Brussels, 29 January 2025 – The European Commission announced its Competitiveness Compass, setting a political direction for addressing Europe’s competitiveness gap. Climate Action Network (CAN) Europe regrets that the Commission takes a dangerous misstep by framing regulation as one of the primary obstacles to competitiveness. It is not the rules that protect people, climate and the environment that are holding companies back, but rather the lack of investment and high energy prices driven by the EU’s fossil gas dependency.
The Compass echoes the goal of achieving climate neutrality but fails to draw a clear course towards an industrial policy that accelerates the transition to a net-zero economy and a fully renewable energy system, the real drivers for competitiveness.
Greg Van Elsen, Policy Lead on Clean Industrial Deal at CAN Europe, said:
“A compass is only useful if it is calibrated and points to the right destination. It is a fact that Europe urgently needs an industrial transformation that builds future-proof industries within planetary boundaries. This requires a coordinated industrial strategy at the EU level. The Competitiveness Compass recognises the problem—fragmented national policies—but fails to provide an ambitious, coordinated and sustainable solution. If the EU wants to lead in the net-zero economy, it must recalibrate and back its progressive industries, including grid manufacturers, battery producers, and green steel, with a clear plan: joint investment, smart regulation, energy transition and strong climate targets. A blind deregulatory drive won’t get us there.”
On the environmental and social conditions for public funds and corporate accountability, Isabelle Brachet, Fiscal Reform Policy Coordinator at CAN Europe, said:
“The EU and member states cannot be handing out public money to companies that make profits without giving anything in return. Accessing public funds must go with the responsibility to generate positive outcomes for the climate, the environment, workers and society at large. On top of that, the upcoming Omnibus legislation attacking corporate accountability is just unacceptable. We must not allow the simplification agenda to translate into cutting down the social and environmental legislation, which is unfairly blamed as a blocker to European competitiveness.”
On the climate ambition and EU’s climate targets, Sven Harmeling, Head of Climate at CAN Europe, said:
“We acknowledge that the Commission’s Compass includes the proposed 2040 target and decarbonisation as an economic driver, even though the EU should go further and aim for climate neutrality by 2040. We welcome the amendment of the European Climate Law in the list of flagship actions. However, submitting a new national climate plan (NDC) under the Paris Agreement is absent. Including this would be crucial for building trust with external partners and demonstrating that the EU views climate action as a cornerstone of its competitiveness.”
On energy prices and the renewable energy transition, Cornelia Maarfield, Head of Energy at CAN Europe, said:
“The EU must lower energy prices and improve affordability for both industry and households. While we welcome the Commission’s renewed commitment to building out clean energy infrastructure like grids and storage, the Compass falls short on phasing out all fossil fuels — whether from Russia or elsewhere — and fully utilising energy savings, the two missing elements of an affordable, resilient energy system.
This isn’t just about cheap energy. Industry must reduce its energy demand through electrification, circular product design and energy efficiency. The Action Plan for Affordable Energy Prices must ensure that households benefit equally from affordable renewable energy, without shifting the costs onto them to favour industry.”
For more information or questions, please contact:
Jani Savolainen, Communications Coordinator, jani.savolainen@caneurope.org / +358 504667831
