s international commitments. When applying the resilience criterion, public authorities should take into account that the supply should at least be deemed insufficiently diversified where more than 50 % of the demand within the Union for a specific net-zero technology or for its main specific components originates from a single third country.

(69)

When applied as award criteria, the weighting of criteria on the sustainability and resilience contribution of the tender in relation to auctions for the deployment of energy from renewable sources is without prejudice to the possibility for the authorities designing those auctions to set a higher threshold for the criteria relating to environmental sustainability, innovation and energy system integration where that is compatible with any limit for non-price criteria set under State aid rules. In any event, the application of these criteria and their minimum and combined weight in auctions should ensure that auctions remain competitive and comply with Articles 107 and 108 of the Treaty on the Functioning of the European Union (TFEU).

(70)

In order to increase the Union’s supply of renewable energy technologies to reach the overall annual manufacturing benchmark needs by 2030 within the Union, a specific share of the volume auctioned for which non-price criteria are applied should be provided for in this Regulation. This share should be assessed every two years by the Commission in order to determine the impact of the non-price criteria on the development of the Union’s annual manufacturing of renewable energy technologies and the deployment of energy from renewable sources, including their financial impact and their impact on the speed of deployment, while also taking into account the workability and clarity of the system for project developers. If the assessments show that the application of the resilience and sustainability criteria positively contributes to the security of supply of the Union for net-zero technologies, in particular by increasing the manufacturing capacity in the Union for renewable energy technologies, and do not significantly hinder the achievement of the targets for renewable energy set out in Directive (EU) 2018/2001 of the European Parliament and of the Council (31), including the deployment in each Member State, the application of those provisions should be step-wise increased. Each step should be subject to an impact assessment to ensure that higher shares continue to contribute positively to the security of supply of renewable energy technologies and that those benefits outweigh the effects on the cost and speed of deployment of energy from renewable sources. The determination of the share of the volume auctioned should, if appropriate and feasible, strive to reach a gradual overall increase with a view to contributing to meeting the overall objectives of this Regulation and to reaching 50 % by the end of 2029.

(71)

Depending on their goals for the deployment of energy from renewable sources and their national decarbonisation strategies, Member States could be impacted very differently by the application of the resilience and sustainability criteria. When assessing the impact of those criteria on the deployment of energy from renewable sources, the Commission should therefore examine the overall financial impact and the effects on deployment in the Union as well as the impact on Member States and other relevant stakeholders, including households and companies. To determine the impact on the deployment of energy from renewable sources and take into account practical experiences with applying non-price criteria, the Commission should consult, as part of its assessment and in a structured and transparent manner, the national authorities carrying out auctions.

(72)

The criteria for auctions might add an excessive burden for promoters of renewable energy projects with small capacity. To limit the impact of this Regulation on auctions to support projects with a maximum capacity of 10 megawatt, Member States should be able to exclude those auctions from the calculation of the total volume of capacity auctioned per year.

(73)

Where auctions to which pre-qualification, resilience and sustainability criteria are applied are undersubscribed, the deployment of energy from renewable sources should not be slowed down by obliging Member States to apply those criteria to the undersubscribed share of the auction’s volume. Member States should, therefore, be able to exclude from the requirements for auctions the share of the auction’s volume that is undersubscribed. An auction is considered to be undersubscribed when the bids presented for that auction cover a volume that is below the total volume of the capacity auctioned.

(74)

For the purpose of setting up schemes benefiting households, businesses, or consumers which incentivise the purchase of net-zero technology final products, and without prejudice to the Union’s international commitments, the supply should be deemed insufficiently diversified where a single source supplies more than 50 % of the total demand for a specific net-zero technology within the Union. To ensure consistent application, the Commission should publish an annual list, starting on the date of application of this Regulation, of the distribution of the origin of net-zero technology final products which fall under this category, broken down by the share of Union supply originating in different sources in the most recent year for which data are available.

(75)

Council Decision 2014/115/EU (32) approved, inter alia, the amendment of the GPA. The aim of the GPA is to establish a multilateral framework of balanced rights and obligations relating to public contracts with a view to achieving the liberalisation and expansion of world trade. For contracts covered by the Union’s Appendix I to the GPA, as well as by other relevant international agreements by which the Union is bound, including free trade agreements and Article III:8(a) of the General Agreement on Tariffs and Trade of 1994 for procurement by governmental agencies of products purchased with a view to commercial resale or with a view to use in the production of goods for commercial sale, contracting authorities and contracting entities should not apply resilience requirements to net-zero technologies or their main specific components originating from sources of supply that are signatories to those agreements.

(76)

The application of the provisions on resilience in public procurement procedures pursuant to this Regulation should be without prejudice to Article 25 of Directive 2014/24/EU and Articles 43 and 85 of Directive 2014/25/EU, and in line with the Commission communication of 24 July 2019 entitled ‘Guidance on the participation of third country bidders and goods in the EU procurement market’. Similarly, public procurement provisions should continue to apply to works, supplies and services subject to this Regulation, including Article 67(4) of Directive 2014/24/EU and any implementing measures resulting from Regulation (EU) 2024/1781.

(77)

In order to limit the administrative burden resulting from the need to take into account requirements relating to the sustainability and resilience contribution of the tender, in particular for smaller public buyers and for contracts of lower value which do not have an important impact on the market, the application of the relevant provisions of this Regulation should be deferred for two years for public buyers which are not central purchasing bodies and for contracts of a value below EUR 25 million.

(78)

For the purposes of the application of the provisions relating to public procurement pursuant to this Regulation, where a product is covered by a delegated act adopted pursuant to Regulation (EU) 2017/1369 of the European Parliament and of the Council (33), contracting authorities and contracting entities should purchase only the products that comply with the obligation laid down in Article 7(2) of that Regulation.

(79)

Households, businesses, and final consumers are an essential part of the Union’s demand for net-zero technologies final products and public support schemes to incentivise the purchase of such product by households, in particular for vulnerable low- and lower middle-class income households and consumers, are important tools to accelerate the green transition. Under the solar rooftop initiative announced in the Commission communication of 18 May 2022, Member States should for instance set-up national programmes to support the massive deployment of rooftop solar energy. In the REPowerEU plan, the Commission called Member States to make full use of supporting measures which encourage switching to heat pumps. Such support schemes set up nationally by Member States or locally by local or regional authorities should also contribute to improving the sustainability and resilience of the Union’s net-zero technologies. Public authorities should for instance provide higher financial compensation to beneficiaries for the purchase of net-zero technology final products that will make a higher contribution to resilience in the Union. Public authorities can make the eligibility of schemes conditional on the sustainability and resilience contribution. In doing so, Member States are encouraged to take into account the accessibility of the scheme for citizens living in energy poverty. Public authorities should ensure that their schemes are open, transparent and non-discriminatory, so that they contribute to increase demand for net-zero technology products in the Union. Public authorities should also limit the additional financial compensation for such products so as not to slow down the deployment of net-zero technologies in the Union. To increase the efficiency of such schemes, Member States should ensure that information is easily accessible both for consumers and for net-zero technology manufacturers on a free website. The use by public authorities of the sustainability and resilience contribution in schemes targeted at consumers or households should be without prejudice to State aid rules and to WTO rules on subsidies.

(80)

When designing schemes benefiting households, businesses, or consumers which incentivise the purchase of net-zero technology final products, Member States, regional or local authorities, bodies governed by public law or associations formed by one or more such authorities or one or more such bodies governed by public law, should ensure respect for the Union’s international commitments, including by ensuring that such schemes do not reach a magnitude that causes serious prejudice to the interest of WTO members.

(81)

The Commission should also be able to assist Member States in the design of schemes targeted at households, businesses, and consumers to build synergies and exchange best practices. The Net-Zero Europe Platform (the ‘Platform’) should also play an important role in accelerating the implementation of the sustainability and resilience contribution by Member States and public authorities in their practices relating to public procurement procedures and auctioning. The Commission should, after consulting the Platform, adopt an implementing act specifying the criteria to assess the sustainability and resilience contribution. That act should give particular attention to small and medium-sized enterprises (SMEs), which should have a fair chance to participate in the substantial market for public procurement. It should also ensure that the requirements with regard to sustainability and resilience are applied in a way that ensures fair and equal competition among market players regardless of their ownership structure.

(82)

In order to ensure that public procurement procedures and auctions for the purpose of deploying renewable energy sources truly contribute to the Union's resilience, those activities need to be predictable for industry. To enable the industry to adjust its production on time, contracting authorities and contracting entities should inform the market in advance of their estimated procurement needs for net-zero technology products.

(83)

In addition to measures oriented towards public and household demand, the Union could consider action to ease the deployment of net-zero technologies in the Union’s industrial value chains with particular attention to SMEs, in particular through facilitating the connection between supply and demand from industry.

(84)

As indicated in the Communication on the Green Deal Industrial Plan, the Union industry’s market shares are under strong pressure due to subsidies in third countries which undermine a level playing field. That situation poses a competitive challenge for the Union to maintain and develop its own industry and creates a need for a rapid and ambitious reaction from the Union in modernising its legal framework.

(85)

Considering the Union’s goal to reduce strategic dependencies on third countries for net-zero technologies, it is crucial that public support mechanisms, such as public procurement procedures and auctions, do not exacerbate such dependency. Therefore, where necessary and appropriate, justified limitations should be set on the proportion of products in supply contracts sourced from third countries if the Commission has determined that the conditions linked to resilience laid down in this Regulation are fulfilled. Furthermore, efforts should be undertaken to effectively tackle unfair subsidies from third countries that undermine the level playing field, for example by using all possible measures provided for in Regulations (EU) 2022/1031 (34) and (EU) 2022/2560 (35) of the European Parliament and of the Council.

(86)

Access to public and private finance is key for ensuring the Union’s open strategic autonomy and for establishing a solid and competitive manufacturing base for net-zero technologies and their supply chains across the Union. The majority of investments necessary to reach the European Green Deal objectives will come from private capital, attracted by both the growth potential of the net-zero ecosystem and a stable and ambitious policy framework. Well-functioning, deep and integrated capital markets will therefore be essential to raise and channel the funds necessary for the green transition and net-zero technology manufacturing projects. Swift progress towards the Capital Markets Union is thus necessary for the Union to deliver on its net-zero objectives. The sustainable finance agenda (and blended finance) also plays a crucial role in scaling up investments into the net-zero technologies along the value chains, while guaranteeing the competitiveness of the sector. As indicated in the Staff Working Document accompanying this Regulation, investment needs amount to around EUR 92 billion over the period 2023 to 2030, with a range of between about EUR 52 to 119 billion depending on various scenarios, which would result in public funding requirements of EUR 16 to 18 billion. Considering that this assessment only takes into account six specific technologies, the real investment need is likely to be significantly higher.

(87)

Private investment by companies and financial investors is essential. Where private investment alone is not sufficient, the effective roll-out of net-zero technology manufacturing projects might require public support, for example in the form of guarantees, loans or equity and quasi-equity investments, while avoiding distortion within the internal market. When that public support comes in the form of State aid, such aid should have an incentive effect and be necessary, targeted, temporary, appropriate and proportionate, while preserving competition and cohesion in the internal market. The existing State aid guidelines that have recently undergone an in-depth revision in line with the twin transition objectives, provide ample possibilities to support investments for projects within the scope of this Regulation subject to certain conditions. Member States can have an important role in easing access to finance for net-zero technology manufacturing projects by addressing market failures through targeted and temporary State aid support. The Temporary Crisis and Transition Framework adopted on 9 March 2023 aims to ensure a level playing field within the internal market that is targeted to those sectors where a third-country delocalisation risk has been identified and that is proportionate in terms of aid amounts. It enables Member States to put in place measures to support new investments in production facilities in defined, net-zero sectors, including via tax benefits. The permitted aid amount can be modulated with higher aid intensities and aid amount ceilings if the investment is located in assisted areas, in order to contribute to the goal of convergence between Member States and regions. In order to avoid fragmentation of the internal market, appropriate conditions are required to verify the concrete risks of diversion of the investment outside the EEA and that there is no risk of relocation within the EEA. To mobilise national resources for that purpose, Member States are encouraged to spend, in accordance with Article 10(3) of Directive 2003/87/EC, 25 % of ETS revenues that Member States collect annually from ETS auctions.

(88)

Any additional mobilisation of State aid should be targeted, temporary and consistent with Union policy objectives such as the European Green Deal and the Pillar. Such financing should not lead to additional disparities among Member States, in line with the Union’s competition and cohesion policies.

(89)

Public support should be used to address specific identified market failures or sub-optimal investment situations in a proportionate manner, and actions should not duplicate or crowd out private financing or distort competition in the internal market. Actions should have a clear added value for the Union. Public investment can, in particular, focus on the necessary infrastructure investments, on fostering innovation and on the upscaling of breakthrough technologies.

(90)

Several Union funding programmes, such as the Recovery and Resilience Facility established by Regulation (EU) 2021/241 of the European Parliament and of the Council (36), InvestEU established by Regulation (EU) 2021/523 of the European Parliament and of the Council (37), cohesion policy programmes or the Innovation Fund established pursuant to Directive 2003/87/EC of the European Parliament and of the Council (38), are also available to fund investments in net-zero technology manufacturing projects. Moreover, STEP will help to better channel existing Union funds towards critical investments aiming to support the development or manufacturing of critical technologies, including clean technologies.

(91)

Regulation (EU) 2023/435 (39) makes available an additional EUR 20 billion of non-repayable support to Member States in order to promote energy efficiency and replace fossil fuels through, inter alia, the Union’s net-zero industry projects. As pointed out in the Commission Guidance on the REPowerEU chapters, Member States are encouraged to include in the REPowerEU chapter of their recovery and resilience plans measures which support investments in net-zero technologies manufacturing and industrial innovation, in accordance with Regulation (EU) 2021/241 of the European Parliament and of the Council (40).

(92)

InvestEU is the Union flagship programme to boost investment, especially the green and digital transition, by providing financing and technical assistance, for instance through blending mechanisms. Such an approach contributes to crowd in additional public and private capital. Moreover, Member States are encouraged to contribute to the InvestEU Member State compartment to support financial products available to net-zero technology manufacturing, without prejudice to applicable State aid rules.

(93)

Member States can provide support from cohesion policy programmes, in accordance with Regulation (EU) 2021/1060 of the European Parliament and of the Council (41), to encourage the take up of net-zero strategic projects as well as net-zero technology manufacturing projects in all regions, especially in less developed regions transition regions and Just Transition Funds territories, through investment packages of infrastructure, productive investment in innovation, manufacturing capacity in SMEs, services, training and upskilling measure, including support for capacity building of the public authorities and promoters. The Technical Support Instrument established by Regulation (EU) 2021/240 of the European Parliament and of the Council (42) can help Member States and regions in preparing net-zero growth strategies, improving the business environment, reducing red tape and accelerating permitting processes. Member States should be encouraged to promote the sustainability of net-zero projects by embedding these investments in the Union’s value chains, building in particular on interregional and cross border cooperation networks. The adoption of such measures should be considered in particular with regard to Valleys.

(94)

The Innovation Fund also provides for a very promising and cost efficient avenue to support the scaling up of manufacturing and deployment of clean hydrogen and other net-zero technologies in the Union, thus reinforcing the Union’s sovereignty in key technologies for climate action and energy security.

(95)

To overcome the limitations of the current fragmented public and private investments efforts and to facilitate integration and return on investment, the Commission and Member States should better coordinate and create synergies between the existing funding programmes at Union and national level, as well as ensure better coordination and collaboration with industry and key private sector stakeholders. The Platform has a key role to play in building a comprehensive view of available and relevant funding opportunities and in discussing the individual financing needs of net-zero strategic projects. With a view to incentivising the production of net-zero technologies in the Union, the Platform may discuss how to address funding, the regulatory framework as well as investment and location guarantees.

(96)

Moreover, given the importance of net-zero technology manufacturing projects and net-zero strategic projects for the Union’s energy supply, certain administrative restrictions should be partly lifted or simplified to speed up the implementation of such projects.

(97)

Space data and services derived from the Union Space Programme established in Regulation (EU) 2021/696 of the European Parliament and of the Council (43), in particular Copernicus, shall be used to the extent possible to provide information on the geology, biology, ecology, socio-economic development, and resource availability for the environmental assessments and authorisations. Such data and services, in particular the Copernicus anthropogenic CO2 emission monitoring and verification capacity, are relevant to the assessment of the impact of industry projects and the impact of anthropogenic CO2 sinks on the global greenhouse gas concentrations and fluxes.

(98)

The Commission should, as provided for in Article 10(1) of Regulation (EU) No 1025/2012 of the European Parliament and of the Council (44), request one or more European standardization organisation to draft European standards in support of the objectives of this Regulation.

(99)

Hydrogen Valleys with industrial end-use applications play an important role in decarbonising the energy-intensive industries. REPowerEU sets the objective of doubling the number of Hydrogen Valleys in the Union. In order to achieve this objective, Member States should accelerate permitting and should consider establishing net-zero regulatory sandboxes and prioritise access to funding. To strengthen net-zero resilience, Member States should ensure the interconnection of Hydrogen Valleys across the Union’s borders. Industrial installations which produce their own energy, and which can provide a positive contribution to the production of electricity, should be encouraged to contribute to the smart electricity grid as energy producers by simplifying regulatory requirements.

(100)

Net-zero regulatory sandboxes can be an important tool to promote innovation in the field of net-zero technologies and regulatory learning. Innovation needs to be enabled through experimentation spaces as scientific outcomes need to be tested in a controlled real-word environment. Net-zero regulatory sandboxes should be introduced to test innovative net-zero technologies or other innovative technologies with the potential to enable the transition to a climate neutral and clean economy and to reduce strategic dependencies, in a controlled real-world environment for a limited amount of time, thus enhancing regulatory learning and potential scaling up and wider deployment. It is appropriate to strike a balance between legal certainty for participants in the net-zero regulatory sandboxes and the achievement of the objectives of Union law. Member States should be able to provide for derogations of net-zero regulatory sandboxes in national law while ensuring compliance with Union law and with the essential requirements on net-zero technology laid down in national law. The Commission published a Guidance for Sandboxes document in 2023 as announced in the New European Innovation Agenda to support Member States in preparing the net-zero regulatory sandboxes. Those innovative technologies could eventually be essential to achieve the Union’s climate neutrality objective and to ensure the security of supply and resilience of the Union’s energy system.

(101)

The Union’s Strategic Energy Technology Plan (SET Plan) revised in the Commission communication of 20 October 2023, supports the development of clean, efficient and cost-competitive energy technologies through coordination and collaboration in clean energy research and innovation, bringing together European industry, research organisations and government representatives from the SET Plan countries (45). The revision of the SET Plan aims to align the original SET Plan strategic objectives with the European Green Deal, REPowerEU and the Green Deal Industrial Plan, in particular this Regulation. It aims to promote a unified approach towards achieving Europe’s decarbonisation goals, supporting European net-zero technologies, and building a sustainable and resilient energy future. The SET Plan has had a structuring effect on joint Research and Innovation (R&I) actions, helping them deliver on common energy research and technology objectives with greater speed and effectiveness. The SET Plan has contributed to aligning the R&I efforts and to leverage national public funding of participating countries to support jointly agreed R&I priorities through the Clean Energy Transition Partnership and the Driving Urban Transition Partnership under Horizon Europe, established by Regulation (EU) 2021/695 of the European Parliament and of the Council (46), as an example of successful the Union’s cross-sectoral cooperation. The SET Plan plays a central role in implementing the research, innovation and competitiveness dimension of the Energy Union of the national energy and climate plans. However, since its beginning in 2007, the SET Plan was an unofficial forum. This Regulation provides momentum to strengthen the bridge between European innovation and the manufacturing of new innovative technologies.

(102)

Additional skilled workers are required in order to enable the green and digital transitions and the sustainable growth and competitiveness of the Union, the scaling up of Union’s net-zero technology industries’ supply chains and maintaining quality jobs in the Union. That implies important investment needs in re-skilling and upskilling, including in the field of vocational education and training.. The energy transition will require a significant increase in the number of skilled workers in a range of sectors, including renewable energy and energy storage and raw materials, and has a great potential for quality job creation. The skill needs for the fuel cell hydrogen sub-sector in manufacturing alone are estimated at 180 000 trained workers, technicians and engineers by the year 2030, according to the SET Plan. In the photo-voltaic solar energy sector, up to 66 000 jobs would be needed in manufacturing alone. It is therefore of utmost importance to make jobs in net-zero technologies attractive and accessible and to tackle the current mismatch between the skills of workers and the needs of companies.

(103)

Since strengthening the manufacturing capacity of key net-zero technologies in the Union will not be possible without a sizeable skilled workforce, it is necessary to introduce measures to boost the integration and activation of more people in the labour market, in particular women, young people not in employment, education or training (NEETs), people with a migrant background, older persons and persons with disabilities Moreover, this should include workers from third countries as the Union attracts only a small share of qualified migrants. In line with the objectives of the Council Recommendation on ensuring a fair transition towards climate-neutrality, specific support for job-to-job transition for workers in redundant and declining sectors are important. This means investing in skills for all, while having a targeted approach towards vulnerable groups and regions in transition. The end objective should be the creation of quality jobs in the Union required for net-zero technologies in line with the targets for employment and training provided for in the Pillar, including fair and adequate wages, improving living and working conditions and ensuring safe and healthy workplaces as well as the right to quality life-long learning. Skills and labour shortages might also be the result of unattractive jobs and poor working conditions. Improving job quality in sectors and companies with poor working conditions is therefore an important element to attract workers. Building on and fully taking into account existing initiatives such as the EU Pact for Skills, activities at Union level with regard to skills intelligence and forecasting, such as those by the European Centre for the Development of Vocational Training (Cedefop) and the European Labour Authority, and the Blueprints for sectoral cooperation on skills, the objective is to mobilise all actors to ensure relevance and increase the uptake of the training programmes, including Member States’ authorities, including at regional and local level, education and training providers, social partners and industry, in particular SMEs, as well as all types of universities, in order to identify skills needs, develop education and training programmes and deploy them at large scale in a fast and operational manner. Net-zero strategic projects have a key role to play in this regard. Member States and the Commission should ensure relevant financial support including by leveraging the possibilities of the Union budget through instruments such as the ESF +, InvestEU, Just Transition Fund, Horizon Europe, European Regional Development Funds, the Recovery and Resilience Facility, the Modernisation Fund established pursuant to Article 10d of Directive 2003/87/EC, REPowerEU, the Single Market Programme and the STEP. The financial support should include seed-funding to be provided by the Commission to set up the European Net-Zero Industry Academies (the ‘Academies’) and to allow their functioning with a view to becoming financially sustainable three years after their establishment, including by receiving financial contributions from the private sector.

(104)

The Academies should be launched to develop education and training programmes, content and materials, as well as the credentials indicating that a learning programme has been developed by one of the Academies, to upskill and reskill people of all working ages required for key net-zero technology value chains and to offer those programmes, content and materials to appropriate education and training providers and other actors involved in up- and reskilling in the Member States for their voluntary use. The Academies should play a facilitating role, fully respecting the responsibility of the Member States for the content of teaching and the organisation of education systems and for the content and organisation of vocational training. In doing so, the Academies should contribute to the long-term objective of simultaneously reindustrialising and decarbonising the Union, responding to critical skills shortages, as well as contributing to its open strategic autonomy and addressing the need for Union-made net-zero technologies, by strengthening its ability to innovate and produce. The Academies should be launched on the basis of an assessment by the Commission of skills shortages, relying on existing and objective studies, in net-zero technology industries key for the industrial transformation and decarbonisation. Each Academy should develop an action plan setting out milestones and targets, including in terms of number of learners to be based on the assessment of skills shortages.

(105)

The Academies should encourage teaching of transversal skills facilitating occupational mobility, together with other required skills. The Academies should make their learning content available in different languages so that the learning programmes can be accessed by as many learners as possible. They should provide training at all skills levels to the extent needed, thus targeting all levels of education and qualifications along the value chain of the concerned sectors. Education and training providers in the Member States may complement education and training content and materials developed by the Academies with additional relevant information prepared at Member State level and reflecting, for example, national law on labour and social rights, applicable collective agreements or territorial or sector-specific requirements, involving social and economic partners where relevant. The learning content should also target employees in national and local administrations, in particular those responsible for permitting, impact assessment and regulations of new technologies, thus contributing to capacity building among national administrations and to a reduction of disparities among Member States.

(106)

In order to support skills transparency and portability and the mobility of workers, the Academies will develop and promote the deployment by education and training providers of credentials, including, if appropriate, micro-credentials covering learning achievements. The credentials developed by the Academies may be issued by education and training providers or awarding bodies in the Member States, where an education and training programme developed by the Academies has been completed successfully. The credentials should be issued in the format of European digital credentials for learning and can be integrated in Europass and, where relevant and feasible, included in National Qualifications Frameworks. The European network of employment services (EURES), which provides information, advice and recruitment or placement for the benefit of workers and employers across the Union, can play a significant role in the publication of vacant positions related to net-zero technologies and, where appropriate, the deployment of European occupation profiles.

(107)

The Platform should provide assistance in guiding the work of the Academies, ensuring that their content addresses the skills shortages identified in the Commission’s assessment and providing general oversight. Member States should ensure that the appointed national representative can act as a bridge between the relevant national ministries and competent authorities of the Member States as well as the national social partners and industry representatives. The Platform should monitor progress made by the different Academies, analyse the root causes of skills shortages and identify to what extent the deployment of the Academies’ training programmes addresses skills shortages in net-zero technology industries and complements existing training opportunities in net-zero technologies in the Member States. The Platform should report on the deployment of the learning programmes, including through a progress report to be submitted three years after the establishment of each Academy and specifying the number of learners benefiting from the Academies’ programmes disaggregated by industrial sectors, gender, age, and levels of education and qualification.

(108)

In the absence of specific provisions in Union law introducing minimum training requirements for access to a regulated profession or the pursuit thereof, deciding whether and how to regulate a profession is the competence of Member States. However, national rules organising access to regulated professions should not constitute an unjustified or disproportionate obstacle to the exercise of those fundamental rights. The competence to regulate access to a profession must be exercised within the limits of the principles of non-discrimination and proportionality, in accordance with Directive (EU) 2018/958 of the European Parliament and of the Council (47). In their assessment, Member States should take into account any detrimental effects that regulation or professions may have on the availability of skills in the Net-Zero Industry and seek to limit the regulation in these fields to the maximum extent possible.

(109)

Where Member States determine that the learning programmes developed by the Academies are equivalent to the specific qualifications required by the host Member State to access regulated activities within the scope of a profession with particular interest for the net-zero industry in that Member State, Member States should, in the context of access to a regulated profession and in order to facilitate the mobility in net-zero industry professions, treat those credentials as sufficient evidence of formal qualifications, in accordance with Article 11 of Directive 2005/36/EC of the European Parliament and of the Council (48).

(110)

The contribution of net-zero technologies to the decarbonisation objectives of the Union can only materialise when those technologies are deployed. That deployment, to an extent, is likely to happen in private households, but most decarbonisation is likely to come from decarbonising industrial processes. In order to ensure that investments for such decarbonisation take place in the Union, which is essential to secure quality jobs and prosperity in the Union as well as to fulfil the Union's decarbonisation objectives, it is crucial that this Regulation contributes to an improvement of the investment climate for industry in the Union.

(111)

At Union level, a Platform should be established, composed of the Member States and chaired by the Commission. The Platform may advise and assist the Commission and Member States on specific questions and provide a reference body, in which the Commission and Member States coordinate their action and facilitate the exchange of information on issues relating to this Regulation. The Platform should, furthermore, perform the tasks set out in this Regulation, in particular in relation to permitting, including single points of contact, Net-zero strategic projects, coordination of financing, access to markets, skills, net-zero regulatory sandboxes as well as assisting the Commission in assessing the feasibility and proportionality of proposing measures if the Commission concludes that the general objectives of this Regulation are not likely to be achieved. Where necessary, the Platform may establish standing or temporary subgroups and invite third parties, such as experts or representatives from net-zero industries.

(112)

Where appropriate and useful, the Platform should seek close collaboration with other relevant Commission initiatives, platforms and groups, in order to seek synergies, share expertise, exchange information and foster stakeholder involvement, whilst avoiding duplication and overlaps. The Platform will engage with existing Union industrial alliances, and thereby contribute to the work of the alliances by involving Member States. Key alliances for collaboration with the Platform are the European Battery Alliance, the European Solar Photovoltaic Industry Alliance, the European Clean Hydrogen Alliance, the Alliance for Zero-Emission Aviation, the Industrial Alliance on Processors and Semiconductor Technologies and the Renewable and Low-Carbon Fuels Value Chain Industrial Alliance. Sectors which are not currently represented in industrial alliances equally benefit from the structured framework that the Platform provides. As regards net-zero strategic partnerships, close collaboration with the Critical Raw Materials Board is provided for where relevant.

(113)

Reducing the regulatory and administrative burden and having a suitable regulatory framework is particularly important for industries to adjust effectively to the climate and energy transitions. Therefore, the Union should aim to achieve by 2030 a significant reduction of the general regulatory burden on industry, in particular for placing a new product on the internal market. Those efforts should, in particular, be made within the Better Regulation framework and without prejudice to the Union’s environmental and labour standards. The Commission should inform the Platform of developments regarding the regulatory and administrative burden for net-zero technology industries in the Union on the basis of the Commission’s report of 24 October 2023 entitled ‘Progress on competitiveness of clean energy technologies’ and the Commission’s Annual Burden Survey 2022. To facilitate the work of Union institutions to keep the regulatory burden for net-zero technology industries at a minimum, this Regulation establishes a Net-Zero Regulatory Burden Scientific Advisory Group (the ‘Scientific Advisory Group’). The Scientific Advisory Group should develop science-based advice on the impact of the regulatory burden in the Union on net-zero industries, utilising a science-based methodology, and where appropriate taking into account the Better Regulation Toolbox, for the assessment of the impact of regulatory burdens. The work of the Scientific Advisory Group is without prejudice to the prerogatives of the Union’s institutions.

(114)

Regulation (EU) 2018/1999 provides that Member States are to submit updated drafts of their 2021 to 2030 national energy and climate plans. As emphasised in the Commission’s Guidance to Member States for those updates, the updated national energy and climate plans should describe Member States’ objectives and policies to facilitate the scale-up of manufacturing projects of commercially available energy efficient and low-carbon technologies, equipment and key components within their territory. Those plans should also describe Member States’ objectives and policies to achieve that scale-up through diversification efforts in third countries, and to enable their industries to capture, transport, and store CO2 emissions permanently in geological storage sites. Those plans should form the basis upon which the need for net-zero technologies is determined. When taking into account this Regulation in the preparation of their national energy and climate plans, Member States should consider both general competitiveness as well as research and innovation in the field of net-zero industries in the longer term.

(115)

As part of the Green Deal Industrial Plan, the Commission announced its intention to conclude Net-Zero Industrial Partnerships covering net-zero technologies, stepping up its efforts to join forces with partners committed to the Paris Agreement. Cooperation through such Partnerships is likely to promote the adoption of net-zero technologies globally and to support mutually reinforcing partnerships between the Union and third countries, including sustainable investments and technical assistance. The Net-Zero Industrial Partnerships should be mutually beneficial for the Union and its partners, and should contribute to the achievement of global climate objectives. Those Partnerships can also contribute to the diversification and resilience of the Union’s supply of net-zero technologies and their components, enhance information sharing between the Union and its partners on the development of net-zero technologies and support the Union’s net-zero industries in accessing the global clean energy market, while supporting nascent industries in the field of clean energy technologies in third countries with clear comparative advantages. The Commission and the Member States may coordinate the Net-Zero Industrial Partnerships within the Platform, discussing existing relevant partnerships and processes, such as green partnerships, energy dialogues and other forms of existing bilateral contractual arrangements, as well as potential synergies with relevant Member States’ bilateral agreements with third countries.

(116)

The Union should aim to diversify and stimulate international trade and investments in net-zero technologies building mutual reinforcing partnerships, while promoting globally high social, labour and environmental standards. That should be done in close cooperation and partnership with like-minded countries by means of existing agreements or new strategic engagements. Similarly, stronger international cooperation on research and innovation efforts to develop and deploy net-zero technologies should be pursued in close cooperation with partner countries in an open and balanced manner, and on the basis of reciprocity and mutual interests.

(117)

In order to identify and mitigate potential supply risks related to net-zero technologies it should be possible to monitor, on an ongoing basis, indicators related to market trends, manufacturing capacities, innovation, employment and skills, permitting times of net-zero technologies, and CO2 injection capacities. However, currently there is not sufficient high quality data available to monitor those indicators. As the tasks provided for in this Regulation depend on the availability of quality data, it is necessary for the Commission to prioritise, in its monitoring, among the net-zero technologies on the basis of their importance in the Union while working on the improvement of the availability of such data. The Commission will also work closely with Eurostat, the statistical authority of the Union, to develop common codes for net-zero technologies necessary for high-quality, long-term reporting and statistics.

(118)

Where the power to adopt acts in accordance with Article 290 TFEU is delegated to the Commission under this Regulation, it is of particular importance that the Commission carries out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Inter-institutional Agreement on Better Law-Making of 13 April 2016 (49). In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States’ experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts.

(119)

To the extent that any of the measures envisaged by this Regulation constitute State aid, the provisions concerning such measures are without prejudice to the application of Articles 107 and 108 TFEU.

(120)

Since the objective of this Regulation cannot be sufficiently achieved by the Member States and can rather, by reason of the scale or effects of the action, be better achieved at Union level, the Union may adopt measures in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve that objective,