Event Summary: From Green Deal to Clean Industrial Deal — Enough to Ensure Europe’s Competitiveness?

On April 24, 2025, Marcus Lippold (European Commission) delivered a keynote presentation at Sciences Po titled “From Green Deal to Clean Industrial Deal — Enough to Ensure Europe’s Competitiveness?”, as part of a high-level event exploring the evolving architecture of the European Union’s green transition. The presentation was hosted by the European Chair for Sustainable Development and Climate Transition and aimed to assess how the European Green Deal is evolving into a broader Clean Industrial Deal (CID), focused on reconciling climate neutrality with industrial competitiveness.

From Green Deal to Clean Industrial Deal: Strategic Evolution

Lippold opened his remarks by retracing the vision of the European Green Deal, launched in 2019 as the EU’s flagship strategy to reach net-zero emissions by 2050. More than just a climate initiative, the Green Deal is positioned as Europe’s new growth model, supporting systemic transformation across energy, industry, mobility, agriculture, and finance. While the strategy entails high transition costs, he noted that the cost of inaction, potentially 12% of global GDP by century’s end, would be far greater.

Despite recent achievements, including a 37% reduction in GHG emissions since 1990, 45.3% renewables in the EU electricity mix by 2023, and increasing energy efficiency, Lippold emphasized growing strains on the EU’s competitiveness. Electrification has stalled at 22–23%, and retail electricity prices in many member states have surged to 2.5 times those in the U.S.

In this context, the European Commission is rolling out the Clean Industrial Deal, a targeted response to declining industrial competitiveness and emerging geopolitical risks. This strategy seeks to turn the EU into a globally competitive low-carbon industrial base.

The Clean Industrial Deal: Pillars and Policy Levers

The CID builds on the Green Deal’s foundation while focusing explicitly on the industrial dimension of the green transition. Lippold outlined the five central pillars of the CID:

1. Affordable Clean Energy:
   • Complete the EU’s internal energy market through physical interconnection.
   • Accelerate electrification and rollout of renewables while improving permitting.
   • Reduce dependence on imported fossil fuels.
2. Lead Markets for Clean Products:
   • Promote EU-made low-carbon goods in public and private procurement.
   • Revise procurement frameworks to prioritize sustainability, resilience, and EU content.
3. Financing the Transition:
   • Establish an Industrial Decarbonisation Bank (IDB) with €100 billion in funding.
   • Reform InvestEU to increase guarantees for clean industrial investment.
4. Circular Economy and Raw Material Security:
   • Launch a Critical Raw Materials Centre for joint procurement.
   • Introduce a Circular Economy Act in 2026 targeting 24% material circularity by 2030.
5. Global Partnerships and Resilience:
   • Expand Clean Trade and Investment Partnerships with third countries.
   • Use the Carbon Border Adjustment Mechanism (CBAM) and trade tools to support EU industries.

Implementation Challenges and Policy Trade-offs

Lippold candidly assessed the operational challenges ahead. Electrification and permitting delays continue to hinder deployment of clean technologies. He underlined the risk of overly complex regulation and the need for simplification via the Omnibus Directive, aimed at reducing administrative burdens and streamlining green investment.

He further emphasized that industrial decarbonization cannot succeed without social cohesion and clarity on the 2040 climate targets, which include a 90% net emissions reduction. Policies such as ETS2 (the new emissions trading system), which extends carbon pricing to households from 2027, must be paired with equitable redistribution measures to maintain political support.

On financing, he highlighted the need to move from fragmented national instruments toward coherent EU-level strategies, including better use of ETS revenues, defense sector procurement, and state aid flexibility.

Europe’s Role in a Changing Global Landscape

Lippold warned that Europe risks falling behind in key sectors (solar, wind, EVs, AI, and access to critical raw materials) if industrial policy does not adapt. He advocated for rethinking competitiveness beyond cost leadership, embracing a model where carbon intensity, resilience, and sustainability define future industrial success. This requires investments in R&D, skills (especially STEM), and migration policies to counter demographic decline.

Conclusions: Towards a Competitive, Climate-Neutral Europe

In closing, Lippold argued that the CID represents a crucial evolution of the Green Deal, one that explicitly integrates industrial policy, trade strategy, and social safeguards. For the EU to remain economically competitive while delivering on its climate commitments, it must pivot from fragmented climate policy toward a holistic clean growth strategy.

Success will hinge on:

• Scaling electrification and clean tech deployment,
• Creating robust lead markets through procurement and trade,
• Aligning financing and skills development with industrial needs,
• And balancing climate ambition with social equity and economic realism.

The event highlighted the urgency of maintaining momentum in the green transition, not by diluting ambition, but by broadening its economic and geopolitical foundations.