FEAD position on the Industrial Accelerator Act

FEAD, the European Waste Management Association, representing the private waste and resource management industry across Europe, welcomes the initiative to strengthen the European manufacturing industry. However, the focus of the Industrial Accelerator Act remains on primary production industries, not considering recycled materials as equals. This sends a regrettable signal and must be complemented by a clear commitment of equivalent ambition to strengthen the waste management and recycling infrastructure through the Circular Economy Act (CEA). At the same time, the benefits in terms of decarbonisation and resilience linked to the uptake of recovered materials and energy from waste should be more strongly recognised by reinforcing and extending the scope of the strategic sectors and the low-carbon and Union origin requirements (Annexes I & II IAA).

FEAD puts the following proposals forward:

1. Extend the scope of strategic sectors for industrial manufacturing acceleration areas under Annex I to include waste management and recycling activities (NACE 38.2), which play a strategic role in supplying recovered materials to European industry, contribution to the strengthening of the EU’s manufacturing base and resilience.

2. Safeguard the Union origin criteria and the understanding of ‘equivalence’. The extension proposed to third countries with which a trade agreement is in place implies a significant weakening of the Union origin concept. It offers little visibility on its practical implications, little prospects for having an impact on local demand creation to foster industrial capacity, circular value chains and security of supply in Europe, and no guarantee of equivalence in terms of ambitions and environmental and social standards. FEAD strongly rejects such broad extension. Regarding recycled materials, strict European origin for EU/EFTA/UK countries is indispensable to safeguard Europe’s recycling infrastructure. While such strict approach may not be suitable for other sectors, the requirement must still entail an actual requirement of equivalence in terms of overall standards. FEAD therefore proposes the following:

• Regarding recycled materials, a strict interpretation of the ‘Union origin’ must be maintained. Additionally, the IAA could mandate an assessment to determine for which additional sectors, beyond recycling, strict European origin (EU/EFTA/UK) brings strategic added value and also maintain a strict interpretation of the ‘Union origin’ requirement for those.
• For the remining sectors, the scope can be extended to third countries under equivalence considerations with a clear reference to environmental and social standards to safeguard the competitiveness of the EU’s industries.

3. Ensure low-carbon criteria support recovery and recycling operations. The reference to low-carbon criteria in public procurement and other forms of public interventions is welcome as a way to move procurement decisions beyond lowest price alone and better reward real environment performance. However, such criteria shall be clarified to incorporate clear safeguards to ensure recycled content is fully and transparently reflected in the low-carbon definition. For metals, this should ensure that any methodology used appropriately rewards the use of metal scrap, including steel and aluminium recovered from incineration bottom ashes, avoiding situations where primary production routes are overvalued relative to their circular material inputs (e.g.: avoid the use of the ‘sliding scale’ method in the steel sector). When defining ‘green steel’ and corresponding criteria for other product groups, within the class of ‘green’ products, further subdivisions should be implemented to really reward ‘front-runners’ for decarbonisation.

4. Extend Annex II, low-carbon and Union origin requirements to plastic, minerals, rubber, glass. For plastics, low-carbon criteria should entail mandating minimum recycled content requirements in relevant publicly funded applications. Especially since plastics are considered a strategic sector, it would have been appropriate to maintain their full and explicit inclusion in the text, as was the case in the previous version (18th February). At a time when the sector is facing significant challenges, the introduction of ‘Made in Europe’ requirements would represent a meaningful support lever. For minerals, the recovery of the mineral fraction from the treatment of bottom ash resulting from the incineration of non-hazardous municipal waste should be recognised as part of low-carbon criteria, insofar as it replaces natural aggregates (such as sand and gravel) or conventional building materials, the extraction, crushing and transport of which generate CO₂ emissions.

5. Extend ‘Union origin’ provisions to steel. While such provisions are foreseen for aluminium, concrete and mortar, this should also be extended to steel, or at least to the steel scrap content.

6. Extend Annex III on ‘Union origin’ requirements for vehicles to low-carbon requirements. The proposal to introduce ‘Union origin’ requirements for electric vehicles and key components in public procurement and public support schemes, in particular the inclusion of requirements on battery value chain components such as cathode active material made in Europe, is welcome. This is an important step towards closing persistent gaps in the European battery ecosystem. While recycling capacity is emerging in Europe, key downstream refining and processing stages remain insufficiently developed, meaning that materials recovered in Europe may still need to be processed outside the continent. Strengthening demand for European battery components is therefore essential to building a more complete and resilient value chain. At the same time, the framework should go further. Public support for the purchase, leasing or rental of vehicles should not focus only on origin requirements for selected components. It should also promote low-carbon requirements for vehicles and the use of recycled materials sourced within the European industrial sphere, especially recycled plastics. Public support should help drive both industrial localisation and circularity in the automotive value chain.

7. Extend empowerment for laying down demand-side measures to the use, production and sale of European sustainable carbon sources in relevant sectors where carbon constitutes a significant feedstock input. Creating predictable demand for these inputs is important to scale circular carbon value chains and reduce reliance on fossil-based feedstocks in sectors such as chemicals, fuels and certain industrial materials.

8. Subject industrial acceleration areas to real resource resilience. The provision under Art. 25(4)(d)m according to which Member States shall take into account the feasibility of connecting industrial acceleration areas with sufficient low-carbon energy supply, should also cover to all sources of waste heat, including waste heat and process steam from waste-to-energy plants. It should facilitate connections with existing infrastructure and remain consistent with the Union’s broader heating and cooling policy framework. This is important both for industrial decarbonisation and for reducing dependence on imported fossil energy.

9. Recognise energy as a strategic industrial factor and enable waste-based energy solutions. Introduce an explicit acknowledgment that energy should be considered not merely as a commodity, but as a key factor of industrial competitiveness, resilience and security. In this context, the Industrial Accelerator Act should ensure the simplification and significant reduction of permitting timelines for industrial projects across all sectors, including waste management, recycling and recovery activities, where such projects aim at the use of their unavoidable production residues for energy production and consumption. These projects should be considered strategic and not be limited to hard to abate industries only, as they contribute horizontally to:

a) industrial decarbonisation,

b) energy system resilience,

c) reduced dependency on external energy sources,

and therefore, fully support the objectives of the IAA regardless of the specific industrial sector involved. This approach would effectively promote local, programmable and low carbon energy solutions, including energy and heat recovered from waste and deeper integration between industry and energy (self-)production systems and circular use of industrial and waste-derived residual streams.

10. Welcome the removal of export restriction provisions and ensure they are not reintroduced. The final text of the IAA no longer contains the provisions that would have allowed the introduction of restrictions on the export of recycled materials. This is a positive development, as markets for recycled metals and secondary materials are deeply integrated at the international level. Export restrictions would have disrupted market equilibrium and undermined the economic viability of European recycling operations. FEAD call on the co-legislators to ensure this outcome is preserved throughout the institutional negotiations and that no comparable mechanism is reintroduced through delegated acts or other legislative vehicles.

[1] https://www.eca.europa.eu/en/publications?ref=sr-2023-28

FEAD, the European Waste Management Association, represents the entire waste management value chain, from collection and sorting to recycling, energy recovery, and final disposal. It brings together the private waste and resource management industry across Europe through its 21 national member associations and associate members, which collectively represent over 3,000 companies. Together, the sector provides more than 500,000 local jobs and fuels €5 billion in investments into the economy every year. For more information, please contact: info@fead.be