The transition to a clean and competitive industrial base is crucial to strengthening Europe’s resilience and strategic economic independence. The Clean Industrial Transition Monitor by ECNO assesses real-world progress using more than 50 indicators and provides a comprehensive and nuanced picture of both progress and remaining gaps.

Uneven progress and persistent bottlenecks

While progress is visible across several key enabling conditions, the transition remains uneven. Key challenges include weak demand for clean products and materials, infrastructure bottlenecks, limited financing, and difficulties in diversifying the supply of critical raw materials. Addressing these barriers will require targeted and sustained policy action.

At the same time, the Clean Industrial Deal already provides a broad and comprehensive policy framework. The report assesses more than 80 initiatives, which together cover most of the key drivers of industrial transformation. However, their impact will depend on how quickly, coherently and effectively they are implemented.

Demand, carbon pricing and key policy levers

A notable shift in the policy landscape is the growing focus on demand-side measures. Initiatives such as the Industrial Accelerator Act and the Public Procurement Act aim to create lead markets for clean technologies and materials. Establishing reliable and predictable demand will be essential to unlock investment and scale low-carbon production across Europe.

At the core of the transition remains the EU Emissions Trading System (ETS). As the central economic signal, it helps internalise and reduce the cost gap between fossil-based and low-carbon production while also generating revenues for industrial decarbonisation. Maintaining a stable and robust carbon price is therefore essential for investment certainty and long-term planning.

Additional decisive initiatives under the Clean Industrial Deal are the Grids Package, the Clean Industrial State Aid Framework, and the forthcoming Circular Economy Act. Together, they act as key cross-cutting levers across multiple areas—from infrastructure and financing to resource use.

Financing, resilience and the global dimension 

Ensuring sufficient and sustained financing will be key to maintaining momentum. While current EU instruments have already contributed to positive trends in investment and employment, additional and better-targeted funding will be needed to support deep structural transformation across regions.

At the same time, accelerating electrification and renewable energy deployment will strengthen Europe’s economic resilience by permanently reducing dependence on imported fossil fuels. Finally, the success of the transition will also depend on its global dimension. By maintaining a clear and consistent policy direction and building strategic partnerships, the EU can strengthen its competitiveness and actively shape emerging global markets for clean industrial products.