Clean Industrial Deal: What Impact Will It Have on European Clean Tech and Transition Industries?

An Analysis of the Clean Industrial Deal

Part 2: Clean Tech and Transition Industries

The signals sent by Europe provide key players in the transition with the clarity they need to plan their strategies. In this respect, the Clean Industrial Deal builds on the 2019 European Green Deal and also marks a turning point in Europe’s vision of sustainability.

Following the Draghi report, the European Commission released this set of measures, known as the “Clean Industrial Deal,” in February 2025 to support the environmental transition of industrial companies, turn this transition into a source of competitiveness, and enable new industries to establish a sustainable presence across Europe.

Indeed, supporting decarbonization initiatives across Europe has long been a priority. In 2021, a vast portion of the photovoltaic panel production value chain is located in China: 75% of photovoltaic module production, 75% of cell production, 97% of wafer production, and 79% of polysilicon production. China’s near-monopoly on this essential component of the energy transition means that decarbonizing the electricity sector creates a de facto dependence on China. Similarly, the battery ecosystem—particularly in the areas of cathode precursors and downstream recycling—is currently highly dependent on China. Companies in the decarbonization and “cleantech” sectors are currently facing significant difficulties in establishing themselves in Europe. They are hindered in this by several factors:

• First, these companies operate in emerging markets, which are to challenge activities that rely on fossil fuels—activities that are well-established and difficult to challenge.
• Second, these emerging markets are highly dependent on the infrastructure that underpins them, but which The installation requires time and political decisions. This is the case for new energy sectors that depend on the availability of local green electricity infrastructure, such as hydrogen.
• Third, in these emerging markets, the economic equation for a new European entrant is difficult, and the Price competitiveness is low compared to foreign competitors that have been established for a long time and have already realized all their economies of scale.
• Finally, the inability to establish a genuine competitive advantage, given that the merits of the processes used by European players are often not adequately taken into account by regulators, and therefore impossible to communicate to potential customers. The case of graphite, discussed in this article and an important component of lithium-ion batteries, is a good example of a material whose carbon footprint can be significantly lower if produced in France.

The Clean Industrial Deal offers some initial answers to all these questions.

These measures, which will be published between 2025 and Q4 2026, are detailed in the following article, which focuses on new decarbonization pathways and follows up on this article, dedicated to energy-intensive industries.