WASHINGTON (Reuters) – The European Union wants to reach a deal with the United States soon to resolve a dispute over U.S. electric vehicle tax credits, but the bloc must seek its own green technology subsidies, EU Internal Market Commissioner Thierry Breton said. , to keep domestic investment on Friday.
In Washington to discuss a range of technical issues with U.S. officials, Brittany said the $369 billion worth of tax subsidies in President Joe Biden’s Inflation Reduction Act (IRA) would boost investment in the U.S. clean energy supply chain, From electricity to solar panels and wind turbines to cars.
“We’ve seen the impact: the pull factor for European investment in the United States,” he said in a speech at the Center for Strategic and International Studies. “Now Europe also has to develop its own policy approach to securing its industrial cleantech base.”
Last week, European Commission President Ursula von der Leyen announced plans for a Net Zero Industry Act, an EU cleantech subsidy to encourage investment.
Breton said EU law would “take inspiration” from IRA law but “not emulate all its elements” as it would be more transparent and would seek to avoid competition and discriminatory practices.
Breton later admitted to reporters that the U.S. Congress is now divided, with the Republicans controlling the House of Representatives and Biden’s Democrats controlling the Senate, and will not change U.S. law because it is important to the Biden administration.
That could help revive some parts of the U.S. that have suffered from factory closures in the past, Breton said.
“We now need to find our own answers for the cleantech industry,” Breton said, comparing the work to the EU’s 45 billion-euro semiconductor investment law aimed at building chip-making capacity.
The EU chip bill also offsets the $52 billion U.S. semiconductor production and research bill that Biden signed into law last year.
However, Breton said he was encouraged by the formation of a U.S.-EU task force to try to resolve a dispute over a $7,500 U.S. EV tax credit that applies only to North American-assembled vehicles that comply with regional battery content rules. A solution needs to be found to make EU vehicles eligible for points, Breton said.
(Reporting by David Lawder; Editing by Grant McCool)