Electricity producers, consumers suggest six measures to strengthen competitiveness of Europe’s industry

European electricity producers and consumers have defined six measures to strengthen the competitiveness of Europe’s industry and foster its decarbonization and electrification.

Eurelectric – Union of the Electricity Industry said that this year it came together for the first time with the representatives of energy-intensive sectors CEFIC and European Aluminium in the Antwerp Dialogues to discuss how to strengthen Europe’s competitiveness and electrify the industry.

The meeting, organized by the European chemicals (CEFIC), aluminium (European Aluminium) and electricity industry (Eurelectric) were joined by relevant stakeholders from the industry, the power sector, NGOs, unions and think tanks.

The Antwerp Declaration calls for urgent action including reducing energy prices and costs, removing barriers to timely infrastructure development and securing strong public funding.

Electricity retail prices for the industry are currently two to three times higher in the EU than in the US and China

In the short term, particularly the prices and costs of energy are simply too high to compete, the organizations said.

Electricity retail prices – specifically those for industrial sectors – are currently two to three times higher than in the United States and China. Historically, they have been up to 80% higher in the European Union than in the US while moving around the same level as in China, impacting the business case, overall investment, and progressively cascading throughout the economy, according to the document.

The representatives warned that moving outside of the EU, with a subsequent loss of jobs and domestic resilience, has already started and that without action the trend is set to increase.

The EU action plan for affordable energy prices will be an essential pillar of the envisaged Clean Industrial Deal

Against this background, the organizations see the upcoming EU action plan for affordable energy prices as an essential pillar of the envisaged Clean Industrial Deal.

The group – gathering more than ten sector associations – found consensus around six key actions:

1. facilitate access to power purchase agreements (PPAs) and long-term contracting for industrial consumers,
2. boost financing of low-carbon technologies,
3. level out electricity taxes and levies,
4. develop flexibility,
5. address infrastructure bottlenecks,
6. create high-quality jobs.

Eurelectric calls on the European Commission to consider the joint recommendations in the upcoming Clean Industrial Deal.

Ruby: Energy intensives should benefit from clear incentives to electrify

According to Eurelectric, in line with Mario Draghi’s report, all Antwerp Dialogue participants recognized the need for the industry to accelerate direct and indirect industrial electrification and reduce the competitiveness gap vis-à-vis trading partners while staying the course to climate neutrality.

“To get the balance between competitiveness and decarbonization right, energy intensives should benefit from clear incentives to electrify,” Eurelectric’s Secretary General Kristian Ruby said. He underlined that a business case for sustained investments in the electricity system is paramount.

Ruby added that a well-functioning market with long-term investment signals, incentives to reinforce infrastructure and lower taxes on electricity are no-regret solutions that can be implemented immediately.