The European Union, in a clear desire for energy transition and industrial sovereignty, is deploying the Net-Zero Industry Act (NZIA), an ambitious initiative adopted in June 2024 as part of the Green Deal Industrial Plan. This text aims to strengthen the production of clean technologies in Europe, while responding to the American dynamics of the Inflation Reduction Act (IRA).
The objectives of the NZIA are clear: to meet 40% of European needs in clean technologies by 2030 and to represent 15% of global production by 2040. Priorities include key sectors such as hydrogen, solar photovoltaics and carbon capture technologies. This initiative is part of an industrial competitiveness strategy, while accelerating the energy transition and reducing carbon emissions.
To facilitate this transformation, the NZIA introduces a simplified procedure for the approval of industrial projects related to Net-Zero technologies. The timeframes are considerably reduced: 12 months for projects under 1 GW and 18 months for those exceeding this capacity.
An ambitious national strategy: the French solar pact
France, for its part, is actively investing in the development of its solar capacities. Between 2020 and 2024, solar installations increased from 2 GW to 3.3 GW, but the country is still far from the government’s target of 6 GW per year.
To achieve this target, the solar pact provides for a stronger mobilization of public and private resources. As early as 2025, ESG (Environment, Social, Governance) criteria will be introduced in public procurement, with an incentive bonus for projects using solar panels manufactured in Europe.
A strategic tax credit launched in March 2024 is expected to generate €23 billion in direct investment and create 40,000 jobs in the French photovoltaic sector.
Greening public procurement
From 2025, public contracts exceeding €25 million will have to meet strict requirements: no product originating from more than 50% of third countries will be able to be integrated. This measure aims to reduce dependence on foreign imports, while stimulating local production.
However, the current low European production capacity could pose challenges. Strengthening the competitiveness of local manufacturers and accelerating industrial production of solar panels will be priorities to avoid a supply disruption.
Financial challenges
Although the NZIA encourages private investment and mobilizes existing public funds, project financing remains a major challenge. Current European resources, such as the Horizon Europe program or the Just Transition Mechanism, appear insufficient compared to the massive amounts invested by the United States via the IRA.
However, a possible dismantling of the IRA under a new US administration could open a window of opportunity for Europe, allowing it to strengthen its capacities in a redefined international context.
Building energy sovereignty
European actors in the solar industry are organizing themselves to meet these challenges. Their commitments include the promotion of a solar panel performance index called InduScore, the signing of long-term contracts to secure the supply and deployment of at least 30% InduScore certified panels by 2025.
However, China’s dominance of the global photovoltaic market remains a major obstacle. China’s industrial capacity, which far exceeds European needs, continues to pose a significant challenge to European energy sovereignty.
Conclusion: Ambitions to be realized
The Net-Zero Industry Act and the French Solar Pact are key levers to enable Europe to meet its climate and energy targets. However, several challenges remain to be overcome: securing sustainable financing, reducing dependence on imports and accelerating local production.
The success of these initiatives will require close coordination between European institutions, national governments and private actors. In France, the Solar Pact offers a unique opportunity to position the country as a European leader in solar energy. To achieve this, these challenges will have to be met with an ambitious vision, a stable regulatory framework and adequate financial resources.
Chronicle by Benoit Frayer
