The Net-Zero Industry Act – New Implementing Rules to Accelerate Clean Technology Manufacturing in the EU

Introduction

On 23 May 2025, the European Commission adopted a significant package of secondary legislation to support the implementation of the Net-Zero Industry Act (NZIA),[1] marking a crucial step in the EU's industrial decarbonisation agenda. The new measures will:

• Define in more detail what technologies and components are intended to be covered by the Net-Zero Industry Act,
• Introduce non price related criteria to be used by Member States when awarding a percentage of their renewable energy projects from 30^th December 2025. The aim is to boost demand for EU-made net-zero ESG friendly technologies and level the playing field against subsidised imports, and
• Set out detailed guidelines for selecting projects eligible for "strategic project" status under Article 13 of the NZIA.

Firms interested in benefitting from the NZIA framework should now consider:

• Whether their technologies or components fall within the updated scope;
• How to incorporate non-price criteria in procurement strategies;
• The feasibility of applying for strategic project status under the new selection guidelines.

Background

The NZIA, adopted in June 2024, is a cornerstone of the EU’s Green Deal Industrial Plan. Its purpose is to scale up the manufacturing of key net-zero technologies in the EU. These include solar PV, wind energy (offshore and onshore), batteries, heat pumps, electrolysers, grid components and carbon capture, utilisation and storage (CCUS).

The Act sets the ambitious goal of producing at least 40% of the EU’s annual deployment needs for strategic net-zero technologies domestically by 2030 and aims for a 15% global share in net-zero tech manufacturing by 2040. Through fast-tracked permitting, incentives, and strategic project status, the NZIA seeks to reduce the EU’s dependence on third countries, diversify supply chains, and boost clean energy jobs and competitiveness.

New secondary legislation – key measures adopted on 23 May 2025

1. Scope of NZIA – list of main components and final products:

The Commission adopted two acts that further define the scope of the NZIA:

• A delegated act, containing a list of specific components primarily used in net-zero technology manufacturing (e.g. solar wafers, wind turbine blades, battery cells).
• An implementing act, containing a list of final net-zero technology products and their main components subject to the NZIA (e.g. solar panels, wind turbines, electrolysers).

These will serve as the basis for applying the "resilience" criteria under Articles 25 to 28 of the NZIA in public procurement, renewable energy auctions, and other public interventions. Under the NZIA, where the EU is excessively dependent on a single source of supply for a clean technology or component which is on these lists, contracting authorities must now consider supply chain resilience – rather than price alone. This means that suppliers offering diversified or EU-based supply chains could be favoured over lower-cost but high-dependency alternatives.

The updated lists are also relevant for determining which activities or supply chains fall within the scope of NZIA benefits – including eligibility for strategic status, priority permitting, or access to financial instruments.

2. Guidelines on non-price criteria in renewable energy auctions:

Under a new implementing act, from 30 December 2025 Member States must apply non-price criteria to at least 30% of their annual renewable energy auction volumes or alternatively to at least 6 GW per year. The applicable non-price criteria include:

• Responsible business conduct (e.g. ESG standards);
• Cybersecurity requirements;
• Contribution to environmental sustainability and supply chain resilience.

The act provides concrete parameters to harmonise how Member States design these criteria while leaving flexibility for national implementation.

3. Criteria for strategic projects selection:

The Commission also adopted an implementing act providing detailed guidelines for selecting projects eligible for "strategic project" status under Article 13 of the NZIA. Strategic project status grants national-level priority treatment, including faster permitting and access to financial and advisory support.

The new act elaborates on:

• First-of-a-kind manufacturing facilities: Projects must offer innovative manufacturing processes not yet substantively present or planned in the EU. Minor improvements are not sufficient.
• Best available technology: Refers to the most effective and advanced manufacturing practices available under economically and technically viable conditions, based on benchmarks and performance classes.
• Significant manufacturing capacity: The project must meet one of several thresholds, such as:
  • 1 GW or more of annual capacity;
  • Among top 10 comparable EU projects;
  • Vertically integrated output;
  • Contributing to closing the gap on the EU’s 40% benchmark.
• Environmental sustainability: Projects must significantly and permanently reduce CO₂-equivalent emissions, taking into account wider environmental benefits and avoiding emissions shifting.
• Import dependency: Projects may qualify if they reduce EU reliance on third-country imports for specific net-zero technologies, based on the >50% import threshold.
• Significant global share: The project must aim to achieve >15% of global production capacity for the relevant technology or component.

The implementing decision also encourages Member States to use the standardised application process on the Commission website and designates national contact points to streamline the assessment.

4. Communication on shares of EU supply:

The Commission also issued a Communication mapping the EU’s current supply landscape for key net-zero technologies and their components. It highlights third-country dependencies and aims to enable Member States to apply the resilience criteria more effectively and to justify the designation of certain technologies as strategic.

What this means for Industry and Member States

The adoption of these acts marks a decisive step in implementing the NZIA. By formalising selection and award criteria, the rules will streamline permitting, increase legal certainty, and reward projects that contribute to strategic autonomy, innovation, and sustainability.

As competition for net-zero investments intensifies globally, the NZIA's effective implementation will be key to ensuring the EU remains a hub for clean energy manufacturing.

Next Steps and Outlook

While the delegated and implementing acts supporting the NZIA have now been adopted, their implementation is at different stages. The delegated act is subject to a two-month scrutiny period by the European Parliament and Council – extendable by another two months if requested. During this period, the institutions may object to the delegated act before it formally enters into force. By contrast, the implementing acts adopted by the Commission are not subject to such scrutiny and will enter into force directly after their publication in the Official Journal.

Looking ahead, the Commission is simultaneously progressing with additional legislative initiatives under the umbrella of its Clean Industrial Deal (see our article here). This includes the Industrial Decarbonisation Accelerator Act, currently open for public consultation, which aims to provide faster permitting and support for energy-intensive industries to decarbonise competitively.

Stakeholders should continue to monitor these developments closely, engage with national authorities on project recognition and procurement procedures, and assess how their manufacturing capacity and supply chain structure align with the NZIA framework.

For more information or tailored advice on how to navigate the NZIA and related frameworks, please feel free to get in touch