NZIA implementation

EUROPEAN COMMISSION DIRECTORATE-GENERAL FOR INTERNAL MARKET, INDUSTRY, ENTREPRENEURSHIP AND SMES The Director-General DIRECTORATE-GENERAL FOR ENERGY The Director-General Brussels GROW/DG/sbn/i.3 (2024)4772229 NOTE TO THE ATTENTION OF EU DIRECTOR-GENERALS OF MINISTRIES OF ECONOMY AND MINISTRIES OF ENERGY Subject: Implementation of the Net-Zero Industry Act Dear Director-General, The Net-Zero Industry Act (‘NZIA’) entered into force on 29 June 2024 1. As a central pillar of the Green Deal Industrial Plan, NZIA aims to scale up the manufacturing of net-zero technologies in the European Union. As such, it will help us achieve the EU 2030 climate and energy objectives, while enhancing the competitiveness of net-zero industries and the security of Europe’s energy system. The Commission looks forward to working closely with Member States on implementing NZIA swiftly and thoroughly. The High-level event anticipating the Net-Zero Industry Act held on 23 May 2024 showed to what extent this sense of urgency is widely shared among Member States and industry alike. NZIA is a token of our collective conviction: for the EU to fully harness the ongoing energy transition, it must remain a major producer of net-zero technologies, and it can only do so through a forceful policy framework. This is why NZIA introduces an ambitious goal for net-zero manufacturing capacity: to meet at least 40% of the EU’s annual deployment needs by 2030. By doing so, NZIA provides predictability and long-term signals to manufacturers and investors. It will empower European industry to scale the net-zero business case. In Annex 1 to this letter, we outline the most immediate implementation deliverables and present a way forward. We would be grateful to receive your feedback on a limited set of issues, namely those highlighted in bold, by 12 July 2024. Yours faithfully, (E- signed) (E- signed) Kerstin Jorna Ditte Juul Jørgensen Annexes: 1. Implementation deliverables and way forward 2. NZIA Strategic Project Application process 3. Summary of High-Level event on 23 May c.c.: Attachés of Council working party on industry and energy (1) Regulation - EU - 2024/1735 - EN - EUR-Lex (europa.eu) Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË – Tel. +32 22991111 Office: BREY 11/055 – Tel. direct line +32 229-89097 Annex 1: Implementation deliverables and way forward 1. Overview of the most immediate implementation deliverables Here below you may find the most immediate implementation aspects. In the following section, these are described in more detail and a way forward is presented. For Member States: - Designation of Single Points of Contact (Article 6(1)) by 29 December 2024 (6 months as of entry into force). For the Commission: - Convening of the first formal meeting of the Net-Zero Europe Platform, in Q4 2024; - Support to Member States regarding strategic project applications, by proposing and putting in place a harmonised process, shortly following entry into force; - On public procurement, providing orientation to Member States and relevant procurement authorities on the application of requirements that become mandatory with the entry into force, and those that will become mandatory following the adoption of relevant implementing acts, notably on the environmental sustainability criterion (Article 25(5)) and on the resilience criterion (Article 29(2)); - Adoption of all relevant implementing and delegated acts by the timelines foreseen in the Act. For those that do not have specific deadlines, the Commission will work towards the speediest adoption possible. 2. Way forward on the most immediate implementation deliverables 2.1. Single Points of Contact NZIA Article 6(1) requires that Member States designate the Single Point of Contact within 6 months of entry into force. Single Points of Contact are responsible for facilitating and coordinating the entire permit-granting process for projects in the scope of NZIA. This day will be very fast approaching and we suggest that you start preparing as soon as possible. Designating a Single Point of Contact and making it fully operational is essential to ensure compliance with NZIA, in particular with the different tasks and obligations set out in Article 6 on facilitating and coordinating the permit-granting process, Article 7 on online accessibility of information, Article 9 and 16 on the duration of the permit-granting process, Article 10 on environmental assessments and authorisations, as well as Article 18 in the context of the designation of a Net-Zero Acceleration Valley. Please keep in mind the possibility to sign up to the Technical Support Instrument (‘TSI’) to get EU funded support on streamlining permitting processes, including further assistance on developing your Single Point of Contact. The 2025 TSI call will be open until 31 October and has a dedicated flagship covering NZIA (ESTER - Economic Security in Technologies and Resources)2. 2.2. Strategic Project application process NZIA provides the possibility for net-zero technology manufacturing project promoters to apply for strategic project status. Please note that net-zero strategic projects as referred to in this letter only covers those that are net-zero technology manufacturing projects (Carbon, Capture and Storage projects will not be part of the initial strategic project application process3). The Regulation outlines the corresponding benefits (Article 15-16), the application and recognition process (Article 14) and the selection criteria (Article 13). (2) https://reform-support.ec.europa.eu/tsi-2025-flagship-economic-security-technologies-and-resources_en (3) A complementing letter will be provided to you regarding the deployment objectives of operational CO 2 injection capacity by 2030 and the recognition of net-zero strategic projects CO2 storage projects in the context of development of Industrial Carbon Management solutions for EU industries (see Art. 20-24 NZIA and COM(2024) 62 final). 2 Following successful application and recognition, net-zero strategic projects will benefit from priority status at national level, faster permitting and advice - through the Net-Zero Europe Platform - on access to finance. Following the Act’s entry into force and as a follow-up to the conclusions of the High-Level Meeting of 23 May 2024, the Commission will very soon put in place an application process to operationalise the strategic project status. This will involve the following elements: - A pre-set application form on a dedicated website, allowing project promoters to send their application to the Member State authorities in charge of assessing it. - Putting in place an application process (visualised in Annex 2) that ensures user-friendly and secure document transmission; ensures that only ‘complete’ applications reach the Member States; provides a harmonised approach to Member States and project promoters; and which reduces the administrative burden of Member State authorities. The Commission will facilitate the process and will not have access to the complete application to the Member States, unless it is required to interact with the applicant or Member States as foreseen in the Regulation. In addition, the Commission will issue a short, practical guidance for Member State authorities and another one for project promoters on how to use this system. The Commission will organise a webinar with Member States to explain the process, as well as promote via relevant communication channels the possibility for project promoters to apply. - An update of the dedicated Commission website with information on the strategic projects, the application process and possible links to financing portals such as the InvestEU Advisory Hub. In turn, Member States are kindly requested to: - Provide the contact information (name, department, ministry, e-mail address, telephone number, EU Login user ID and EU Login e-mail address) of the national contact point to which the net-zero strategic project applications shall be sent (this is not the same as the NZIA ‘single point of contact’). Please kindly note that to be fully operational, the national contact point will need to create an EU Login account by using the self- registration page to create an account: https://webgate.ec.europa.eu/cas/login. If needed, a tutorial is also available.4 - Please kindly take note of the visualised application process in Annex 2 to this letter. This process is also currently being put in place for a similar strategic project application process under the Critical Raw Materials Act. ➢ Please communicate your national contact point that will be in charge of receiving NZIA strategic project applications and inform of any comments on the proposed application process by 12 July 2024 to [email protected]. 2.3. Public Procurement NZIA Article 25 on public procurement introduces three sets of qualitative non-price criteria: environmental sustainability, resilience, and an additional criterion to be chosen from cybersecurity, social considerations, and the ability to deliver. While the requirement to apply the criteria on environmental sustainability and resilience takes effect with the adoption of the related implementing acts, the additional criterion should be applied from the entry into force of NZIA onwards. Applying the non-price criteria as soon as possible is crucial. The Commission Recommendation5 and Guidance6 to Member States on auction design for renewable energy includes guidelines on the application of non-price criteria, including the ones related to social and cyber-security aspects, that are also relevant for procurement procedures. The Commission services will support you on the application of those criteria. (4) https://webgate.ec.europa.eu/cas/manuals/EU_Login_Tutorial.pdf. (5) C(2024) 2650 final (6) SWD(2024) 300 final 3 In addition, and in line with the European Solar7 and Wind8 charters recently signed by many Member States and the Commission, we strongly encourage you to apply the criteria on environmental sustainability and resilience already before the related implementing acts are published. Latest available data9 already shows that for solar photovoltaic modules and cells EU imports from a single source of supply, in this case from China, account for approximately 90% of EU supply. The Community of Public Buyers for Sustainable Solar PV supports public buyers to improve the quality, sustainability and financial returns of their photovoltaic project. It also provides information to apply sustainability criteria to the procurement of photovoltaic technologies. The Commission further aims to assist procuring authorities in applying NZIA, making use of existing collaboration frameworks and tools. On 28 June 2024, a meeting with procurement professionals from the Member States (EXPP group) took place to discuss the implementation of the public procurement article. For the abovementioned implementing acts, the Commission is striving to deliver them within the fastest timeframe possible. On the side of the Member States, we would ask you to make sure your contracting authorities are aware of the new rules taking effect. The Commission will assist you in applying non-price criteria as soon as possible. We count on you to use your network to make purchasing authorities aware of the new rules and recommend an ambitious approach given the urgencies faced. 2.4. Net-Zero Europe Platform NZIA establishes the Net-Zero Europe Platform (Articles 38-39), the Act’s governance body which will oversee implementation. To help achieve the Act’s ambition, the Net-Zero Europe Platform will be set up and composed of a representative from each Member State, with the Commission as Chair. The high-level representatives, at Director-General level, will meet at least annually to monitor the progress of implementation and agree on objectives and a work plan. The first high-level meeting of the Platform will take place in Q4 of 2024. The Platform’s work is based on exchanges of best practices, as well as coordinating and monitoring the implementation of relevant provisions. As required by NZIA Article 39(6), the first sub-group to be established will cover Net-Zero Industry Academies. Additional sub-groups may be set up on the basis of Member States’ requests, in particular following the first formal high-level meeting of the Platform. A first such request was made at the High-Level meeting on 23 May, for a sub-group on Net-Zero Acceleration Valleys. In parallel, the Commission will advance the preparation for setting up a Net-Zero Industry group, consisting of industry representatives, and the Net-Zero Regulatory Burden Scientific Advisory Group, made up of independent scientists. We kindly ask you to inform us of the names of your appointed high-level representative and deputy high-level representative. ➢ Please communicate your high-level representatives (name, position, e-mail address) to the Net-Zero Europe Platform by 12 July 2024 to GROW- [email protected]. 3. Questions on priorities regarding NZIA technologies Finally, to effectively plan ahead and for effective implementation, we would appreciate feedback on Member States' priorities. We kindly ask that a short questionnaire (3 questions) be filled out to flag your national priorities on specific technologies and the reasons for these choices. The answers are dealt with confidentially and may be presented in an anonymised and aggregated manner at the first High-Level Net-Zero Europe Platform meeting. ➢ Please fill out the EUSurvey on Member State priorities on net-zero technologies by 12 July 2024: https://ec.europa.eu/eusurvey/runner/NZIA-QforMS (7) https://energy.ec.europa.eu/topics/renewable-energy/solar-energy/european-solar-charter_en (8) https://energy.ec.europa.eu/news/new-wind-charter-and-national-wind-pledges-underline-ambition-wind- power-europe-2023-12-19_en (9) Eurostat (2024) ext-go_detail tables, ds-045409, Database - Eurostat (europa.eu) 4 Annex 2 Strategic projects as referred to in this letter only covers those that are net-zero technology manufacturing projects, CCS projects will not be part of the initial strategic project application process Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË – Tel. +32 22991111 Office: BREY 11/055 – Tel. direct line +32 229-89097 Annex 3 Summary of the High-level meeting in anticipation of the Net-Zero Industry Act and the Net-Zero Europe Platform 23 May 2024, 14:30 – 17:00 On 23 May 2024, European Commissioner for Internal Market Thierry Breton convened a High-Level Meeting with Member States in anticipation of the entry into force of the Net-Zero Industry Act (“NZIA") and the Net-Zero Europe Platform. Addressing the ministers, state secretaries and officials present, Commissioner Breton highlighted the importance of NZIA, with the focus now shifting to its effective implementation and the need to mobilise all EU tools – single market, trade, competition, budget – to promote European clean tech, build smart partnerships and protect a level playing-field. In his opening remarks, Johan Hanssens of the Belgian Presidency of the Council of the EU stated that the speed at which NZIA was negotiated underlined its importance for the EU and that it was an excellent example of inter-institutional cooperation. He concluded by stating that NZIA marks a fundamental step in industrial policy and in the development of a new competitiveness deal, setting the stage for the next legislative term. Invited industry leaders from the wind and solar photovoltaic (PV) manufacturing industries, and energy-intensive industries, shared their views on the Act’s foreseen positive impact on their business case. They welcomed the aim of creating a level playing field across the entire value chain through reducing regulatory burden, facilitating shorter permitting, and simplifying procedures. The provisions on public procurement and auctions were coined as the potentially most impactful of the Act, though it was underlined that in line with the European Solar and Wind Charters these provisions needed to be applied by Member States with urgency. Member States underlined the importance to implement NZIA in a fast and harmonised manner as well as to build on the strengths of countries in different parts of the net-zero value chains. They also noted that the permitting provisions have a strong signalling effect and were of high importance in terms of investment certainty, increasing predictability and for simplifying and streamlining procedures. Several Member States informed that they plan to or are currently reviewing permitting legislation, including environmental legislation, to streamline processes. Member States also anticipated the establishment of the Single Points of Contact, which are required to be operational within 6 months of the Act’s entry into force. Certain Member States highlighted existing initiatives that are similar in function to the Single Point of Contact, notably also stressing the importance of digitalising the processes. It was also stated that the exchange of best practices in the framework of the Net- Zero Europe Platform would be strongly welcomed. Several Member States expressed their support for establishing Net-Zero Acceleration Valleys and expressed strong interest to explore the opportunities these might bring, suggesting also the creation of a specific working group within the Net-Zero Europe Platform. On financing, the representative of the European Investment Bank (EIB) underlined the bank’s commitment as EU Climate Bank to support investments in net-zero manufacturing capacities. Venture debt and the partnership with Breakthrough Energy (and the Commission) to fund joint projects on climate technologies have been mentioned as examples of effective instruments. Several Member States underlined the importance of availability of financial resources to support NZIA objectives. Combining national resources with EU ones, provision of support and information to potential applicants about available funding opportunities, as well as the need to ensure and explore cohesion among Member States and regions, are among the main issues mentioned during the discussion. The meeting was also attended by the European Bank for Reconstruction and Development (EBRD) and by representatives of national promotional banks and ELTI (European Long-Term Investors Association). On access to markets, several Member States reported that they already have experience with non-price criteria, notably in the area offshore wind auctions and others that they would Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË – Tel. +32 22991111 Office: BREY 11/055 – Tel. direct line +32 229-89097 implement them already ahead of time notably for wind, heat pumps and solar PV. Member States noted that the impact of non-price criteria on cost and efficiency should also be considered, that best practice sharing is crucial to ensure effective administration, also for SMEs. Member States also stressed the significance of the resilience criterion and called for clearly defined and verifiable criteria. Around the entry into force of NZIA at the end of June, the Commission will make operational the system for granting strategic project status. Strategic projects have additional benefits under NZIA such as priority status at national level, faster permitting, and are focused on in the Net-Zero Europe Platform, also with regards to financing needs. The first formal meeting of the Net-Zero Europe Platform will take place in Q4 2024 as part of the next Commission mandate. Member States highlighted the importance of working together in the framework of the Platform. 7 Ref. Ares(2024)5826905 - 13/08/2024 EUROPEAN COMMISSION DIRECTORATE-GENERAL FOR ENERGY DIRECTORATE-GENERAL FOR INTERNAL MARKET, INDUSTRY, ENTREPRENEURSHIP AND SMES Just Transition, Consumers, Energy Security, Efficiency and Innovation Ecosystems IV: Mobility & Energy Intensive Industries The Directors Brussels ENER.B5/GROW.I.3 Subject: Invitation to appoint a permanent representative and an alternate representative to the informal Commission expert group on Net-zero technologies and supply chains and to the Net-Zero Technologies Committee Dear Sir, / Dear Madam, The Commission's Directorate-General for Energy ('DG ENER') and Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs ('DG GROW') are preparing the implementation of Regulation (EU) 2023/1735 of the European Parliament and of the Council of 13 June 2024 on establishing a framework of measures for strengthening Europe’s net-zero technology manufacturing ecosystem and amending Regulation (EU) 2018/1724 (Net-Zero Industry Act). This implementation includes, inter alia, two Implementing Acts and a Delegated Act, namely: (1) The Implementing Act setting out guidelines ensuring uniform conditions for the implementation of the net-zero strategic project selection criteria; (2) The Implementing Act providing for a list of each of the net-zero technology final products and their main specific components; (3) The Delegated Act to amend the Annex of the Net-Zero Industry Act with regard to the primarily used components. Pursuant to Articles 13(2), 29(2) and 45(1)-(2) of the Regulation, the Commission will be assisted in the preparation of the above-mentioned Implementing Acts (points 1, 2) by a Committee (Net-Zero Technologies Committee - C129000) in a comitology procedure following the rules applicable to the examination procedure under Article 5 of Regulation (EU) No 182/2011. To assist the Commission on issues regarding net-zero technologies supply chains and on the preparation of the above-mentioned Delegated Act, a new Expert Group on ‘Net-zero technologies and supply chains’ (E03968) has been set up. Member States are invited to nominate two representatives to the Net-Zero Technologies Committee and two representatives to the Expert Group on Net-zero technologies and supply chains by 31 August 2024 in writing to the following email Commission européenne/Europese Commissie, 1049 Bruxelles/Brussel, BELGIQUE/BELGIË – Tel. +32 22991111  address: [email protected]. One of the appointed representatives should serve as a permanent representative, and the other as an alternate representative. It is essential that these representatives have a high level of expertise relevant to their roles. Since the Implementing Act on main specific components and the Delegated Act are closely interrelated, close collaboration should be possible between the representatives. Please note that the Expert Group can have the same composition as the Committee. The name of the Member State's authorities participating in the expert group shall be published in the register of expert groups. The first Expert Group meeting and the first Comitology Committee meeting will take place consecutively on the same day on 30 September 2024. Please ensure to save this date. An official invitation will follow shortly. For any correspondence related to the group, we invite you to use the functional mailbox [email protected]. Yours faithfully, E-signed E-signed Paula PINHO Joaquim NUNES DE ALMEIDA Contact: [email protected] 2 Electronically signed on 13/08/2024 13:54 (UTC+02) in accordance with Article 11 of Commission Decision (EU) 2021/2121