(Montel) European energy firms are unlikely to immediately move operations to the US to access generous clean tech subsidies there, experts told Montel.
Although the IRA offered strong incentives to speed up efforts in the low-carbon transition, Nguyen said it was too early for European power firms to make a final move to the US.
“Companies need to have a better grasp of what the EU is going to offer: subsidies, red tape, loans, fiscal measures… before making any hastily move,” he said, adding investors wanted predictability in terms of regulation and objectives.
There was a “potentially significant” risk of EU energy firms moving to the US, but this was unlikely to happen in the next couple of years, said Yves Desbazeille, head of nuclear trade body Nucleareurope.
Some US firms were already in contact with European firms to develop small modular reactor (SMR) technologies, for example. Desbazeille did not expect American firms to sign a final contract this year or next.
French firms TotalEnergies and Engie, for instance, could however use a boost from Europe to encourage green hydrogen, as the IRA created a tax credit to incentivise the domestic production of clean hydrogen, said Nguyen.
TotalEnergies intended to take advantage of the IRA to speed up the deployment of its activities in renewable energy, the firm told Montel.
“The IRA offers a lot of assets but so far, little has changed in terms of money actually being granted and the few companies which announced they were going to develop a business overseas might have done it without the IRA,” Nguyen said.
“Let’s see what the EU is able to put forward, and then decide where it is the most valuable to settle for the years to come.”
French tax credit
The European Commission wants the EU to make at least 40% of the strategic net-zero emission technologies it needs by 2030 to support its energy transition and supply security under draft rules proposed in March.
France would introduce a new tax credit this year for investment in green technologies as part of its plans to reindustrialise, president Emmanuel Macron said late on Thursday.
“This financing framework should enable us to compete with the American Inflation Reduction Act,” he added.