The EU has unveiled two draft laws in response to the US Inflation Reduction Act that might lure European clean-tech companies across the Atlantic by offering significant financial invectives for US produced products.

The proposed Critical Raw Materials Act will help the EU secure supply of the metals needed to build batteries, wind turbines and other green technologies, whilst the draft Net Zero Industrial Act is designed to ensure that the technologies needed to transition the EU’s economy to net-zero emissions are domestically made.

By 2030 the EU should be able to process at least 40 per cent of ‘strategic’ metals required, according to the draft Critical Raw Materials Act, and a target to obtain 15 per cent of metals from recycling will help to scale up capacity to capture scrap from battery factories and end-of-life products.

Julia Poliscanova, senior director for vehicles and emobility at T&E, said: “Lithium is the new oil and Europe needs to act quickly to source it responsibly. Provided that environmental safeguards are respected, self-sufficiency targets are the right way to make the battery supply chain clean and resilient.”

But even as the EU moves to counter the US Act, cracks are appearing in any form of joined-up plan, with the German car industry reluctant to invest in change. T&E also believes that sending a clear signal that the future of the automotive industry is electric is the best tool to ensure investment certainty, and the EU’s response to US subsidies is being undermined by Germany’s blockade of a 2035 phase-out for combustion engines.

Share Story: