Hungary: start of a first eco-innovation strategy

Hungary: start of a first eco-innovation strategy

The Hungarian government adopted the National Environmental Technology Innovation Strategy (NETIS) at the end of 2011 as its framework for eco-innovation within the Hungarian National Reform Programme. This National Reform Programme is Hungary's contribution to Europe 2020 – the European Union's overarching programme for smart, sustainable and inclusive economic growth.

NETIS is part of the Hungarian National Reform Programme's ‘18th measure’, which foresees the renewal and implementation of the country's research and development and innovation programme. The government's vision is to foster environmental industries and technology, to focus on environmental innovation, to reduce primary material use and encourage reuse and recycling, and to ensure a paradigm shift from an “end-of-pipe” approach to environmental issues to prevention of problems.

A targets-based approach will be used: Hungary has adopted no fewer than 17 targets to be achieved by 2020. These are expressed in percentage terms against current levels. For example, materials, energy and water intensity per unit of GDP will be reduced to 80% of current levels; the share of renewables in electricity generation will rise by 275%; municipal solid waste generation will fall by 30%; and employment in environmental industries will rise to twice the current level.

To finance these measures, the Hungarian government is looking at a range of funding possibilities: European Union research funds, agricultural, cohesion and structural funds, and the Norwegian Financial Mechanism, which is available through Norway's membership of the European Economic Area (EEA), and which includes increasing the uptake of environmentally friendly technologies among its priorities for Hungary.

Hungary's Ministry of Rural Development, which is implementing NETIS, provided the following information about the plan:

In the NETIS summary document, it is noted that Hungary relies on energy and resource imports. Does Hungary have targets for reducing these imports, or resource efficiency targets? What role can eco-innovation play in meeting these targets?

Yes, Hungary has specific targets relating to the reduction of import dependency. As indicated in NETIS our target is to reduce material and energy intensity (domestic material consumption/GDP, tonnes of oil equivalent/GDP respectively) by 20% by 2020 (base year 2007). NETIS intends to be the catalyst of smart solutions that aims at reaching our ambitious targets by providing overarching policy support.

Is eco-innovation in Hungary all about environmental technologies, or does the NETIS approach also include changes to systems and behaviours to reduce environmental impacts?

Of course, NETIS covers not only ‘technical’ issues. From the point of view of NETIS, environmental technologies are not just individual technologies, but total systems that include know-how, procedures, goods and services, and equipment, as well as organisational and managerial procedures. Environmental technologies not only protect the environment, but they are less polluting, use all resources in a more sustainable manner, recycle more of their waste and products, and handle residual waste in a more acceptable manner than the technologies for which they were substitutes. As shown in the figure below, there is a wide scope for innovation and intervention in this field.

Types of environmental technology innovations:

What are the main eco-innovation priorities for Hungary? Why are these issues prioritised?

NETIS has clustered its targets and development areas around the following eight topics: 1) Waste 2) Water 3) Air 4) Noise and vibration 5) Agriculture and soil protection 6) Remediation 7) Renewable energy 8) Construction industry. The reason for selecting these priority groups is that they have a common feature: in each area there is great room for ameliorating the current state [level of environmental impact] by various means. In each of the eight priority areas, considerable positive changes can be made.

Has NETIS completed the review of the current position of environmental industry and policy practices? What were the main findings of the review?

Yes, NETIS has been developed based on thorough investigation of the position of environmental industry both on national and EU level. In addition, relevant remarkable international policies have been revised to gain an overall view, and to learn from the worldwide applied ‘good’ practices.

On national level, more than 400 enterprises participated in the survey research on which the findings were based. Besides the private sector, academia, professional chambers/associations and governmental sectors were also involved. The review allowed us to identify the most demanding challenges, such as long payback period of investments, rapidly-changing, complex and increasingly growing system of legal (EU/national) requirements, and the competitive disadvantages faced by small and medium-sized enterprises in the era of merging companies.

NETIS has already been mainstreamed in many relevant strategic and planning documents (e.g. National Development Plan, [EU] Multiannual Financial Framework Planning document, R&D&I White Book), which we consider as great successes of its implementation. The innovative aspect of the Strategy is reflected by its title – given the fact that this is the first national strategy with a focus on environmental technology. Before there was no such governmental tool for this specific area.

Are there any early results of NETIS?

Yes, thanks to the extensive involvement of all stakeholders during the NETIS consultation, the concept of green economy has been vastly disseminated among decision-makers. Furthermore, the understanding of decoupling GDP and environmental load has been significantly increased on national level. The planting of green economy ‘seeds’ has successfully been performed. As we all know about the creative power of thought, we do believe that it will result in a real life paradigm shift.

Are there already successful examples of eco-innovation in Hungary?

In 2011, the 20th Hungarian Innovation Grand Prize – announced by the Hungarian Innovation Foundation with the Hungarian Association for Innovation, the Ministry for National Economy, Ministry of Rural Development, Hungarian Intellectual Property Office and the Public Foundation for the Development of Industry – was awarded to the Budapest Central Wastewater Treatment Plant (BCWTP).

As a result of BCWTP 's R&D and Innovation activities, the improvement in energy efficiency of the biggest Hungarian wastewater treatment facility generated net savings of HUF 604 million (€2.05 million) in total electricity consumption. This was due to a new energy optimisation solution, coupled with combustion of biogas derived from sewage sludge.

How can Hungarian participation in the eco-innovation action plan at EU level (e.g. in the High Level Working Group) help with developments in Hungary?