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Exploring Options to Strengthen the Multi-Level Governance Framework for the Decarbonisation of Energy-Intensive Industries in Europe

European Union
Governance
Climate Change
Energy Policy
Member States
Simon Otto
Vrije Universiteit Brussel
Simon Otto
Vrije Universiteit Brussel

Abstract

European energy-intensive industries (EIIs) face the dual challenge of decarbonising while maintaining international competitiveness. On the one hand, the European Union’s (EU) climate targets require that EIIs reach close to zero emissions before 2050, which is possible but requires a far-reaching transformation of these industries. On the other hand, due to high international competition, overproduction and high energy prices, European EIIs face severe economic pressures and competitiveness concerns, which threaten the existence of EIIs in Europe and undermine their decarbonisation. Addressing this dual challenge will require a comprehensive, coherent and coordinated industrial strategy and multi-level governance framework across Europe. However, the development thereof has been constrained by limited EU-level competencies regarding industrial policies and constraints of member state industrial policy under EU competition law. As a result, existing industrial strategies and policies for decarbonisation remain fragmented and incoherent across Europe. Against this backdrop, this paper will explore how the governance framework for decarbonising EIIs in the EU can be strengthened. To that end, this paper will analyse the existing multi-level governance framework of EII decarbonisation across the EU and member state level (taking Germany and Spain as examples), based on relevant policy documents, academic literature, and expert interviews. This allows to identify gaps and challenges across the existing governance framework for EII decarbonisation and to discuss potential options to address these shortcomings. The findings of the paper will contribute to the development of a more effective governance framework for EII decarbonisation and advance the academic discussions on EU industrial policy and climate governance.