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Today, the European Parliament adopted the Net-Zero Industry Act (NZIA), which is a regulation for mandatory non-price resilience and sustainability criteria to be applied in public procurements, auctions, and other forms of public intervention for net-zero products.

ESMC welcomes the NZIA as one of the first EU-wide mandatory legislative initiatives towards reaching the targeted manufacturing capacity to cover 40% of EU’s deployment of strategic technology products, such as solar PV modules, wind turbines, batteries and heat pumps.

“We welcome the resilience and sustainability criteria in the adopted Net-Zero Industry Act. This gives a green light for procurement of sustainable European made solar panels and is clear direction towards resilient supply. We urge the Member States to start buying as from now, and not waiting for the time thresholds in the regulation, says Žygimantas Vaičiūnas, Policy director at European Solar Manufacturing Council.

“Our European solar PV manufacturers are ready to supply European buyers with top quality and the most sustainable European made solar panels”, he adds.

ESMC would like to stress the importance of this possibility as it allows the Member States to apply the provisions of NZIA beforehand as outlined in the European Solar Charter, signed on 15th April and supported by the majority of the EU Member States.

The provisions of the NZIA states certain non-pricing (resilience and sustainability) criteria and tolerance of price difference for public procurements. Additionally, there are concrete pre-qualification criteria to be applied in public procurements of environmental sustainability and resilience once more than 50% of the EU’s supply from a single source of supply is identified. There are also three selective criteria, of which at least one must be chosen: (1) social or employment-related considerations; (2) cybersecurity requirements; (3) delivery on time. Concerning the cost difference, up to 20%, based on objective and transparent data, will be presumed proportionate.

Similar resilience, sustainability and other criteria applies to auctions, where up to 15% price difference will be presumed proportionate.

ESMC welcomes the introduction of non-price criteria dedicated to ensuring resilient and sustainable net-zero production manufacturing in the EU, including solar PV. However, the application of the provisions would give the real effect only in 2026 and to a limited part of the European PV market as public procurements and auctions comprises only relatively small part of all PV deployments in the EU. Accordingly, most of the effect of the application of the NZIA provisions will depend on its earlier implementation and broader scope of application — extending beyond public procurements and auctions.

The NZIA was adopted today in the European Parliament with 361 votes in favour, 121 votes against, and 45 abstentions. Following European Parliament decision today, the NZIA should be adopted by the Council and then will be published in Official Journal, expecting to entry into force by June 2024. The next important step will be the adoption of the Implementing Act by the European Commission, which should happen not later than within nine months after NZIA enforcement, specifying the criteria to assess the sustainability and resilience contribution.

Image copyright: VOLTEC Solar

Žygimantas Vaičiūnas
ESMC Policy Director

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