Issue link: https://maltatoday.uberflip.com/i/1509057
Greta Camilleri 10 NEWS 5.10.2023 Greta Camilleri is EU Affairs Manager within the Economic Intelligence, Research, EU Affairs Unit at Malta Enterprise The NZIA – EU's plan for industrial climate neutrality THE recent forest fires in the Mediterranean and the errat- ic weather conditions have clearly indicated that globally, we are in a climate emergency. is has economic, social and environmental ramifications. Furthermore, geopolitical tensions, a shortage of criti- cal resources, China's and the United States' advancements in Clean Tech are further pushing up Europe's agenda to invest more in its industrial policy based on open strategic autonomy. ese developments moti- vated the EU to launch the ambitious European Green Deal aiming to become the first climate-neutral continent by 2050 based on the Paris Ac- cords. One of the fundamental pil- lars of the Deal promotes at- taining a simplified regulatory framework to improve EU's industrial competitive edge via resource-efficiency and green investments, thus leading to a swifter green transition. ese events compelled the European Commission (EC) to revamp its Industrial Poli- cy, propose a Net-Zero Indus- try Act (NZIA), revise the EU State Aid Regulation Frame- work; and initiate the Critical Raw Materials Act. 'Net- zero'? Very often, the meaning of the term 'net zero' is mis- conceived. This term does not mean nil pollution levels. Rather, it implies cutting down greenhouse gas emissions to as close to 0% as possible. The emissions which would be produced are to be eliminated from the atmosphere through natural re-absorption, such as through ocean basins. None- theless, transitioning to a 'net-zero world' poses numer- ous challenges to various sec- tors which must heavily invest in replacing current polluting practices with cleaner ones. The proposed Act will strengthen Europe's manu- facturing capacity of net-ze- ro technologies to overcome hurdles when scaling up namely through stimulating the production of renewable energy and financing the re- quired infrastructure. This Act will promote the facilita- tion of net-zero technologies to gain market access through public procurement and pri- vate investments. Fostering further innovation in manu- facturing processes and final products is key and can possi- bly lead to the development of more regulatory sandboxes. Expedient regulation, scale-up support e draft proposal of the NZIA identifies several stra- tegic net-zero technologies which will contribute towards efficacious de-carbonization once they are market ready. e Act will further promote the development and deploy- ment of such technologies through the establishment of a tailored regulatory frame- work. e rationale being to grant 'priority status' to pro- jects of strategic European importance to benefit from shorter timelines and support the scale-up of Clean Tech across Member States. e proposal, amongst oth- ers, prioritises projects tied to wind, solar, battery, carbon capture and storage types of technologies. Increasing the EU's manufacturing capacity will lead, to a certain extent, to less dependencies on non-EU countries, as well as facilitate attaining ambitious climate and energy targets. Net-zero academies and industrial partnerships Apart from creating in- vestment conditions, imple- menting the proposed Act calls for a workforce that has wide-ranging skills. Current- ly, finding adequately quali- fied employees is challenging due to skills shortages. Intro- ducing Net-Zero Academies, Member States will have the opportunity to deliver various training programmes focused on Net-Zero industry tech- nology with the sole aim to enhance the skills required. e introduction of a Net-Ze- ro Europe Platform will assist Member States and the EC to coordinate their actions and promotes the exchange of information particularly in terms of Net-Zero Industri- al Partnerships. rough this Platform, affected stakehold- ers may identify ways how to adopt best practices and prior- itize investments. Introducing the NZIA is part of the EU's efforts in recogniz- ing the huge growth poten- tial which exists in the area of net-zero technology and serves to incentivize manu- facturers and developers to in- vest in product innovation and production processes. Malta's NZIA example A good example of the move- ment towards Clean Tech is the Maltese automobile com- ponents sector that is very much integrated with the Eu- ropean eco-system. is sector is diverse and plays an impor- tant role in our manufactur- ing landscape. It includes the production of semiconductor chips to electronic switch gear to rubber O-rings. Clearly, the largest challenge of the Euro- pean automobile industry is the gradual phasing out of the integral combustion engine and ramping up the sales of electric vehicles. e Maltese automobile components sec- tors is gradually preparing for this transition. A flagship initi- ative of this change is the Im- portant Projects of Common European Interest (IPCEI) that the largest semiconductor backend facility is carrying out through an Industry 4.0 pro- ject. In the last two years, Malta Enterprise has intensified its efforts at EU level to provide the best support to businesses to capitalise on European opportunities and beyond. Companies interested in ob- taining further updates on the NZIA are to contact Malta Enterprise on euaffairs@mal- taenterprise.com