WindEurope is calling on Members of the European Parliament (MEPs) to endorse Europe's climate and energy security objectives, particularly in the Committee on Industry, Research, and Energy (ITRE). This appeal coincides with the Parliament's crucial vote on its stance for negotiations with the European Commission and Member States regarding the Net-Zero Industry Act (NZIA).
Despite Europe boasting a world-class wind industry, WindEurope notes that challenges persist within its supply chain. Factors such as inflationary pressures, uncertainty regarding wind expansion volumes, and suboptimal auction design have collectively hindered the industry's ability to plan and invest in new manufacturing sites. These obstacles jeopardize the EU's energy security and climate targets.
The European Commission introduced the NZIA earlier this year, emphasizing the importance of strengthening and expanding European clean tech manufacturing. Commission President Ursula von der Leyen affirmed the EU's commitment to producing clean tech within Europe in her State of the Union Speech, stating, “the future of our clean tech industry has to be made in Europe.”
Pierre Tardieu, Chief Policy Officer at WindEurope, highlighted the significance of tangible measures to boost the European wind supply chain. Proposed measures include indexing auction tariffs to reflect higher input costs, ensuring fair competition in the European market, and pushing against ‘race to the bottom' auctions.
Tardieu stated, “This is the right course of action. It's a matter of security, jobs, and autonomy.” The ITRE position, under consideration, introduces crucial changes to wind energy auction design. It includes clear and mandatory prequalification criteria for tenders, incorporating rules for cybersecurity and data residency to safeguard Europe's critical energy and grid infrastructure from cyberattacks.
The ITRE Committee also proposes an inflation indexation mechanism, addressing a current challenge faced by wind developers. Inadequate indexation has led to the cancellation of large offshore wind projects, jeopardizing economic viability. The mechanism aims to bridge financial gaps by reflecting input costs in wind energy auctions for the duration of supplier contract negotiations.
Additionally, the ITRE Committee advocates for an end to the use of negative bidding in auctions, a practice where wind farm developers pay governments for the right to build. WindEurope argues that this approach creates additional costs for developers, ultimately impacting the supply chain and consumers.
The outcome of the Parliament's vote on the NZIA position will significantly influence the trajectory of the European wind industry and its role in advancing the region's clean energy transition.