Draghi report urges joint decarbonisation and competitiveness plan

In a reaction to Mario Draghi’s report on EU competitiveness on Monday, SolarPower Europe’s CEO Walburga Hemetsberger welcomed the report’s recognition of the link between decarbonisation and competitiveness.

"It’s good news for solar and renewables that today’s report recognises the importance of decarbonisation and competitiveness, and underlines how mutually reinforcing they are,” she said, adding that the best option for EU competitiveness remains flexible, renewable-based electrification.

Hemetsberger further said that the solar sector is relieved by the report’s acknowledgment of the role of long-term contracts, like power purchase agreements (PPAs) and contracts for difference (CfDs), and stated that to structurally lower costs, the way forward is based on clean flexibility and smart electrification.

The organisation calls for adopting an Electrification Action Plan, which goes beyond electrifying transport. “As the report highlights, some of Europe’s energy-intensive industries will need support during this transition period. Any support should ultimately be conditional on electrification and the progress of clean flexibility,” Hemetsberger said.

According to the SolarPower Europe CEO, it is important not to give up on strengthening the EU solar supply chain. While the EU Net-Zero Industry Act is expected to help drive demand for EU solar products, more support is needed for the initial scale-up for factories, she said. “There, we are lacking an EU financial instrument dedicated to EU solar manufacturing – comparable to the support received by other sectors, like wind, batteries and hydrogen," Hemetsberger added.

Giles Dickson, CEO WindEurope, meanwhile, praised Draghi’s clear-sighted report. “The big picture is spot on - the energy transition needs a step-change in grids, permitting, finance, supply chains, level playing field and innovation. And the detail is admirable - piercing diagnosis of problems and clear recommendations to sort them,” Dickson wrote on social media.

Mario Draghi, former European Central Bank president and Italian prime minister, was asked by the European Commission to prepare a report on the future of European competitiveness. The work will help the Commission develop a new plan for Europe’s competitiveness, including a new Clean Industrial Deal.

The report identifies three key areas for action to reignite sustainable growth, one of which is a joint plan for decarbonisation and competitiveness.

“If Europe’s ambitious climate targets are matched by a coherent plan to achieve them, decarbonisation will be an opportunity for Europe. But if we fail to coordinate our policies, there is a risk that decarbonisation could run contrary to competitiveness and growth,” the report says.

The other two areas are focusing on closing the innovation gap with the US and China, and increasing security and reducing dependencies.

According to the analysis, to meet the report’s objectives, an additional investment of at least EUR 750 billion (USD 828bn) to EUR 800 billion a year will be needed.

(EUR 1 = USD 1.104)

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