The European Commission launches Action Plan for the chemical industry
The European Commission has unveiled an ambitious Action Plan for the Chemicals Industry, aiming to bolster the sector's resilience, sustainability, and competitiveness. According to the Commission, this plan is designed to address the significant challenges faced by the European chemical industry, including high energy costs, global competition, and the urgent need for decarbonization. At Catalisti, we recognize the pivotal role of innovation and sustainability in this transformation and are committed to supporting these initiatives.
According to the Commission, the Action Plan is built on four key pillars: strengthening resilience and global trade, securing energy and supporting decarbonization, creating lead markets and boosting innovation, and simplifying regulations. The Commission intends to establish a Critical Chemicals Alliance to identify key assets, align investments, and coordinate support mechanisms such as funding and Important Projects of Common European Interest (IPCEIs). This initiative is expected to save the EU chemical industry at least €363 million annually by cutting costs and reducing red tape.
Innovation and sustainability
Innovation is at the heart of the Commission's strategy to ensure the long-term competitiveness of the European chemical industry. The Commission plans to create EU Innovation and Substitution Hubs to accelerate the development of safer and more sustainable chemical solutions. These hubs will provide technical guidance, foster partnerships, and share knowledge, particularly benefiting SMEs.
Chemical recycling
The Commission also emphasizes the importance of transitioning to a circular economy and reducing dependencies on fossil-based feedstocks. According to the Commission, chemical recycling will play a crucial role in reducing the EU's dependence on virgin, fossil-based resources for plastic production. The Commission intends to launch a public consultation on an implementing act under the Single-Use Plastics Directive to establish a clear framework for mass balance allocation, thereby promoting chemical recycling.
Renewable carbon
The Commission's Action Plan highlights the need for a progressive shift towards alternative clean carbon sources such as biomass, recycled waste, and carbon from carbon capture and utilization (CCU). The Commission plans to incentivize the supply and market uptake of these clean carbon sources to defossilize chemical products.
The upcoming Bioeconomy Strategy, scheduled for Q4 2025, aims to improve resource efficiency and tap the growth potential of bio-based materials. This strategy will define a vision for scaling up the manufacturing of sustainable bio-based materials, develop biotechnologies, and promote innovation and investments in high-value applications, including chemicals.
Supporting decarbonization
The Commission intends to support the chemical industry's decarbonization efforts through various financial instruments. The Horizon Europe work program for 2026-2027 will allocate approximately €370 million to support industrial decarbonization at earlier innovation stages. Additionally, a flagship Horizon Europe call of €600 million will be launched to support fit-for-deployment projects, fostering synergies between research and investment.
The Innovation Fund, set up by the EU Emissions Trading System (ETS), will provide incentives for industrial decarbonization. The Commission plans to propose an Industrial Decarbonization Bank, aiming to provide up to €100 billion of funding for industrial decarbonization. A pilot for this bank will be launched in 2025 with a €1 billion auction for the decarbonization of key industrial processes.
Catalisti helps
According to the Commission, the successful implementation of this Action Plan will require a concerted effort from all stakeholders, including the European Institutions, Member States, industry, and civil society. The Commission is committed to working closely with all stakeholders to ensure that the objectives of the Action Plan are achieved.
At Catalisti we believe that innovation and sustainability are key to the future of the European chemical industry. We are committed to support companies that want to take part in the Commission's funding initiatives and thus contributing to a more competitive, resilient, and sustainable chemical sector in Europe.