As part of its push to revive industrial competitiveness while accelerating the green transition the European Commission unveiled its Clean Industrial Deal on 26 February 2025. The strategy comes in response to growing pressures: high energy costs, global competition—particularly from the U.S. and China—and a broader concern over Europe's declining manufacturing base. Building on the ambitions of the European Green Deal, the new initiative introduces more concrete financial and regulatory tools to align climate goals with industrial renewal.
As pointed out by Commission’s executive vice-president Stéphane Séjourné, the Deal builds on four pillars: boosting demand, cutting costs, improving financing, and securing critical inputs.
To boost demand, the Deal aims to create a strong European market for clean industrial products. This includes expanding green public procurement, introducing voluntary carbon labelling, and advancing mechanisms such as the Carbon Border Adjustment Mechanism (CBAM) to shield EU industries from carbon leakage while promoting fairer global competition.
On costs, particularly for energy-intensive sectors, the Deal proposes an Action Plan for Affordable Energy. It focuses on accelerating investments in renewable capacity, modernising and interconnecting electricity grids, and supporting the electrification of industry. Additionally, efforts to simplify permitting processes and facilitate infrastructure deployment are key components.
To strengthen financing, the proposal establishes a dedicated €100 billion Industrial Decarbonisation Bank under the European Investment Bank, aiming to de-risk clean tech investments. This is backed by more flexible state aid frameworks, improved access to EU funds, and enhanced private sector involvement through guarantee schemes.
Securing critical inputs is the final priority. The Deal addresses material dependencies by promoting circularity, increasing recycling targets, and diversifying trade partnerships. It also includes a push to build up European production capacities in key technologies and raw materials to ensure industrial resilience.
Altogether, the Clean Industrial Deal offers a focused set of tools to enhance competitiveness, support decarbonisation, and bolster strategic autonomy in the global race for clean industry.
While the Clean Industrial Deal marks a major step toward aligning EU industrial and climate goals, several critical concerns have been raised. Analysts note the broad scope of the Deal could lead to coordination challenges and diluted focus. The financing mechanisms, though ambitious, lack clarity and may not be mobilized quickly enough. Additionally, the inclusion of regulatory simplification measures, such as the "Omnibus" packages, could undermine existing environmental standards, contradicting the spirit of the European Green Deal. There are also concerns that the Deal could exacerbate regional inequalities, disproportionately benefiting more developed Member States. Finally, critics worry that the plan shifts focus away from long-term ecological transformation by emphasizing competitiveness over sustainability.