As the European Commission announces its Clean Industrial Deal, packaging industry players praise its implications for recycling infrastructure, European preference criteria, and harmonized regulations – yet they warn against preferential funding in the clean tech transition, failing to address regulatory loopholes, and overlooking the role of reuse in optimizing raw materials.
What is the Clean Industrial Deal?
The Clean Industrial Deal encompasses a series of legislative proposals that intend to lower energy prices, create jobs, and establish the necessary conditions to make decarbonization a ‘driver of growth’ for European industries.
It focuses on energy-intensive industries that may need further assistance to decarbonize, transition into clean energy, and tackle roadblocks like high costs, complex regulation, and unfair global competition – this encompasses the steel, metal, and chemicals sectors, among others.
The deal also targets the clean-tech sector due to its role in guiding European industry towards decarbonization, circularity, and improved competitiveness. At the same time, it seeks to promote recycling, reuse, and more sustainable production processes to elongate the life of materials and cut down on waste.
Additionally, it hopes to lessen Europe’s dependence on third-country suppliers when sourcing raw materials, instead maximizing the continent’s own limited resources to ensure a ‘competitive and resilient’ market.
Its many measures include enforcing the Affordable Energy Action Plan, which aspires for efficient energy utilization and reduced dependence on fossil fuel imports; accelerated electrification and the roll-out of clean energy; and the creation of physical interconnections to complete the internal energy market.
Over €100 billion will be mobilized in support of clean manufacturing localized within the EU. State aid to decarbonize industry, roll out renewable energy, and boost Europe’s clean tech manufacturing capacity is set to be approved under a new Clean Industrial Deal State Aid Framework.
The Industrial Decarbonization Accelerator Act will introduce European preference criteria to promote clean products made within the EU in public and private procurements. The Public Procurement Framework will be updated to reflect the same ambitions in 2026.
An Industrial Decarbonization Bank will be proposed; the Innovation Fund is set to be strengthened; and a dedicated call under Horizon Europe hopes to drive innovation and research. Between available funds related to the Innovation Fund, additional revenues from the Emissions Trading System (ETS), and the revision of InvestEU Programme, a target of €100 billion in funding has been set.
The InvestEU Regulation will be amended to boost financial guarantee amounts and help support investments, which is set to mobilize up to €50 billion in clean tech, clean mobility, and waste reduction deployment.
To secure European access to critical raw materials and lessen dependence on external suppliers, the EU will found a mechanism to bring European companies together and aggregate their demand, alongside an EU Critical Raw Material Centre for the joint purchase of raw materials on behalf of interested countries. In theory, this will create economies of scale and give businesses more room to negotiate better prices and conditions.
A Circular Economy Act is also scheduled for 2026; this is designed to unlock efficient use and reuse of scarce materials and drive the circular transition, which is considered essential in the EU’s decarbonization strategy. Its goal is to ensure that 24% of materials are circular by 2030.
A voluntary carbon intensity label will be introduced for industrial products (starting with steel this year, followed by cement) and carbon accounting methodologies will be simplified and harmonized; both measures are set to inform consumers and let manufacturers ‘reap a premium’ on their efforts to decarbonize.
The Carbon Border Adjustment Mechanism, which intends to put a fair price on carbon emitted during carbon-intensive production processes, is also expected to be simplified and strengthened.
Last but not least, the deal is planned to create 500,000 new jobs and must train the EU’s workforce in clean technologies, digitalization, entrepreneurship, and other skills needed in the transition to a low-carbon economy. Steps towards this target include a new Union of Skills and up to €90 million in funding for Erasmus+.
How has the packaging industry responded?
Metal Packaging Europe expresses strong support for the deal, stating that its ambitions are “perfectly aligned with our recently published Call for Actions to support circularity and decarbonization across the metal packaging sector.”
“The Action Plan on Steel and Metals and the Circular Economy Act must fully support the needs of the metal industry,” it says in a statement, “recognizing the value of permanent, truly circular materials like steel and aluminium, which can be recycled again and again without losing their intrinsic properties.
“We encourage the European Commission to prioritize high-quality recycling and acknowledge the unique sustainability credentials of metal packaging in the forthcoming Circular Economy Act.”
The European Paper Packaging Alliance (EPPA) is generally positive – especially its plans to establish Trans-Regional Circularity Hubs, which are intended to improve infrastructure for the collection, sorting, and recycling of fibre-based packaging. Such measures are hoped to improve the recyclability of food packaging materials and reduce contamination risks.
EPPA also anticipates that the deal’s efforts to simplify regulation will help overcome fragmented national regulations and standardize sustainability requirements, helping businesses scale their fibre-based food packaging without violating environmental standards.
“However,” EPPA says in a LinkedIn post, “the impact of these measures will depend on their implementation, which EPPA will closely monitor.”
Similarly, Nicholas Hodac, director general at UNESDA – Soft Drinks Europe, views “the EU’s strong support for recycling and circularity as a great opportunity to continue our sector’s work on closed-loop recycling, which allows us to turn our beverage bottles and cans into new bottles and cans.”
“This strong EU’s focus on recycling and circularity reinforces our view that recycling and reuse are complementary solutions in advancing a circular economy for beverage packaging,” he adds.
The European Container Glass Federation (FEVE) is less optimistic. It describes the deal’s proposals as ‘a step in the right direction’, but fears that certain sectors may be singled out for funding at the expense of container glass.
This industry is a ‘crucial pillar’ of Europe’s economy, FEVE says, citing its applications in food, beverages, pharmaceuticals, perfumes, and cosmetics. Products packaged in glass reportedly accounted for €140 billion and 5.7% of total EU exports in 2023, exceeding the chemicals, aircraft, and mineral fuels industries.
Despite FEVE’s assertion that the container glass industry is already working towards decarbonization, it emphasizes that investment, policy certainty, and access to energy are essential to achieving climate neutrality. It raises concerns that the draft proposals for the State aid reform lack support for operational expenditures, with high electricity costs singled out as ‘one of the main barriers’ to investments in electrification.
It requests that the deal ensure that low-carbon energy carriers are sufficiently available to and affordable for the container glass industry; that the necessary infrastructure is developed to transport and distribute these carriers to container glass plants; that investment cycles for the container glass industry are considered; and that support for capital and operational decarbonization expenditure is increased.
In Cepi’s view, the deal fails to prevent ‘carbon leakage’, wherein industry players avoid environmental regulations by relocating their production processes to countries with less developed climate legislation. The EU’s approach to climate is already driving a ‘mechanical increase’ in CO2 emissions from competitors operating under weaker climate policies, Cepi warns.
However, it praises the deal’s stance that forest-based materials can “reduce dependencies on imported raw materials” and a suitable replacement for imported fossil resources. Chairman Marco Eikelenboom believes that this focus “strengthens Europe’s preparedness for climate change and geopolitical uncertainty.”
“Europe is a lead market for the circular bioeconomy, and there have been recent signs that other parts of the world are looking at our model, with the ambition to catch up,” continues director general Jori Ringman. “The circular bioeconomy is a €7.3 trillion opportunity by 2030. Europe is, after today’s policy announcements, well positioned to capture a large share of this market.”
Opinions differ as to how the deal will affect SMEs. While Cepi expects the deal to save SMEs and mid-caps “billions of euros on regulatory compliance costs without lowering ambition in reducing industrial emissions”, FEVE notes that 98% of the more than 45,000 European manufacturing firms depending on the container glass industry are SMEs – and that inadequate funding will come at their expense.
Caroline Will, communications coordinator at Rethink Plastic, argues that the Commission “completely loses sight of toxic contamination and pollution in the deal”, and that “truly “clean” deal must address the plastics and petrochemical industry, one of the highest emitting and worst-polluting sectors.”
She singles out the petrochemical and plastics industries as the biggest consumers of electricity, even surpassing industries like steel, and suggests that the PFAS, PVC, and other hazardous chemicals used to produce plastics “will cost taxpayers hundreds of billions [of] Euros to clean up.”
She also asserts that the packaging industry is responsible for 40% of all plastics consumed in Europe, much of it for single-use solutions; in her opinion, the EU needs to focus on reducing plastic production and consumption by making better use of finite resources, and should be directing more funding into “tried and tested” reuse systems to prevent waste from being generated in the first place.
Reusable Packaging Europe (RPE) takes a similar stance, praising the deal’s “circularity-first approach” while “highlight[ing] the need for stronger commitments to reuse infrastructure and regulatory protections for reusable assets.”
It adds: “The CID isn’t just about enhancing industrial competitiveness—it’s about rethinking resource use. Reusability must be a top priority to reduce waste, build resilient supply chains, and lower industry’s environmental footprint, in line with the EU waste hierarchy.”
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