Opinion article by João de Mello, Bondalti's chairman, entitled ‘The decarbonisation of industry and the future of Europe’, published in the January 24, 2025 edition of the Portuguese newspaper "Expresso".
This new year presents Europe with significant opportunities to reassert itself on the global stage, making it imperative to act decisively in the current context. The old-world order is fragile, the new US administration may bring changes, and multilateralism as we once knew it is evolving.
Moreover, the energy transition value chain has come under strong Chinese influence, while high energy prices are straining European competitiveness amid political uncertainty in France and Germany.
To overcome these challenges, Europe will require cooperation between the European Commission, the European Parliament, the European Council, and member states. Strong and coherent policies will be crucial to stimulating the economy by attracting investment for the re-industrialisation of Europe and ensuring its long-term sustainability through transformative investments aligned with the energy transition — one of the strategic priorities identified by Mario Draghi to boost European competitiveness.
In this context, energy-intensive industries (EIIs) will play a pivotal role in meeting decarbonisation targets, which, as Draghi noted, are more ambitious than those set by the US and China. In 2024, over a thousand European organisations and companies from 25 sectors, including industries employing 7.8 million Europeans and generating €549 billion in added value, signed the Antwerp Declaration. Confronted by external pressures and rising production costs, including soaring energy expenses, European multinationals, SMEs, and organisations such as Cefic — the European Chemical Industry Council — underscored the need for Europe to secure its independence and the urgency of implementing a new Industrial Deal to complement the Green Deal. EC President Ursula von der Leyen pledged to present this initiative within the first 100 days of her mandate.
If adopted and implemented effectively, the new industrial policy will undoubtedly be of historic significance.
The energy transition simply cannot occur without decarbonising energy-intensive industries. According to the Draghi report, decarbonising the four largest EIIs will require an investment of €500 billion by 2040. The report advocates for this process to be supported through financing by the EU and member states, recommending an increased allocation of revenue from the EU Emissions Trading System to EIIs, directing funds towards innovation, and enhancing workforce retraining for decarbonisation.
The chemical industry must not be left behind in this transition. As a crucial supplier to other industries and a catalyst for the energy transition itself, its role is indispensable. In Portugal, the chemical sector makes a significant contribution to economic activity, generating €1.6 billion in added value, accounting for 12 per cent of exports, and employing 52,000 people.
I entered 2025 with cautious optimism, buoyed by developments at the end of 2024. The European Commission reached a political agreement on a partnership with Mercosur countries. If ratified, this partnership will establish a free trade area covering approximately 800 million people, granting Europe access to vital materials for the energy transition and key industries such as battery production, photovoltaic panels, and superconductors. On the domestic front, I welcome the announced revision of the status of electro-intensive clients, which aims to enhance competitiveness and better align with European state aid regulations. I also support the revision of PNEC 2030, which establishes ambitious decarbonisation targets.
Achieving a carbon-neutral European economy by 2050, with intermediate targets in 2030 and 2040, depends on productive industries that decarbonise and contribute to Europe's overarching strategy and metrics. While significant progress has been made, I believe Europe requires a new industrial policy that streamlines regulatory processes, reduces bureaucracy, and is developed in close collaboration with member states. Such a policy could play a pivotal role in shaping Europe's future. There are few alternatives: either we summon the courage to choose the right path, or we risk facing the inevitable consequences of decline.
João de Mello, Chairman and CEO of Bondalti, signatory of the Antwerp Declaration
