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Objectives and methodology

Context

Rising to the eco-innovation challenge

Rising demand for a better environment has led to an expanding supply of environmentally friendly techniques, products and services in both the industrialised and developing countries. Europe’s first major drive to boost eco-innovation came with the Environmental Technologies Action Plan (ETAP). Adopted in 2004, this Action Plan focused on the further development and use of environmental technologies. Its goal was to tackle the financial, economic and institutional barriers hindering growth of these technologies, as well as to encourage their adoption by the market.

Under ETAP, Europe’s eco-industries have flourished. This sector today has an estimated annual turnover of €227 billion or around 2.2% of the EU’s gross domestic product – outperforming the European aerospace or pharmaceutical industries – and directly employs 3.4 million people. Close to half of European companies active in manufacturing, agriculture, water, and food services have recently eco-innovated and benefited as a result. Clearly there is great potential for eco-innovation to create new business opportunities, jobs and growth in Europe.

The Eco-innovation Action Plan (EcoAP) is a logical successor to the ETAP. Launched by the European Commission in December 2011, the new Action Plan will build on the valuable experience gained to date – especially in promoting eco-innovation’s development and uptake across Europe.

The EcoAP is a significant step forward for eco-innovation, moving the EU beyond green technologies and fostering a comprehensive range of eco-innovative processes, products and services. The ambitious plan will also focus on developing stronger and broader eco-innovation actions across and beyond Europe.

Building on valuable eco-innovation experience

The Europe 2020 strategy will set the course for the EU’s economy for at least the next decade. Focused on smart, sustainable and inclusive growth, this strategy aims to support the transition to a resource-efficient, low-carbon economy. Among its Flagship Initiatives is Innovation Union (IU), designed to turn innovative ideas into products and services that generate growth and jobs.

The EcoAP will build on the IU in three ways. Firstly it will expand the focus of innovation policies towards green technologies and eco-innovation. It will also target specific eco-innovation barriers and opportunities – especially those not covered by more general innovation policies. Lastly, it will highlight the role of environmental policy as a factor for economic growth.

EcoAP also complements three other Flagship Initiatives: Resource efficient Europe, Industrial policy for a globalised era, and Agenda for new skills and jobs. Taken together, these will help to put eco-innovation at the forefront of EU action to reduce pressure on the environment, bridge the gap between innovation and the market, and increase opportunities for the creation of green jobs.

Funding eco-innovation today and tomorrow

The EcoAP is a broad policy framework. It provides directions for eco-innovation policy and funding. Until 2013, the eco-innovative projects will be funded under the EU’s Seventh Framework Programme for Research and Technological Development; the Competitiveness and Innovation Framework Programme (CIP); and LIFE+, as well as structural and cohesion funds.

From 2014 to 2020, the main source of support will be Horizon 2020. This new research and innovation programme will strengthen the role of eco-innovation. It will also provide the financial means for implementing the EcoAP. It has for example set aside €3 160 million for climate action and resource efficiency initiatives, which include eco-innovation. To support eco-innovative businesses, the Commission will develop new financial instruments offering them targeted debt and equity facilities.

Eco-innovation, an opportunity for business

Eco-innovation in companies leads to reduced costs, improves capacity to capture new growth opportunities and enhances their reputation among customers. In recent years, eco-industries have emerged as an important segment of the European economy. This sector has an estimated turnover of around €227 billion, corresponding to 2.2% of EU GDP, and employs 3.4 million people directly. Eco-innovation is therefore a powerful instrument, combining reduced negative impact on the environment with a positive impact on the economy and society.

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Objectives

Read the Eco-innovation Action Plan

Seeking a step change for eco-innovation

The Eco-innovation Action Plan (EcoAP) is a comprehensive set of initiatives to improve the market’s uptake of eco-innovation. Adopted by the Commission in 2011, the plan expands the EU’s focus from green technologies to every aspect of eco-innovation – including products and services. In this way, it will bring benefits for the environment, create growth and jobs, and ensure more-efficient use of our increasingly scarce resources.

The EcoAP builds on EU eco-innovation activities and experience gained over the last decade, especially under the Environmental Technologies Action Plan (ETAP). These encompass everything from recycled materials to wastewater treatment, and from green business and smart purchasing schemes to environmental labelling.

Accelerating market uptake

Eco-innovation supports innovative products, services and technologies that make better use of resources, while reducing Europe’s ecological footprint. With the exception of renewable energy however, eco-innovation has a limited access to markets.

So the EcoAP will target eco-innovation’s biggest barriers, such as market uncertainty and worries about return on investment. It will also address eco-innovation’s main drivers, among them high energy prices, targeted regulations and standards, and access to knowledge. Above all the plan will strive to accelerate development and uptake of eco-innovations by:

  • Stepping up current actions
  • Optimising the use of existing resources
  • Mobilising additional financial resources

Strengthening governance and awareness

The European Commission and Member States will provide strong governance for eco-innovation policies with a dedicated High-Level Working Group. Other public and private actors will be invited to form a Multi-Stakeholder Group, so as to enlarge the dialogue to businesses and the civil society – which are vital transmission points for eco-innovation initiatives.

The Commission and Member States will also coordinate national and EU policies on eco-innovation, for example by identifying and exchanging information on good practice. A range of useful tools will be available to them, including Eco-innovation National Roadmaps and Eco-innovation Fora. An Eco-innovation Scoreboard will gather data on eco-innovation performance across the EU and beyond, thus helping to monitor and evaluate progress made by 2020.

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Actions

Action 1. Environmental policy and regulation

European environmental policy has moved European industries towards greater sustainability. The goal now is for eco-innovation to be at the heart of the revision of EU legislation – from air and water to waste and infrastructure. The Commission wants to perform a selective screening of European regulations in these areas, leading to specific and evidence-based recommendations for action.

Action 2. Demonstration projects

However promising they may look on paper, many eco-innovation technologies still fail to make the leap from lab to market. Starting in 2012, the Commission will fund eco-innovation demonstration projects. Participation is open to all industrial sectors and themes – from demolition waste and soil remediation to pesticides and climate change adaptation. This approach will be continued under the Horizon 2020 programme, the next EU research and innovation framework programme, from 2014 to 2020.

Action 3. Standards

Eco-innovation benefits from ambitious standards and performance targets. Working with Member States and international standardisation bodies, the Commission is to launch a dialogue to identify and prioritise areas where standards and targets could have the biggest impacts. Areas likely to be included are waste treatment, drinking water, sustainable construction materials, and building insulation.

Action 4. Funding and SME support

Public sector finance is crucial to accelerate eco-innovation in the private sector, especially in SMEs (small and medium-sized enterprises). To bring new investors onboard, the Commission will create a European network of eco-innovation financiers. It will also launch new funding instruments, in order to offer targeted debt and equity facilities in support of eco-innovative businesses, and expand other services to SMEs, so they can find and exploit eco-innovation opportunities in the EU and beyond.

Action 5. International cooperation

Emerging economies such as China, India and Brazil offer new market and partnership opportunities for European eco-investors. To capitalise on these opportunities, the Commission will promote the establishment of European business and technology centres in support of European businesses seeking to expand their market.

Action 6. Skills and knowledge

EU Skills Panorama is a Commission initiative mapping out current and future skills needs in Europe, with a focus on green jobs. The aim is to drive forward the transition to a green economy by equipping tomorrow’s labour force with relevant skills and knowledge. The Commission will also facilitate information exchange between Member States on training schemes targeted at eco-innovation.

Action 7. European Innovation Partnerships

European Innovation Partnerships are initiatives that aim to bring together public and private actors in key sectors where eco-innovation could contribute to create greater resource efficiency. Partnerships are being set up for raw materials, sustainable agriculture, and water.

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