Europe – The EU Parliament has adopted the EU’s Strategic Technologies for Europe Platform (STEP) – a stripped-down version of the previously touted European Sovereignty Fund – as part of the bloc’s response to the US Inflation Reduction Act (IRA).
Lawmakers called on the EU to bolster the additional funds available to the total of €13 billion in support of green projects. While this falls short of the more than €300 billion available for US businesses, Transport & Environment (T&E) has called on national governments to back the STEP and to commit themselves to fresh funds.
So far, subsidies for green manufacturing have come at the national level with little strings attached. This has created a two-tier Europe, which has divided France and Germany from the rest. STEP addresses this by providing additional financial firepower to programmes across Europe; the Innovation Fund and the InvestEU.
Green transition
However, aside from the sums being too small, the package lacks focus. The inclusion of biotech and digital technologies’ will stretch the funds too thin, says T&E. The limited funds should be spent on accelerating Europe’s green transition, notably on critical minerals supply chains and batteries, says the group.
STEP has the potential to make a significant impact on the EU’s green transition. By providing financial support to green projects, STEP can help to accelerate the development and deployment of new green technologies. This can help to reduce the EU’s reliance on fossil fuels and support the transition to a clean energy future.
However, STEP’s impact will depend on the amount of funding that is available. The €13 billion that is currently on the table is not enough to compete with the US IRA. If the EU wants to remain competitive in the global cleantech race, it will need to provide more funding for STEP.
