Communication from the Commission to the Council and the European Parliament - Stimulating Technologies for Sustainable Development: An Environmental Technologies Action Plan for the European Union
Date: 2004-01-28
Institutions: European Commission
Subjects: EU environmental policy, economic growth, environmental protection, new technology, research and development, sustainable development

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 28.1.2004 
COM(2004) 38 final 

COMMUNICATION FROM THE COMMISSION 
TO THE COUNCIL AND THE EUROPEAN PARLIAMENT 

Stimulating Technologies for Sustainable Development: An Environmental Technologies 
Action Plan for the European Union 

EN 

   EN 

 
 
 
  
COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE 
EUROPEAN PARLIAMENT 

Stimulating Technologies for Sustainable Development: An Environmental Technologies 
Action Plan for the European Union 

(Text with EEA relevance) 

1. 

INTRODUCTION 

Sustainable development – development that meets the needs of the present without 
compromising  those  of  future  generations  –  is  at  the  core  of  the  European  Union’s 
(EU) objectives. In 2001, the Göteborg European Council launched the EU strategy 
for  sustainable  development.  This  set  ambitious  objectives  and  called  for  a  more 
integrated approach to policy making in which economic, social and environmental 
objectives can be achieved at the same time. It therefore complemented  the  Lisbon 
strategy  to  make  the  EU  “the  most  competitive  and  dynamic  knowledge-based 
economy in the world, capable of sustainable economic growth with more and better 
jobs and greater social cohesion”. It also underlined that “sustainable development 
requires global solutions”, thereby supporting the EU’s efforts to take a leading role 
internationally to promote global economic and social development while protecting 
the  environment.  The  strategic 
in  research  and 
development  (R&D)  for  the  Lisbon  Strategy  and  sustainable  development  was 
recognised at the 2002 Barcelona European Council, where it was agreed that overall 
spending on R&D in the EU should increase and  approach 3 % of  Gross  Domestic 
Product (GDP) by 2010. Investing in research, from both private and public sources, 
is vital for the EU economy, including eco-industries. 

importance  of 

investment 

The  potential  of  technology  to  create  synergies  between  environmental  protection 
and  economic  growth  was  recognised  by  the  October  2003  European  Council. 
Environmental  technologies  –  taken  in  this  Action  Plan  to  include  all  technologies 
whose  use  is  less  environmentally  harmful  than  relevant  alternatives1  -  are  key  to 
this.  They  encompass  technologies  and  processes  to  manage  pollution  (e.g.  air 
pollution  control,  waste  management),  less  polluting  and  less  resource-intensive 
products  and  services  and  ways  to  manage  resources  more  efficiently  (e.g.  water 
supply,  energy-saving  technologies).  Thus  defined,  they  pervade  all  economic 
activities  and  sectors,  where  they  often  cut  costs  and  improve  competitiveness  by 
reducing energy and resource consumption, and so creating fewer emissions and less 
waste.  These  potential  benefits  can  also  be  of  great  importance  for  developing 

1 

This definition is based on the definition given in Chapter 34 of Agenda 21 for environmentally sound 
technologies.  This  states  that,  “Environmentally  sound  technologies  protect  the  environment,  are  less 
polluting,  use  all  resources  in  a  more  sustainable  manner,  recycle  more  of  their  wastes  and  products, 
and  handle  residual  wastes  in  a  more  acceptable  manner  than  the  technologies  for  which  they  were 
substitutes.  Environmentally  sound  technologies  in  the  context  of  pollution  are  process  and  product 
technologies that generate low or no waste, for the prevention of pollution. They also cover end of the 
pipe  technologies  for  treatment  of  pollution  after  it  has  been  generated.  Environmentally  sound 
technologies  are  not  just  individual  technologies,  but  total  systems  which  include  know-how, 
procedures, goods and services, and equipment as well as organisational and managerial procedures”.  

2 

 
 
  
 
                                                 
countries. With sufficient technology transfer they can provide these countries with 
affordable solutions for reconciling their desire for strong economic growth with the 
need  to  do  so  without  increasing  the  pressure  on  the  local,  or  the  global, 
environment. 

This  Environmental  Technologies  Action  Plan  (ETAP)  therefore  aims  to  harness 
their  full  potential  to  reduce  pressures  on  our  natural  resources,  improve  the 
quality of life of European citizens and stimulate economic growth. As such it is 
an important means to implement the EU Sustainable Development Strategy and to 
pursue  the  Lisbon  Strategy,  while  also  helping  developing  countries.  It  is  based  on 
the  recognition  that  there  is  significant  untapped  technological  potential  for 
improving  the  environment  while  contributing  to  competitiveness  and  growth. 
Encouraging  the  choice  of  advanced  environmental  technologies  in  all  investment 
and  purchasing  decisions  will  go  some  way  towards  realising  this  potential,  thus 
widening their market and reducing their cost. This Action Plan sets out a series of 
measures to do this; measures that will require a concerted effort by the Commission, 
Member States and partners in the research community, industry and civil society. 

The Action Plan’s objectives are: 

•  to  remove  the  obstacles  so  as  to  tap  the  full  potential  of  environmental 
technologies for protecting the environment while contributing to competitiveness 
and economic growth; 

•  to ensure that over the coming years the EU takes a leading role in developing and 

applying environmental technologies; 

•  to mobilise all stakeholders in support of these objectives. 

This Action Plan is based on the results of extensive stakeholder consultations. These 
began  with  the  Commission’s  analysis  of  the  contribution  that  environmental 
technologies  make  to  economic  growth  and  employment  and  a  first  assessment  of 
barriers  hindering  their  greater  use.2  Concrete  questions  were  then  posed  to 
stakeholders  in  March  20033  and  the  Commission  established  four  issue  groups 
involving stakeholders. These, along with the responses to the consultation exercise, 
provided valuable input to this Action Plan (see Annex I).  

2. 

THE POLICY CONTEXT 

The time is right… 

The  Göteborg  European  Council  and  the  EU’s  Sixth  Environment  Action 
Programme  (6EAP)4  have  set  the  overall  objective of  decoupling  economic  growth 
from environmental degradation. Some progress has already been made in important 

2 

3 

4 

COM  (2002)  122  final,  13.3.2002,  Report  from  the  Commission:  Environmental  technology  for 
sustainable development  
COM  (2003)  131  final,  25.3.2003,  Communication  from  the  Commission:  Developing  an  action  plan 
for environmental technology 
Decision 1600/2002/EC of the European Parliament and the Council of 22 July 2002 laying down the 
Sixth Community Environment Action Programme 

3 

 
 
  
 
                                                 
areas,  such  as  air  and  water  pollution.  However,  environmental  impacts  remain 
unsustainable. Indeed, in many areas, environmental pressures and impacts on public 
health and quality of life are actually increasing. Reversing these trends will require 
major  investment  in  the  development  and  use  of  environmental  technologies.  This 
investment  needs  to  begin  now  if  the  EU  is  to  meet  the  long-term  challenge  of 
sustainable development. Achieving the Lisbon objectives requires investments to be 
substantially increased. This provides an ideal opportunity to integrate environmental 
technologies into these investment decisions. 

The EU has a global responsibility… 

The  EU  also  shares  responsibility  for  the  global  environment  because,  just  as  the 
resources  it  uses  are  not  limited  to  those  from  Europe,  nor  are  its  negative 
environmental  impacts.  It  has  shown  leadership  in  international  policies  for 
sustainable development, such as the Kyoto Protocol and the ten-year framework of 
programmes  for  sustainable  production  and  consumption  established  at  the  World 
Summit on Sustainable Development (WSSD). Well targeted, Europe’s potential for 
innovation  can  help  develop  technologies  that  other  countries  may  need  to  develop 
their  economies,  while  reducing  environmental  degradation.  In  several  areas, 
European  environmental  technologies  are  already  globally  significant.  Other 
countries are also developing these technologies and maintaining EU leadership will 
require increased effort but will, in turn, consolidate its strong position to argue for 
serious  efforts  by  other  countries  to  provide  a  continued  drive  for  sustainable 
development. 

It will be supported by significant research efforts… 

Developing  and  making  better  use  of  environmental  technologies  will  also  help  to 
meet  the  Lisbon  objective  and  modernise  our  economy  by  contributing  to 
technological  innovation,  increasing  European  competitiveness,  unlocking  potential 
markets  and  thus  creating  new,  skilled  jobs.  The  Community  target  to  increase 
research  and  technological  development  spending  to  3 %  of  GDP  by  2010  is 
important  here  as  it  should  result  in  more  environmental  technologies  becoming 
available  for  market  application.  The  ongoing  implementation  of  the  European 
Research  Area  (ERA)  will  also  create  favourable  conditions  for  the  emergence  of 
environmental  technologies  with  wide  market  applications  and  will  enhance  the 
possibility  to  develop  lead  markets  for  innovative  “green”  products  or  processes.5 
The Seventh Framework Programme (FP) for Research, Technological Development 
and  Demonstration  (2006-2010)  will  also  present  opportunities 
to  further 
environmental  technologies.  These  can  take  advantage  of  the  results  of  earlier 
Framework  Programmes  and  other  EU  policies  and  initiatives  where  significant 
resources have been invested, such as the European Investment Bank’s “Innovation 
2010” initiative and the Biotechnology6, eEurope and Innovation action plans. 

EU enlargement will provide a further incentive… 

5 

6 

COM (2003) 112 final – Innovation Policy: updating the Union’s approach in the context of the Lisbon 
Strategy 
COM (2002) 27 final Communication from the Commission to the Council, European Parliament, the 
Economic and Social Committee and the Committee of the Regions: Life Sciences and Biotechnology – 
a Strategy for Europe 

4 

 
 
  
 
                                                 
The  accession  of  ten  new  Member  States  in  May  2004  will  also  lead  to  more 
investment.  These  countries  are  going  through  a  process  of  modernising  their 
economies  and  are  adapting  to  EU  environmental,  health  and  safety  standards,  of 
which complying with just the environmental standards will cost between €50 and 80 
billion.  This  creates  a  big  market  for  environmental  technologies.  The  enlarged 
Single  Market  will  also  offer  one  of  the  largest  markets  in  the  world  for  applying 
new  solutions  and  providing  economies  of  scale  for  innovative  technologies  and 
products. The new financial perspectives for after 2006 and the reform of cohesion 
policy  provide  further  opportunities  for  investing  in  advanced  environmental 
solutions. 

The  EU  is  well  placed  to  launch  an  ambitious  strategy  for  environmental 
technologies… 

European  consumers  have  become  more  aware  of  environment  and  health  issues. 
The  ensuing  consumer  demand  for  “greener”  products  has  contributed  to  high 
environmental  standards  and  given  the  EU  a  competitive  edge  in  developing  and 
applying environmental technologies in consumer products. 

European  business  has  also  made  encouraging  progress  towards  decoupling 
industrial output from certain polluting emissions. It has taken the lead in corporate 
social  responsibility  and  triple  bottom  line  reporting,  while  the  financial  sector  has 
become  increasingly  aware  of  the  benefits  of  social,  environmental  and  ethical 
the  potential  of  many  environmental 
investments.  Business  has  also  seen 
technologies to increase competitiveness and in a number of areas, such as advanced 
power generation7, photovoltaics, wind energy and water supply and treatment, it has 
become a leading producer and exporter. 

There are many policies and initiatives on which to build… 

Existing EU  policies are a firm base to  build  on.  The  6EAP  identifies four priority 
areas  on  which  particular  attention  needs  to  be  focused  over  the  next  ten  years: 
climate change, nature and bio-diversity, health and quality of life and management 
of  natural  resources  and  wastes.  This  provides  a  clear  and  ambitious  policy 
the  development  and  dissemination  of  new  environmental 
framework  for 
technologies;  such  a  framework  is  a  prerequisite  for  promoting  their  development. 
Existing  policies  ensure  that  some  production  meets  high  environmental  standards, 
for  example  through  the  Directive  on  Integrated  Pollution  Prevention  and  Control 
(IPPC).8  Regulation  has  been  complemented  with  market-based  and  voluntary 
instruments, such as environmental management systems,9 eco-labelling10 and, most 

7 

8 

9 

10 

This is a clean technology for producing electricity or combined electricity and heat from fossil fuels in 
which the thermal efficiency is much higher than for conventional power generation. Examples include 
clean coal technology and highly-efficient combined cycle gas turbines 
Council  Directive  96/61/EC  of  24  September  1996  concerning  integrated  pollution  prevention  and 
control, OJ L 257, 10.10.1996, p. 26-40 
Regulation  761/2001  of  the  European  Parliament  and  of  the  Council  of  19  March  2001  allowing 
voluntary participation by organisations in a Community eco-management and audit scheme (EMAS), 
OJ L 114, 24.4.2000, p. 1-29 
Regulation  1980/2000  of  the  European  Parliament  and  of  the  Council  of  17  July  2000  on  a  revised 
Community eco-label award scheme, OJ L 237, 21.9.2000, p. 1-12 

5 

 
 
  
 
                                                 
recently  the  Community’s  greenhouse  gas  emissions  trading  scheme.11  Integrated 
Product  Policy  (IPP)  strengthens  the  environmental  performance  of  products  while 
the  Commission’s  proposal  to  reform  chemicals  legislation  (REACH)  will  improve 
the  protection  of  the  environment  and  public  health  and  encourage  innovation  and 
safeguard competitiveness at the same time. 

Finally,  other  stakeholders  have  also  taken  significant  measures,  for  example  at 
national  or  regional  level  (see  examples  in  Annex  III).  These  provide  a  wealth  of 
experience to capitalise upon, to exchange and to disseminate. In addition there are 
several voluntary initiatives that can be built on. 

The  overall  aim  is  therefore  clear:  to  exploit  the  potential  of  environmental 
technologies  for  meeting  the  environmental  challenges  faced  by  mankind  while 
contributing  to  competitiveness  and  growth.  The  more  widespread  application  of 
existing processes, techniques and products, and future technological breakthroughs 
will  allow  economic  growth  to  be  decoupled  from  environmental  impacts,  thereby 
reconciling economic and environmental objectives. Many companies in Europe and 
elsewhere  have  already  realised  that  moving  to  more  eco-efficient  production  and 
products  will  both  improve  environmental  performance  and  cut  costs  for  energy, 
resource  input  and  waste  management.  New  markets  for  environmental  goods  and 
services are emerging in the EU and world-wide. Investments in new environmental 
technologies may therefore offer an attractive growth dividend. 

3. 

BUILDING THE ACTION PLAN 

From  the  consultations  undertaken  in  preparation  of  this  Action  Plan,  the 
Commission  identified  a  number  of  general  factors  that  are  of  importance  when 
promoting environmental technologies and which underpin this Action Plan. 

– 

There is potential to promote environmental technologies in all economic 
sectors – Environmental technologies are very diverse. They vary in maturity 
(some  are  already  in  use,  while  others  are  still  on  the  drawing  board)  and  in 
scope  (some,  like  information  and  communication  technologies,  cut  across 
different application areas whilst others are more focussed on a specific issue 
e.g.,  carbon  sequestration  techniques).  The  Action  Plan  will  provide  a 
framework  that  will  allow  this  diversity  to  flourish,  rather  than  seeking  to 
establish a “one size fits all” solution. Fully realising this potential will require 
substantial investments in human capital. 

Environmental technologies are very diverse: the example of ICT 

Information and communication technologies are increasingly embedded into all kinds of systems and 
processes.  These  embedded  ICT  systems  already  today  control  power  plants  and  car  engines.  They 
provide the intelligence needed to reduce environmental pollution and avoid the wastage of natural 
resources.  They  also  allow  the  introduction  of  entirely  novel  technologies  that  have  a  favourable 
impact on the environment such as: 

11 

Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a 
scheme for greenhouse gas emission allowance trading within the Community and amending Directive 
96/61/EC, OJ L 275, 25.10.2003, p. 32-46 

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- networked embedded controllers maximise the energy efficiency of industrial production processes. 
They also minimise the emission of dangerous pollutants; and 

- intelligent sensing networks deployed in buildings can reduce heating needs to a bare minimum. 

They will also give rise to new applications some of which are difficult to predict today. 

–  Many  potentially  significant  environmental  technologies  exist,  but  are 
underused.  Many  factors  contribute  to  this.  These  include  the  lock-in  to 
existing  technologies,  price  signals  that  favour  less  eco-efficient  solutions, 
difficult  access  to  finance  and  low  consumer  and  purchaser  awareness.  This 
situation needs to be significantly improved for environmental technologies to 
prosper. 

– 

– 

– 

Targeted  and  effective  incentives  to  the  introduction  of  environmental 
technologies  can  pave  the  way  for  lasting  success  –  This  has  been  clearly 
demonstrated,  for  example,  with  wind  turbines,  where  the  EU  is  now  the 
market leader. Strong policy incentives have led to a situation where 75 % of 
the  world  wind  energy  installed  capacity  is  in  the  EU.  In  addition,  promising 
technologies  have  been  identified,12  of  which  a  limited  number  will  be 
identified  as  examples  throughout  this  Action  Plan  alongside  the  priority 
actions that are particularly important for stimulating their immediate take-up 
and longer-term development. In particular, cross-cutting technologies, such as 
information  and  communications  technologies  (ICT),  nanotechnologies  and 
biotechnologies, have an important role to play. 

Reducing uncertainty about future market developments will help to boost 
in  environmental  technologies.  Investment  decisions  will 
investment 
certainly  benefit  from  a  clearer  picture  of  how  markets  develop  in  the  long-
term.  This  includes  factors  such  as:  likely  legislation,  standards  and  targets; 
trends  in  consumer  behaviour;  how  law  enforcers  will  react  to  new 
(economic  and  environmental)  on 
technologies; 
environmental  technologies  and  their  likely  evolution  compared  to  other 
relevant alternatives; and on the extent to which the public sector will demand 
environmental technologies through purchasing.  

information 

reliable 

It is important to build on the experience and the commitment of different 
stakeholders  -  The  commitment  of  many  different  stakeholders  was  shown 
during  the  work  of  the  four  issue  groups  that  were  established  to  identify 
promising environmental technologies and identify barriers to their uptake. In 
particular,  it  emerged  that  various  pockets  of  particularly  good  practice  in 
enhancing investment for environmental technologies exist, mainly at national, 
regional and local levels. The Plan will capitalise on the considerable potential 
benefits from sharing experience by co-ordinating and facilitating exchanges of 

12 

Based  on  previous  technology  foresight  exercises  carried  out  in  some  EU  Member  States  -  See  for 
example  “Weterings,  R.,  Kuijper,  J,  Smeets,  E,  1997:  81  options  –  Technology  for  sustainable 
development – Final report of the Environment-oriented Technology Foresight Study, commissioned by 
the  Dutch  Ministry  of  Housing,  Physical  Planning  and  the  Environment,  the  Netherlands,  TNO, 
http://www.tno.nl 

7 

 
 
  
 
                                                 
– 

– 

good  practice.  It  also  recognises  that  developing  countries13  have  their  own 
contribution  to  make,  for  example  through  the  potential  of  traditional 
knowledge to provide solutions. 

There is a need to optimise the use of different policy instruments – Many 
different types of policy instruments – from legislation, through market-based 
and  economic  instruments  to  voluntary  measures  –  can  be  used  to  accelerate 
the  uptake  of  environmental  technologies.  It  is  important  to  choose  the  most 
effective measure – or combination of measures – to create an environment that 
encourages those who develop, purchase and use environmental technologies. 

Some of the measures which are needed may take time to affect investment 
decisions - The time for research and development to come to fruition is often 
long,  as  is  the  investment  cycle  within  companies  and  public  bodies.  In 
addition,  it  takes  time  for  policies  to  change,  for  example  on  getting  prices 
right.  Given  these  time  lags  it  is  necessary  to  act  now  if  there  is  to  be  a 
significant impact in the medium to long term.  

The  consultations  carried  out  by  the  Commission  also  identified  many  different 
barriers to the development and diffusion of environmental technologies. These are 
summarised in Annex II. 

4. 

THE ACTIONS 

The  actions  proposed  fall  into  three  main  areas:  getting  from  research  to  markets; 
improving  market  conditions;  and  acting  globally.  All  these  actions  are  listed  in 
tables  at  the  end  of  each  sub-section.  These  tables  also  show  the  priority  actions 
(PAs)  in  bold.  The  cost-effectiveness  of  measures  that  have  a  direct  impact  on 
business  should  be  analysed  in  line  with  the  Commission’s  rules  on  impact 
assessment.14 

4.1. 

Getting from research to markets 

Given  the  increasing  world-wide  demand  for  and  pressure  on  natural  resources, 
existing  technologies  are  not,  in  the  longer  term,  adequate  to  safeguard  sustainable 
development.  This  Action  Plan  puts  forward  actions  to  attract  more  private  and 
public  investment  for  the  development  and  demonstration  of  environmental 
technologies in line with the EU objective of 3 % of GDP for research. The actions 
aim to improve the innovation process and to take inventions out of laboratories and 
onto the market. 

Besides increasing and focusing research, demonstration and dissemination, there are 
two  innovative  actions,  the  establishment  of  technology  platforms  and  of  testing 
networks,  which  show  how  public/private  partnerships  can  be  established  and  how 
research can come closer to the market. 

13 

14 

In this Plan the general term, developing countries, is used. However, it is recognised that many of the 
actions  contained  in  this  document  could  also  usefully  be  applied  in  other  countries  which  may  not 
normally be considered as such. 
COM(2002) 276 final, Communication from the Commission on Impact Assessment 

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4.1.1. 

Increase and focus research, demonstration and dissemination 

Many  environmental  impacts  can  be  reduced  using  existing  technologies,  but  new 
technologies and more cost-effective solutions are always needed. The energy sector, 
for example, will benefit from new energy-efficient technologies and greater uptake 
of  renewable  energy  sources.  However,  current  consumption  trends  –  to  a  large 
extent determined by cost and availability - mean that conventional energy sources, 
such  as  fossil  fuels,  will  continue  to  be  significant  sources  of  supply.  Hence,  if 
climate change is to be minimised more research is needed into carbon sequestration 
or  clean  coal  consumption  techniques,  as  well  as  into  renewables  and  energy-
efficient technologies. 

National and Community research and development (R&D) and innovation financing 
programmes, such as the Sixth Research Framework Programme (FP) (2002-2005), 
already  devote  significant  resources 
the  development  of  environmental 
to 
technologies  as  well  as  to  research  on  socio-economic  drivers,  external  costs  and 
societal  attitudes.  However,  there  is  also  potential  to  further  improve  the 
effectiveness  and  efficiency  of  the  existing  funding  mechanisms,  including  the 
European  Investment  Bank,  in  key  technology  areas.  Financing  programmes,  in 
particular,  need  to  facilitate  effective  small  and  medium-sized  enterprise  (SME) 
participation.  It  is  also  necessary  to  strengthen  mechanisms  to  support  the 
dissemination  and  exploitation  of  research  results,  as  well  as  accelerating 
technological  transfer.  Very  importantly  too,  the  potential  of  fundamental  research 
has to be better exploited to contribute more effectively to technology development. 

The need to reinforce research: the example of photovoltaics 

Solar  energy  is  a  very  attractive  energy  source  that  could,  with  further  technological  progress  and 
cost reductions, meet a substantial part of the EU’s electricity demand and have a beneficial impact 
on the environment and on society. The current photovoltaics share of the EU’s electricity production 
is  currently  only  0.024%,  mainly  due  to  the  high  installation  costs  (five  to  ten  times  the  cost  of 
conventional electricity) but it is growing rapidly and costs are expected to diminish. In the EU, it is 
acknowledged  that  photovoltaics  are  being  held  back  by  low  research  budgets  and  fragmented 
research and market development programmes, unlike the situation in Japan. 

The  Commission  will  encourage  stakeholders  to  engage  more  intensively  in  the 
demonstration and dissemination components of the FP, especially in the Integrated 
Projects,  and  will  also  encourage  Member  States  to  review  their  own  R&D 
programmes and set similar objectives. 

Improved  co-ordination  of  national  and  regional  environmental  technology-related 
programmes, 
including  foresight  research,  can  stimulate  synergies,  promote 
economies of scale and help disseminate good practice. This can leverage private and 
public  investment  beyond  what  could  be  achieved  through  the  FP  alone.  The 
Commission  will  initiate  this  through  the  various  initiatives  taken  within  the 
European Research Area, including, for example, the ERA-NET15 instrument of the 
FP, as well as examining the possibility of using the rules in Article 169 of the Treaty 
for participation in research programmes undertaken by several Member States. 

15 

See http://www.cordis.lu/coordination/home.html and Annex III for an example of good practice 

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In  addition,  research  should  lead  to  commercial  applications  more  often.  New 
environmental  technologies  also  require  greater  efforts  to  bring  them  to  the  market 
than  other  innovations.  Users  need  to  be  made  aware  of  their  potential  through 
demonstration actions and information on their performance and costs. 

More  funding  should  be  made  available  for  pilot,  demonstration  and  dissemination 
actions  for  promising  environmental  technologies.  Apart  from  the  Framework 
Programme  which  is  the  main  fund-raiser  for  EU-level  demonstration,  the 
Commission  will  promote  the  demonstration  and  dissemination  of  mature  research 
results by other financing programmes that can provide additional resources to pilot 
projects, such as the Structural Funds or the LIFE programme. The EU-wide network 
of  Innovation  Relay  Centres  (see  example  in  Annex  III)  will  continue  and,  where 
possible, step up its activities on the transfer of environmental technologies. Member 
States  need  to  take  the  necessary  steps  to  ensure  additional  funds  for  the  pilot 
implementation  of  mature  research  results  developed  at  national  level.  In  addition, 
the Global Monitoring of Environment and Security (GMES) initiative will support 
environmental technologies based on space applications and remote sensing. 

The importance of stepping up demonstration and dissemination: the example of white biotechnology 

Industrial (or “white”) biotechnology offers new ways to improve the environmental performance of 
industrial  processes  in  various  sectors,  including  traditional  industries  such  as  chemicals,  textile, 
leather and paper, and high-value sectors such as pharmaceuticals. Such applications (e.g. bio-mass 
for  energy/fuels  and  industrial  feedstock,  bio-polymers,  bio-catalysis  and  bio-remediation)  have  the 
potential  for  reductions  in  raw  materials  and  energy  consumption,  as  well  as  less  pollution  and 
increased rates of recyclable and biodegradable waste. This potential has been shown in a growing 
number of industrial cases16 but further demonstration and dissemination is needed. 

At the same time, using the possibilities under the 6FP, the Commission will promote 
further  research  on  the  environmental  and  health  costs  and  benefits  of  policies  and 
technologies,  and,  together  with  the  Member  States,  ensure  that  it  is  better  co-
ordinated across Europe.17 

4.1.2. 

Shaping a common vision through technology platforms 

Building on some of the promising environmental technologies identified in the work 
of  the  ETAP  issue  groups,  the  Commission  intends  to  establish  a  number  of 
technology  platforms18  on  promising  environmental  technologies.  A  technology 
platform is a mechanism to bring together all interested stakeholders to build a long-
term vision to develop and promote a specific technology or solve particular issues. 
Two  environmental  technology  platforms  on  hydrogen  and  fuel  cells,  and  on 
photovoltaics  are  already  planned  to  start  in  early  2004,19  and  another  on  water 

16 

17 

18 

19 

See,  for  example  the  OECD  report,  2001,  "The  Application  of  Biotechnology  to  Industrial 
Sustainability",  which  describes  successful  case  studies  in  several  sectors  and  the  European 
Commission  (2002),  “The  Assessment  of  Future  Environmental  and  Economic  Impacts  of  Process-
Integrated Biocatalysts”, EUR 20407 EN, Seville 
An example of a current project is ExternE, which looked at the external costs of producing electricity 
from coal and other fuels (http://externe.jrc.es). 
Such  platforms  can  optimise  the  design  and  implementation  of  R&D  by  taking  account  of  all  major 
socio-economic  and  technological  challenges.  They  provide  a  means  to  increase  synergies  and 
innovation efforts in a given technology sector. 
In  addition,  a  Steel  Technology  Platform  could  be  launched  in  2004.  This  will  deal,  amongst  other 
things,  with  promising  environmental  technologies  identified  by  the  Issue  Group  on  Sustainable 

10 

 
 
  
 
                                                 
supply  and  sanitation  technologies  will  be  launched  in  early  2005.  In  general, 
technology platforms will be launched in those cases where the targeted technologies 
are considered to have significant environmental, economic and social potential.  

The  precise  ways  of  working  of  each  technology  platform  will  be  defined  at  the 
outset but they will have an open structure and could be built upon the foundations of 
existing European initiatives, networks and structures.20 They may be guided by an 
advisory council containing a balance of expert knowledge and stakeholder interests 
and  may  have  a  secretariat  that  is  funded  jointly  by  the  Commission  and 
stakeholders. They will  

– 

– 

– 

– 

– 

– 

develop a strategic research agenda to improve the effectiveness of research in 
this area; 

bring  together  industry  and  financial  institutions  such  as  the  European 
Investment Bank (EIB); 

examine 
commercialisation; 

possibilities 

for 

public-private 

partnerships 

to 

promote 

consider  the  possibilities  for  improving  technology  transfer  to  developing 
countries, in particular to least developed countries; 

develop a strategy for Europe-wide education and training programmes in this 
area; 

make  proposals  for  demonstration  and  dissemination  projects,  including 
examining how EU Information sources (such as Info Points, Euro Info centres 
and Euroguichets) could be used to provide information to relevant operators. 

In parallel to the establishment of technology platforms, the Commission will initiate 
a  dialogue  with  stakeholders  on  specific  issues  relating  to  the  development  and 
deployment of technologies. 

4.1.3. 

Improving 
environmental technologies 

testing,  performance  verification  and  standardisation  related 

to 

Convincing the market of the merits of their environmental technology is often very 
difficult  for  producers,  and  especially  for  SMEs.  Establishing  a  mechanism  to 
validate  objectively  the  performance  of  these  products  would  increase  purchasers’ 
confidence in new environmental technologies. This has been done in the USA (see 
box below). 

The  “Environmental  Technology  Verification”  programme  of  the  US  Environmental 
Protection  Agency  develops  testing  protocols  and  verifies  the  performance  of  innovative 
technologies  that  have  the  potential  to  improve  protection  of  human  health  and  the 
environment. This successful programme was created in 1995 to accelerate the entrance of 
new environmental technologies into the domestic and international marketplace. It operates 

Production  and  Consumption,  such  as  those  with  a  potential  to  significantly  reduce  carbon  dioxide 
emissions from steelmaking. 
See http://europa.eu.int/comm/research/energy/nn/nn_rt_htp1_en.html 

20 

11 

 
 
  
 
                                                                                                                                                         
through  public/private  testing  partnerships.  All  tests  and  quality  assurance  plans  and 
protocols are developed with the active participation of a broad range of stakeholders. 21 

Many  European  centres  exist  that  are  capable  of  undertaking  such  tests  and 
assessments.  In  particular,  the  Joint  Research  Centre  (JRC)  of  the  European 
Commission has developed expertise in the verification  of certain key technologies 
such  as  renewable  energy  technologies.  In  2004,  the  Commission  will  encourage, 
within  the  framework  of  the  6FP,  the  creation  of  networks  of  such  centres,  based 
around families of technology sectors (e.g. water, energy, food processing). This will 
make the information on their performance more consistent and comparable. These 
networks  will  develop  commonly  agreed  assessment  protocols  and  evaluate  the 
reliability  of  specifications  provided  by  the  technology  producers.  Assessments 
should  verify  the  technological  performance  and  the  claimed  performance  from  an 
economic and environmental viewpoint, taking into account the whole life-cycle of 
the technology. Each thematic network will include one expert organisation capable 
of monitoring and reporting on long-term technology and market prospects. 

The importance of testing and performance verification: the example of on-site soil remediation 

Good examples of technologies that would benefit from the establishment of such a network are the 
emerging  on-site  soil  remediation  technologies,  which  are  particularly  suitable  for  heavily 
contaminated  soils  and  groundwater.  This  is  a  very  cost-effective  way  of  treatment  to  prevent 
pollution in high-risk areas, such as drinking water catchments or protected habitats. Many different 
techniques  have  been  developed  to  do  this  and  the  testing  network  could  carry  out  the  objective 
assessment of their relative strengths and weaknesses and so increase market confidence in them. 

Where appropriate, these networks could also develop common certificates, to allow 
environmental  technology  producers,  including  SMEs,  easier  access  to  the  market 
and  to  national  and  EU  financing  schemes.  Finally,  they  could  also  play  a  role  in 
disseminating information and increasing awareness of promising technologies. 

In  their  pilot  phase,  the  networks  could,  for  example,  focus  on  the  development  of 
testing  protocols  for  recycled  plastics,  biotechnology  products  and  processes  (e.g. 
biofuels),  the  measurement  of  energy  use  or  soil  remediation  technologies.  The 
medium-term objective is to make the networks financially independent. 

In  addition,  the  Commission  will  examine,  together,  where  appropriate,  with  the 
European  Environment  Agency  (EEA),  how  best  to  develop  an  EU  Catalogue,  in 
2005,  of  existing  directories  and  databases22  on  environmental  technologies  to 
provide interested stakeholders with simple access to existing information. 

Furthermore,  standardisation,  ideally  at  the  international  level,  can  stimulate 
innovation.  The  Commission  and  the  Member  States  will  therefore  work  together 

21 

22 

http://www.epa.gov/etv/.  The  market  input  is  given  by  the  active  involvement  of  stakeholder  groups 
consisting  of  technology  buyers,  sellers,  permit  bodies,  consultants,  financial  investors,  exporters  and 
others within each sector concerned. 
For example the European Commission’s Eco-industries database 
http://europa.eu.int/comm/environment/ecoindus/home.htm as well as the BBS database of the 
Innovation Relay Centres (see http://irc.cordis.lu) 

12 

 
 
  
 
                                                 
with CEN and other standardisation bodies to ensure that new and revised standards 
are performance-related and better accommodate environmental technologies.23 

The importance of standardisation: the example of membrane bio-reactors for waste water treatment 

The lack of European standards for wastewater reuse is one of the main barriers to the market uptake 
of membrane bio-reactors for municipal waste water treatment. Membrane bio-reactors have several 
environmental advantages over conventional activated sludge plants: they remove recalcitrant micro-
pollutants  more  effectively  and  they  reduce  the  amount  and  toxicity  of  the  resulting  sewage  sludge. 
They are  currently  more  expensive but provide an  effluent  that  is  ready  for reuse. However, as  this 
reuse is not encouraged by any kind of regulation or standard, the market is not as developed as it 
could be. 

GETTING FROM RESEARCH TO MARKETS 

Action 

Who? 

When? How? 

1 

2 

3 

Increase and focus research, 
demonstration and 
dissemination. Improve co-
ordination of relevant 
programmes. (PA1) 

Commission, 
Member States, 
EIB 

2004-
2005 

Establishing technology 
platforms (PA2) 

Commission, 
stakeholders, EIB  

2004-
2007 

Establishing European 
Networks of technology testing, 
performance verification and 
standardisation (PA3) 

Commission, 
testing centres, 
CEN 

From 
2004 

FP, ERA-NET, Article 169, 
Relay Centres, LIFE 
Programme, Structural 
Funds, GMES, national and 
regional programmes 

FP6 (pilot phase), FP7 
(implementation of the 
Strategic Research Agenda), 
EU Info Points and centres 

FP6 and FP7 

4  Develop an EU catalogue of 

existing directories and databases 
on environmental technologies 

Commission, 
EEA 

2005 

FP6, EEA initiatives 

5 

Ensure that new and revised 
standards are performance-related 

From 
2004 

Dialogue with CEN, 
CENELEC, others 

Commission, 
Member States, 
standardisation 
bodies, CEN, 
CENELEC 

4.2. 

Improving market conditions 

The previous section argued that more research is needed and greater efforts to bring 
environmental  technologies  to  the  market.  However,  the  stakeholder  consultation 
exercise showed that many potentially significant environmental technologies exist, 
but  are  underused.  Many  factors  contribute  to  this.  These  include  the  lock-in  to 
existing  technologies,  price  signals  that  favour  less  eco-efficient  solutions,  difficult 
access to finance and low consumer and purchaser awareness. 

23 

Standardisation gaps exist in very different fields such as recycled plastics, biotechnology products  or 
measurement of energy use. 

13 

 
 
  
 
                                                 
This situation needs to be significantly improved for environmental technologies to 
prosper.  Bold  policy  measures  are  required  to  further  environmental  technologies. 
Positive  incentives  and  an  appropriate  regulatory  framework  are  important,  as  are 
public  procurement24  and  voluntary  instruments.  This  section  therefore  proposes  a 
series  of  such  measures  that  will  encourage  the  market  uptake  of  environmental 
technologies. 

4.2.1.  Performance targets 

Setting  targets  that  are  both  long-term  and  visionary  as  well  as  perceived  as  being 
viable  and  realistic  by  many  different  stakeholders  (e.g.  consumers,  producers  and 
policymakers)  is  one  way  to  encourage  industry  to  develop  and  take  up 
environmental  technologies.  This  has  already  been  done,  to  some  extent,  for 
example, through the Renewables and Biofuels Directives.25 

These  targets  need  to  be  based  on  best  environmental  performance,  while  being 
realistic  from  an  economic  and  social  efficiency  viewpoint26,  as  well  as  different 
regional  conditions.  This  means  focussing  on  concrete  quantifiable  values,  such  as 
shown in the box below for cars and fridges. 

Examples of possible types of performance targets 

Cars are already available that achieve very low CO2 emissions. The technology applied can 
be generalised to other types and more advanced technology is likely to come on stream over 
the  coming  years.  In  this  context,  best  environmental  performance  could  mean  taking  the 
CO2  emissions  of  today’s  best  performing  passenger  cars  as  the  average  standard  in  10-15 
years’ time. 

Fridges  are  another  example.  A  model  is  currently  available  on  the  EU  market  that  uses 
around 35 % of the energy used by an average cold appliance of comparable size and type. In 
this  case  best  environmental  performance  could  mean  taking  this  level  as  the  minimum 
standard in 10 years’ time. 

In  both  cases  this  approach  would  provide  industry  with  the  certainty  with  which  to  make 
investments,  but  also  the  flexibility  to  choose  how  they  reach  the  targets.  For  society  it 
would mean reduced emissions and a better climate for innovation. 

It could mean using existing information on the best in the currently available class27 
or  it  could  seek  to  go  beyond  what  is  currently  available.  When  setting  the 

24 

25 

26 

27 

The European Parliament and Council have recently adopted new directives on public procurement that 
offer ample possibilities for setting performance specifications. Once implemented by Member States, 
these  directives  are  expected  to  have  significant  beneficial  effects  on  the  uptake  of  environmental 
technology procurement over the coming years. 
Directive  2001/77/EC  of  the  European  Parliament  and  of  the  Council  of  27  September  2001  on  the 
promotion of electricity from renewable energy sources in the internal electricity market, OJ L 283 of 
27.10.2001, p. 33-40 and Directive 2003/30/EC of the European Parliament and of the Council on the 
promotion of biofuels or other renewable fuels for transport, OJ L 123 of 17.5.2003, p. 42-46 
This will follow an impact assessment in line with that mentioned in the first paragraph of section 4 of 
this Communication. 
For  example,  making  use  of  existing  EU  Eco-label  or  Energy-Label  criteria  (derived  pursuant  to 
Council Directive 92/75/EEC of 22 September 1992 on the indication by labelling and standard product 
information  of  the  consumption  of  energy  and  other  resources  by  household  appliances,  OJ  L  297, 
13.10.1992, p. 16) 

14 

 
 
  
 
                                                 
performance target, a policy message may be given that the target may, in the longer-
term,  be  made  legally  binding  if  voluntary  action  in  the  sector  concerned  is 
ineffective. The choice of technology to meet the requirements and the timing of the 
necessary  investment  decisions  would  be  left  to  the  relevant  operators  thereby 
encouraging  competition  and  innovation.  As  such  this  would  act  as  a  spur  to 
investment in capital goods and research. 

The  Commission  will  work  with  Member  States  and  other  relevant  stakeholders  to 
consider how best to develop a process to identify such performance targets. 

Where such environmental technologies are products this should be done within the 
framework  of  IPP  where  the  products  with  the  greatest  overall  potential  for 
environmental  improvement  are  in  the  process  of  being  identified,  or  through  the 
Commission’s proposal for a framework directive on the eco-design of energy-using 
products (EuP).28  

4.2.2.  Leveraging investment 

instruments.  These  range  from  classical 

Commercialising  and  using  environmental  technologies  requires  a  broad  mix  of 
through  guarantee 
financial 
mechanisms  to  venture  capital.  The  Commission  also  aims  to  develop  further 
Europe’s  risk  capital  market29  through  the  action  plan,  “The  European  Agenda  for 
Entrepreneurship” and the Innovation Action Plan. 

loans 

The Commission has already begun to explore with the EIB Group how to maximise 
the  use  of  existing  instruments  and  whether  there  is  a  need  to  create  new  ones  to 
share  the  risk  of  investing  in  environmental  technology  projects  and  companies, 
notably through risk capital funds. Initial areas of discussions have focused on: 

– 

– 

a  €500  million  dedicated  financial  facility  to  provide  structured  loans  to 
companies  undertaking  investments  within  the  EU  emissions  trading  scheme 
(ETS) as part of the bank’s actions to support the fight against climate change 
and to promote a low carbon economy; and 

a  €10  million  technical  assistance  facility  to  help  structure  the  investments 
under  point  1  and  prepare  projects  under  the  Joint  Implementation  (JI)  and 
Clean Development Mechanism (CDM) of the Kyoto Protocol. The EIB would 
finance  up  to  €5  million  from  its  own  resources,  and  would  aim  to  have  this 
matched by funds from the Commission’s budget or another source. The Bank 
is  also  considering  the  possibility  of  establishing  an  equity-type  fund  that  it 
might manage to invest in carbon credits. 

Other areas being discussed with the EIB, in the framework of this ETAP, are: 

– 

a  venture  capital  mechanism  to  promote  renewable  energy  projects  and 
companies  in  the  frame  of  the  Johannesburg  Coalition  for  Renewable  Energy 
(JREC).  This  mechanism  could,  for  example,  be  a  public-private  partnership 

28 
29 

COM(2003) 453 final of 1.8.2003 
In the context of the Johannesburg Renewable Energy Coalition, the Commission is undertaking similar 
initiatives  and  feasibility  studies  to  facilitate  access  to  risk  capital  by  investors  in  renewable  energy 
services. 

15 

 
 
  
 
                                                 
establishing  a  revolving  fund  of  funds  that  takes  a  minority  stake  in  venture 
capital  funds.  This  would  increase,  over  time,  to  around  €300  million  and  be 
dedicated  to  renewable  energy  projects/companies  in  partner  countries. 
Revenue returning to the fund could be ploughed into further renewable energy 
projects.  A  similar  type  of  instrument  could  also  be  envisaged  to  spur  the 
provision  of  venture  capital  for  renewable  energy  companies  and  projects 
within Europe, particularly in acceding and candidate countries; 

greater  use  of  the  EIB’s  Global  Loan  instrument  to  support  environmental 
technology projects undertaken by SMEs; 

sustaining  focus  on  research  projects  in  environmentally  cleaner  technologies 
increase  Research, 
the  EIB  Group’s  efforts 
and  products  within 
Development and Innovation support within the EU Growth Initiative and the 
Group’s Innovation 2010 Initiative.30 

to 

– 

– 

In addition, efforts to support the use of the European technology start-up facility and 
of the SME guarantee facility managed by the European Investment Fund31 on behalf 
of the Commission will be intensified. 

Existing public and private venture capital funds can act as financial intermediaries 
for  reaching  SMEs  and  are  particularly  important  in  the  acceding  states  because  of 
the small amount of risk capital available there. Additional risk capital should allow 
investments  in  promising  innovations  with  higher  risk  premiums  and  lower  return 
expectations than in purely commercial investments. 

For  the  acceding  states,  the  Commission  will  examine  with  the  European  Bank  for 
Reconstruction and Development (EBRD) how best to utilise the dedicated financial 
instruments  which  are  currently  either  under  development  or  being  implemented  in 
the areas of climate change, water pollution and energy efficiency.32 

The  Commission  will  also  explore,  with  Member  States  and  relevant  stakeholders, 
the following measures to leverage investment in environmental technologies: 

(1) 

(2) 

(3) 

public/private  partnerships  with  public  participation  providing  the  necessary 
risk-alleviating co-investment in seed capital or warranties; 

the  better  identification  and  promotion  of  promising  new  business  niches, 
such as providers of energy services (i.e. those that provide a combination of 
energy, energy using technology, and possibly operations and maintenance of 
this  technology,  delivered  as  an  integrated  service  product  to  energy  end 
users) giving technical expertise and, at the same time, financing innovative 
projects; 

the  increased  use  of  financial  instruments  that  guarantee  the  results  of 
investments in renewables and energy efficiency technologies, such as energy 
performance  contracting,  third-party  financing  and  other  shared  savings 
contracts; 

30 
31 
32 

http://www.eib.org/i2i/en 
Shareholders are the EIB, the European Commission and members of the banking community 
for more information see Annex 4  

16 

 
 
  
 
                                                 
(4) 

(5) 

(6) 

the study of the competitiveness of eco-industries in Europe and looking into 
the role that business incubators, such as European Business and Innovation 
Centres (BICs), can play in assisting “green” start ups; 

promotion of socially and environmentally responsible investment through a 
dialogue at European and national level with private financial institutions and 
fund managers; 

support, using the relevant trade associations, to exchanges of experience and 
dissemination  of  good  practice  among  financial  institutions,  on  innovative 
financing solutions for sustainable development projects. 

There  are  also  long-term  benefits  from  exploiting  opportunities  for  integrating 
environmental  technologies  when  capital  stock  is  replaced  at  the  end  of  its  normal 
life. An example is given in the box below. These opportunities will be identified in 
close  consultation  with  stakeholders,  using,  for  example,  prospective  studies 
financed by the 6FP. 

In  the  EU-15  plus  Poland  and  the  Czech  Republic  close  to  30 %  of  the  thermal  power 
generation capacity is older than 30 years and important decisions are hence coming up on 
the new capacity to be built. These will have a major impact on the EU’s long-term ability to 
reduce  its  greenhouse  gas  and  other  emissions.  In  some  Member  States,  including  for 
example  the  UK,  as  well  as  the  Czech  Republic  and  Poland,  the  share  of  power  stations 
above this age is even higher.33 

Cohesion policy (the Structural Funds and Cohesion Fund) will also play a vital role 
in the promotion of environmental technologies, in particular in the acceding states 
when  they  are  supporting  the  implementation  of  the  body  of  Community  law.  The 
new programming period after 2006 should enhance this contribution to sustainable 
development  by  promoting  support  for  investments  in  environmental  technologies, 
albeit respecting the relevant competition and World Trade Organisation rules. 

4.2.3.  Creating incentives and removing economic barriers  

Well targeted economic incentives can be useful in helping to promote the take-up of 
environmental  technologies.  These  have  been  successfully  used  for  promoting 
energy efficiency investments in households and for investing in renewable energy. 
They  can  take  many  different  forms,  for  example,  tradable  vouchers  and  tax 
incentives. In order to ensure that such subsidies do not unduly distort competition in 
the internal market, the Commission has adopted guidelines for environmental State 
aid. However, recent experience suggests that the framework is not properly adapted 
to the increasing sophistication of investments in environmental technologies, nor to 
new forms of public/private partnership. Therefore the Commission will review the 
framework and decide on any necessary adjustments to the existing Guidelines.34 

Getting  prices  right  requires the  systematic  internalisation  of  costs  through  market-
based  instruments  (e.g.  taxes,  tax  breaks,  subsidies,  tradable  permits  and  deposit-

33 

34 

Chalmers University Power Plant Database, Department of Energy Conversion, Chalmers University of 
Technology, Sweden 
This  commitment  was  made  in  paragraph  73  of  Commission  Decision  C21/03  of  11.11.2003  on  the 
UK’s Waste and Resources Action Programme. 

17 

 
 
  
 
                                                 
refund  schemes).  If  properly  applied  they  are  the  best  way  to  reduce  pollution 
because  they  make  producers  and  consumers  bear  the  real  costs  of  their  actions  or 
change their behaviour in a cost-effective way. Moreover, price distortions have been 
identified  as  a  significant  barrier  to  environmental  technologies  during  the 
development of this Action Plan. Failure to remove them would significantly reduce 
the effectiveness of the actions proposed and thus the Action Plan’s overall impact. 
In addition, market-based instruments can also boost the markets for environmental 
services and increase the demand for public goods. 

In some cases, such as taxing externalities related to energy use, the need to ensure 
that  the  Single  Market  works  smoothly  may  mean  that  action  is  best  taken  at 
Community  level.  However,  this  Action  Plan  will  concentrate  on  promoting  the 
Open Method of Co-ordination in this area (see section 5.3). 

Environmentally-harmful  subsidies  can  be  a  major  barrier  to  the  take-up  of 
environmental  technologies,  distorting  prices  in  favour  of  a  more  polluting, 
subsidised  technology.  Where  these  distortions  occur,  their  removal  should  be 
considered,  albeit  taking  into  account  their  social  and  economic  aspects.  As 
recognised  in  the  6th  Environment  Action  Programme,  identifying  environmentally 
harmful  subsidies  is  a  first  step  towards  correcting  prices  and  reducing  subsidies’ 
negative  effects  on  the  environment.  The  Organisation  for  Economic  Co-operation 
and  Development  (OECD)  will  develop  a  framework  to  help  identify  and  measure 
them by the end of 2004. In 2005, the Commission will work together with Member 
States  and  regional  governments,  using,  as  far  as  possible,  this  methodology,  to 
identify  the  most  significant  subsidies  that  have  a  negative  impact  on  the 
environment.  Each  level  of  government  should  then  take  the  appropriate  action,  as 
quickly  as  possible,  to  remove  or  reduce  their  negative  effects,  for  example  by 
introducing  new  taxes  or  tax  incentives  combined  with  harmonised  performance 
targets (see section 4.2.1). An example of one way of doing this is given in the box 
below. 

The recently adopted Energy Taxation Directive35 will allow Member States, amongst other 
things to introduce lower rates of fuel taxation for biofuels. This tax incentive, coupled with 
the  EU  target  of  a  5.75%  share  of  biofuels  in  each  Member  State  by  2010,36  will  help  to 
secure innovation and investment in this field. 

This action will complement the broader Communication on the use of market-based 
instruments  in  environmental  protection  that  the  Commission  plans  to  produce  in 
2004. This Communication will update the 1997 Communication on environmental 
taxes and charges37 and widen its scope to include issues such as tradable permits. It 
will  analyse  the  existing  Community  rules  in  these  areas,  their  consistency  and  the 
scope for Member States to use economic instruments. 

4.2.4.  Public Procurement 

Public procurement accounts for around 16 % of the EU’s GDP, or roughly €1 450 
billion,38 and as such it represents a potentially powerful economic driver to further 

35 
36 
37 
38 

2003/96/EC, OJ L 283 of 31.10.2003 
Council Directive 2003/30/EC of 8 May 2003 as above 
COM(1997) 9 final of 26.3.1997 Green taxation: environmental taxes and charges in the single market 
Based on the GDP in 2002 

18 

 
 
  
 
                                                 
the  uptake  of  environmental  technologies.  There  is  therefore  considerable  potential 
for governments at all levels to lead by example. Member States have a key role in 
promoting  this  important  market  driver.  The  Commission  has  contributed  by 
proposing a directive requiring energy savings in each Member State39 as part of its 
climate  change  programme  and  by  developing,  in  the  context  of  IPP,  several 
initiatives40 designed to encourage procurers to make use of the many possibilities in 
existing public procurement directives.41 

During  2004  the  Commission  will  also  investigate  the  possibilities  for  promoting 
environmental  technologies  through  the  setting  of  performance-based  requirements 
in  public  procurement  procedures.  This  could  be  a  way  of  pulling  environmental 
technologies  into  the  market  place.  Buyers,  or  groups  of  buyers,  could  formulate 
technical  specifications  that  challenge  companies  to  go  beyond  the  current  best 
available  technologies.  Industry  then  knows  that  if  it  produces  such  products  it  has 
better  chances  of  winning  relevant  contracts.  This  results  in  competition  to  meet 
these criteria, thereby pulling the market upwards. This type of procurement, which 
has  sometimes  been  called  technology  procurement,  has  been  used  for  energy-
efficiency products by a number of Member States (e.g. Sweden for refrigerators and 
heat pumps). 

Furthermore, life-cycle costing needs to be promoted for long-term investments such 
as buildings and energy supply systems. For example, in the construction sector this 
would  be  expected  to  favour  environmental  technologies  as  the  often  higher 
construction  costs  of  a  more  energy-efficient  building  would,  in  the  long  term, 
usually  be  outweighed  by  the  lower  running  costs  compared  to  more  conventional 
buildings. Life-cycle costing is equally valid for private purchasing considerations. 

4.2.5.  Building  support  for  environmental  technologies  in  civil  society  –  business  and 

consumer awareness, training and education 

Societal acceptance of environmental technologies is crucial to creating a framework 
conducive to investments in environmental technologies. The challenge is to create a 
situation where environmental technologies are viewed positively by society so that 
societal attitudes do not present an unjustified barrier to investments and purchasing 
decisions.  Consumer  awareness-raising  measures  can  stimulate  demand  for  such 
technologies  by  promoting  products  and  services  whose  environmental  impacts  are 
lower. 

Consumers  should  be  aware  of  the  existence  and  benefits  of  products  (e.g.  energy-
saving  lamps)  and  services  (e.g.  energy  supply  or  transport  modes)  whose 
environmental impacts are lower than those of relevant alternatives, in order both to 
buy them and to make maximum use of their potential benefits. However, it is only 
when  such  information  becomes  widely  available,  such  as  on  the  real  costs  of  a 
product over the life-cycle, that the power of consumers can be sufficiently mobilised 

39 

40 

41 

Commission proposal for a directive on the promotion of energy end-use efficiency and energy services 
COM(2003) 739 of 8.12.2003 
A  handbook  for  public  procurers,  a  product-group  database  and  voluntary  action  plans  for  public 
procurement. 
These  possibilities  are  explained  in  detail  in  the  Commission’s  Interpretative  Communication  on  the 
Community  law  applicable  to  public  procurement  and  the  possibilities  for  integrating  environmental 
considerations – COM (2001) 274 final, 4.7.2001 

19 

 
 
  
 
                                                 
to drive the demand. Product labelling42 is best carried out at the European level in 
order  to  avoid  national  requirements  acting  as  barriers  to  the  Single  Market.  Other 
types  of  consumer  information  and  the  promotion  of  product  labels,  however,  are 
most  effective  at  national,  regional  or  local  level  where  the  information  can  be 
presented in a way that is culturally and linguistically sensitive. 

For  this  reason  this  priority  action  has  to  be  carried  out  by  national,  regional  and 
local authorities. They should create a level of awareness that ensures that consumers 
can  play  a  useful  role  in  stimulating  environmental  technologies,  notably  by 
purchasing  more  environmentally-friendly  products  and  services.  This  awareness-
raising would be helped by networking the numerous innovative local initiatives and 
projects for introducing environmental technologies in real-life settings.43 

For  business-to-business  information  flows,  more  detailed  information  is  often 
required than that given to consumers. In the context of IPP the Commission will, in 
2005, examine the role for Environmental Product Declarations in providing this. In 
addition,  environmental  management  systems,  such  as  the  Community  EMAS 
scheme,  are  also  a  useful  way  to  manage  information  and  to  increase  demand  for 
environmental technologies. Another important source of information in the context 
of sustainable production and consumption is the IPPC directive, which covers large 
industrial  and  agricultural  plants  and  requires  the  application  of  “best  available 
techniques”. The information exchange required by the directive is a key driver for 
improved  environmental  performance  as  it  involves  sector-by-sector  benchmarking 
and comprehensive screening and assessment of techniques applied. 

In  addition,  progressive  operators  within  the  business  community  are  making 
sustainable  development  operational  through  the  concept  of  Corporate  Social 
Responsibility  (CSR).  Initiatives  such  as  triple  bottom  line  reporting  (Global 
Reporting Initiative) and the UN’s Global Compact could also support investment in 
new technologies. 

In addition, training and education (such as in university curricula) is required. This 
is  particularly  relevant  for  those  who  have  the  potential,  through  their  jobs,  to 
improve  the  case  for  investment  in  environmental  technologies  (e.g.  public 
purchasers,  entrepreneurs,  maintenance  operators  and  financiers).  They  can  include 
those with influence on production, commercialisation, operation and maintenance. 

The importance of awareness-raising and training: the example of the construction sector 

Many  environmental  technologies  in  the  construction  sector  (e.g.  window  glazing)  offer  scope  for 
reducing  the  consumption  of  raw  materials,  promoting  the  reuse  and  recycling  of  construction  and 
demolition  waste  and  enhancing  energy  efficiency.  This  is  important  because  around  25 %  of  CO2 
emissions  come  from  housing.  These  could  have  a  considerable  impact  on  the  sector’s  efficiency, 
especially  in  urban  areas.  However,  many  commercialised  state-of-the-art  technologies  are  still 
poorly used because of the lack of awareness of key decision-makers (e.g. architects). Better access to 
key  information  on  environmental  technologies  through,  for  instance,  continuous  training  could 
therefore improve the sector’s environmental performance. 

The  Commission  will  promote  information  exchange  on  training  and  education  for 
procurers  and  users  of  environmental  technologies,  including  maintenance.  To  this 

42 
43 

Such as eco-labelling and energy labelling 
for instance, introducing novel sustainable local transport solutions. 

20 

 
 
  
 
                                                 
end it will also promote the possibilities for training under the European Social Fund 
(ESF)  and  the  Marie  Curie  Fellowships.  In  line  with  the  principle  of  subsidiarity, 
Member  States,  regional  authorities,  industrial  organisations  and  training  bodies 
should provide the necessary training and education. Training programmes could, for 
example, be specifically targeted at SMEs on subjects like public procurement, IPP 
or  EMAS.  This  could  come,  for  example,  through  e-learning,  re-skilling  and 
benchmarking using information and communication systems. 

Improving Market Conditions 

Action 

Who? 

When? How? 

6  Develop and agree on 

performance targets for key 
products, processes and services 
(PA4) 

Commission, 
Member States, 
EU Institutions, 
stakeholders 

2004-
2007 

IPP, eco-design of EuP, 
voluntary agreements, policy 
initiatives, regulation  

7  Mobilising financial 

instruments to share the risks of 
investing in environmental 
technologies (PA5) 

Commission, EIB, 
EBRD, financial 
sector 

2004-
2007 

European technology start up 
facility, SME guarantee 
facility, ETS Financial 
Facility, JI/CDM technical 
assistance facility, JREC 
venture capital, EIB Global 
Loan instrument, EIB 
contribution to EU Growth 
initiative, EIB Innovation 
2010 initiative 

8 

Public/private partnerships 

9 

Promote new business niches 

10  Financial instruments for 

renewables and energy efficiency 
technologies 

11  Measures in support of eco-

industries 

12  Promote socially and 

environmentally responsible 
investment 

13  Dissemination of good practices 
among financial institutions 

Commission, 
Member States, 
stakeholders 

Commission, 
Member States, 
stakeholders 

Commission, 
Member States, 
stakeholders 

Commission, 
European 
Business and 
Innovation 
Centres, Member 
States, 
stakeholders 

Commission, 
Member States, 
stakeholders 

Commission, 
Member States, 
European trade 

21 

2004-
2005 

Dialogue with relevant 
stakeholders, including 
financial institutions  

2004-
2005 

Financing innovative 
projects 

2004-
2005 

Dialogue with relevant 
stakeholders, including 
financial institutions 

2004-
2005 

Dialogue with the sector and 
financial institutions 

2004-
2005 

Dialogue with financial 
institutions 

2004-
2005 

Dialogue with financial 
institutions  

 
 
  
 
associations 

14 

Identification of opportunities to 
integrate environmental 
technologies when capital stock is 
replaced 

Commission, 
Member States, 
stakeholders 

2004-
2005 

FP6 prospective studies 

15  Review operational criteria of the 

Structural Funds 

Commission, 
Council, 
European 
Parliament 

2005 

Structural Fund 
programming after 2006 

16  Review state aid guidelines 

(PA6) 

Commission and 
Member States 

2004-
2007 

Guidelines for environmental 
State aid 

17  Encourage systematic 

internalisation of costs through 
market-based instruments 

18  Review environmentally-
harmful subsidies (PA7) 

19  Encourage procurement of 

environmental technologies 
(PA8) 

20  Life cycle costing promotion 

From 
2004 

2004-
2005 

Open Method of co-
ordination, Communication 
on environmental taxes and 
charges 

Communication on the use of 
market-based instruments 
and subsidies, in particular 
based on OECD report 

From 
2004 

Directive on energy savings, 
IPP initiatives  

Commission, 
Member States, 
regional 
governments 

Commission and 
Member States, 
regional 
governments 

Commission, 
Member States, 
National and local 
authorities, 
business 

Commission, 
Member States, 
National and local 
authorities 

From 
2004 

Guidelines for procurement 
using Life-cycle costing 
approach, making use of the 
forthcoming handbook on 
greener public procurement, 
where appropriate 

21 

Investigation of technology 
procurement 

Commission, 
Member States 

2004 

Report 

22  Raise business and consumer 

awareness (PA9) 

23  Provision of targeted training 

(PA10) 

2004-
2005 

Networking of innovative 
local initiatives, IPP product 
declarations, support to CSR 
related initiatives 

2004-
2007 

Information exchange, 
national and regional training 
strategies, ESF, Marie Curie 
Fellowships 

Commission, 
National, regional 
and local 
authorities, trade 
associations, 
NGOs 

Commission, 
Member States, 
regional and local 
authorities, 
industry 
organisations, 
training bodies 

22 

 
 
  
 
4.3. 

Acting globally 

Investment  in  environmental  technologies  has  the  potential  not  only  to  increase 
employment  and  economic  growth  within  the  EU,  but  also  to  promote  sustainable 
development at the global level, particularly in developing countries. With economic 
growth,  addressing  detrimental  social  and  environmental  impacts  from  production 
activities is becoming increasingly urgent in many developing countries. At the same 
time,  environmental  technologies  can  promote  innovation  and  competitiveness,  as 
well  as  decoupling  economic  growth  from  environmental  degradation,  by  leap-
frogging  traditional,  polluting  and  resource-intensive  production  patterns  and 
switching to increased eco-efficiency in the use of natural resources.  

thus  play  an 

important  role 

technologies  can 

in  achieving 
Environmental 
internationally  agreed  development  goals.  The  implementation  at  national  level  of 
multilateral  environmental  agreements  and  the  World  Summit  on  Sustainable 
for 
Development  commitments 
environmental technologies in developing countries. However, developing countries 
face major challenges in attracting, using or developing environmental technologies, 
including  a  lack  of  human  and  financial  resources.  In  order  to  address  these 
challenges, both national action and international cooperation are needed. 

is  also  generating  an 

increasing  demand 

4.3.1.  Promotion of environmental technologies in Developing Countries 

transparent  and  predictable 

Developing  countries  themselves  have  a  key  role  to  play  by  ensuring  good 
governance, 
including 
environmental regulations and protecting intellectual property rights. They also need 
to improve education and training policies, in order to develop the capability of local 
workers to adapt technologies to upgrade them and eventually to reach a higher grade 
of technological autonomy. 

frameworks, 

regulatory 

Several mechanisms are being used at EU level to support the transfer and uptake of 
environmental  technologies.  These  include,  in  particular,  science  and  technology 
(S&T) agreements. For example, the 6FP opens many areas of activity to developing 
countries  and  should  make  it  easier  for  them  to  collaborate  on  developing  suitable 
technologies to meet their needs. 

The potential of science and technology agreements: the example of wind energy 

Helped by public support, wind energy enjoys a remarkably fast deployment rate in the EU and this 
could  be  replicated  in  other countries.  The  FP-funded  CDMED  (CDM  for  the  Mediterranean area) 
and MED2010 projects(large scale integration of solar and wind power in Mediterranean countries) 
showed  that  the  CDM  mechanism  could  play  a  positive  and  important  role  in  developing  the  wind 
energy  market  in  the  Mediterranean  region.  The  installation  potentials  in  four  Mediterranean 
countries are as follows: Morocco (6,000 MW), Tunisia (1,000 MW), Egypt (10,000 MW) and Turkey 
(10,000 MW).  

Development co-operation can also play an important role in encouraging the use of 
environmental technology, such as through the Cotonou agreement. Although direct 
support  for  industry  is  not  currently  included  among  the  priority  sectors  of  the 
Community  Development  Policy  adopted  by  the  Commission  and  the  Council  in 
2000, technology innovation and upgrading can be one of the components of actions 
in areas like support for structural adjustment, institution building and promotion of 
trade. 

23 

 
 
  
 
The uptake of environmental technologies needs to be addressed in 2004 as part of 
the mid-term reviews of the country and regional strategy papers. Similarly, existing 
programmes  like  Asia  Pro-Eco,  Asia  Urban  and  similar  schemes  in  Latin  America 
must be reviewed with the aim of improving their effectiveness.  

Three  initiatives  launched  by  the  EU  in  Johannesburg  will  also  be  important  in 
promoting  the  diffusion  of  environmental  technologies.  They  will  be  delivered 
through multi-stakeholder partnerships involving Member States, third countries, the 
EIB, international institutions, civil society and the private sector. 

Johannesburg Initiatives involving environmental technologies 

The  Water  Initiative  aims  to  provide  clean  drinking  water  and  sanitation  with  a  view  to 
integrated  water  resources 
reducing  poverty.  This  requires  better  governance  and 
management, 
improved  coordination  and 
trans-boundary  waters,  and 
development of additional funding mechanisms. The Commission has proposed creating an 
ACP-EU Water Facility, amounting to €1 billion. A number of technologies and processes 
developed in the EU could be harnessed to deliver on these objectives. 

including  of 

The  Energy  Initiative  aims  to  create  the  conditions  necessary  for  developing  countries  to 
achieve  their  national  economic,  social  and  environmental  objectives,  in  particular  by 
maximising energy efficiency, including the more efficient use of fossil fuels and traditional 
biomass, and increasing the use of renewable energy. It has a multi-stakeholder approach and 
focuses on achieving poverty eradication and sustainable development by improving access 
to adequate, affordable and sustainable energy services.  

The EU-led Johannesburg Renewable Energy Coalition is composed of 82 countries who 
have agreed to set targets and timeframes for increasing the share of renewable energies in 
their  overall energy  mix,  thus  going  beyond  the  commitments  in  the  Johannesburg  Plan of 
Implementation. There will be a considerable need for environmental technologies in order 
to boost the share of renewable energies in participating developing countries. 

At  multilateral  level,  all  major  international  environmental  agreements  include 
provisions 
capacity  building.  The 
implementation of such provisions needs to be supported under existing instruments, 
including the Global Environment Facility. 

technology 

concerning 

transfer 

and 

The  CDM  and  JI  under  the  Kyoto  Protocol  offer  great  potential  for  fostering 
technology  development  in  developing  countries,  particularly  through  privately 
funded  investment  projects  and  public/private  partnerships.  The  EIB’s  new 
Dedicated  Facility  and  Technical  Assistance  Facility  will  play  a  supportive  role  by 
providing  funding  for  investments  in  cleaner  technologies  in  the  EU  or  JI/CDM 
projects outside the EU. 

Work  is  also  ongoing  under  the  Convention  on  Biological  Diversity  (CBD).  A 
programme  on  technology  transfer  is  currently  being  developed,  which  proposes 
upgrading  the  Biodiversity  Clearing  House  into  a  facilitator  of  technology  transfer, 
for example of remote sensing equipment or database software. 

4.3.2.  Diffusion of environmental technologies through responsible investment and trade 

Increasing diffusion and use of environmental technologies is of course not possible 
by government action alone. The private sector has a key role to play. In particular, 
foreign  direct  investment  (FDI)  is  a  privileged  channel  for  technology  transfer  to 

24 

 
 
  
 
developing  countries  and  countries  in  economic  transition.  FDI  generally  provides 
recipient countries not only with a whole package of technologies (from equipment 
to training of workers) but also with knowledge and expertise.  

The  OECD  guidelines  on Multinational Enterprises (MNEs) represent a useful step 
towards  enhanced  investors’  responsibilities  when  operating  abroad.  Among  other 
aspects,  these  Guidelines  encourage  MNEs  “to  perform  science  and  technology 
development  work  in  host  Countries”,  to  grant  licences  “on  reasonable  terms  and 
conditions and in a manner that contributes to the long-term development prospects 
of the host country”, to adopt “practices that permit the transfer and rapid diffusion 
of technology and know-how” and to “adopt technologies and operating procedures 
in  all  parts  of  the  enterprise  that  reflect  standards  concerning  environmental 
performance in the best performing part of the enterprise”.  

It is also important to promote environmental technologies by influencing, within the 
limits  of  their  mandate,  the  lending  policies  of  International  Financial  Institutions, 
e.g.  EBRD,  EIB  and  World  Bank,  to  which  Member  States  contribute.  Similarly, 
Export  Credit  Agencies  could  be  stimulated  to  make  further  efforts  to  consider 
environmental  aspects.  The  recent  adoption  of  the  OECD  Recommendation  on 
Common  Approaches  on  Environment  and  Officially  Supported  Export  Credits, 
which  aims  to  integrate  environmental  considerations  into  export  credits  policies, 
represents  a  significant  step  forward.  Export  Credit  Agencies  can  play  a  role  in 
promoting  sustainable  development  and  be  a  driver  for  change.  This  could  be 
particularly  important  in  areas  such  as  renewable  energies.  The  Commission  will 
examine  the  issue  with  the  Member  States  with  a  view  to  promoting  action  in  the 
OECD in 2004. 

International trade is another important vehicle for promoting the diffusion and use 
of environmental technologies. Further liberalisation of – and removal of obstacles to 
– trade in environmental goods and services, whether at the multilateral level through 
the  Doha  Development  Agenda  negotiations  or  through  regional/bilateral  trade 
agreements,  can  greatly  contribute  to  fostering  the  use  and  dissemination  of 
environmental technologies. 

The  environment  technology  dimension  should  be  given  more  attention  in  trade-
related technical assistance/capacity-building activities. This is particularly necessary 
in areas such as agriculture where research institutions supported by public and non-
commercial  organisations  are  a  key  source  for  technology  development  and 
technology diffusion in developing countries, and countries in economic transition. 

The  role  of  export  promotion  networks  and  co-operation  between  national  export 
promotion  bodies  need  to  be  expanded  in  order  to  promote  trade  in  environmental 
goods and services, in particular where the extra-EU market is large, and where EU 
companies  have  a  competitive  edge.  Work  by  the  European  Trade  Promotion 
Organisation  (ETPO)  could  be  useful  in  achieving  this  objective.  Similarly,  the 
Commission will support work by partners in the Sustainable Trade and Innovation 
Centre  (STIC)  to  foster  co-operation  in  environmental  technologies,  stakeholder 
networks, partnerships and twinning arrangements between European and developing 
country companies. 

Acting Globally 

25 

 
 
  
 
Action 

Who? 

When? How? 

2004-
2007 

2004-
2007 

Commission, 
Member States, 
developing 
countries, EIB, 
international 
institutions, civil 
society, private 
sector 

Commission, 
Member States, 
ETPO, STIC, 
EBRD, EIB, 
private sector, 
World Bank, 
export credit 
agencies, OECD 

S&T Agreements, 
Development co-operation 
and international agreements, 
country strategies, Regional 
technology centres, Kyoto 
mechanisms, WSSD 
Initiatives, Global 
Environment Facility (GEF), 
Biodiversity Clearing House, 
EIB facilities 

OECD guidelines on 
multinational enterprises, 
OECD Recommendation on 
export credits, Doha 
Development Agenda, 
regional/bilateral trade 
agreements 

24  Promotion of environmental 
technologies in Developing 
Countries 

25  Promoting responsible 

investments in and use of 
environmental technologies 
in developing countries and 
countries in economic transition 
(PA11) 

5. 

MOVING FORWARD 

5.1. 

Regular Review 

This Action Plan and its implementation will have to be regularly reviewed, not just 
because  of  the  continual  developments  in  environmental  technologies,  but  also  to 
refine its measures. The Commission will closely monitor the implementation of the 
Plan  and  will  report  every  two  years  to  the  European  Council  and  the  European 
Parliament, including on any need for revision. 

5.2. 

European Panel on Environmental Technologies 

Fostering  the  uptake  of  environmental  technologies  requires  active  support  from 
many  stakeholders  at  the  European  level.  Many  ongoing  initiatives  exist  in  which 
researchers,  business  and  other  actors  exchange  information  and  develop  concrete 
initiatives. The Commission will explore how best to bring together these initiatives 
and  actors  in  a  European  Panel  on  Environmental  Technologies  to  improve  the 
information flow between different actors to enable cross-fertilisation and joined-up 
action.  The  Panel  will  also  help  the  Commission  in  implementing  and  further 
developing this Action Plan. 

5.3. 

Open Method of Co-ordination 

As well as taking action at European level, many of the actions in this plan need to 
be  developed  and  undertaken  by  Member  States  or  by  other  authorities  which  are 
even closer to the citizen. Considerable experience of these actions already exists in 
many  Member  States  and  hence  there  is  scope  for  co-operation  and  sharing  of 
information on best practice. Examples of where this could be particularly valuable 
include: 

– 

use of economic instruments at national and sub-national level; 

26 

 
 
  
 
– 

– 

consumer awareness-raising measures; 

training  of  key  operators,  such  as  entrepreneurs,  maintenance  workers  and 
public purchasers; and 

– 

export promotion activities. 

Given  the  importance  of  this  Action  Plan  in  the  context  of  the  Lisbon  Process,  the 
Commission  considers  the  “Open  Method  of  Co-ordination”  to  be  the  most 
appropriate  way  of  moving  forward.  This  method  for  implementing  the  Lisbon 
Strategy  has  been  used  in  several  different  areas,  including  in  social,  employment 
and research policy, and bearing in mind the need to avoid unnecessary bureaucracy, 
it is suitable for spreading best practice and helping Member States to develop their 
own policies and actions promoting environmental technologies. The box below sets 
out some of the areas where the Open Method of Co-ordination could be used to help 
promote environmental technologies. 

Areas  where  the  Open  Method  of  Co-ordination  could  assist  in  promoting  environmental 
technologies 

(1) 

(2) 

(3) 

exchanging  information  on  best  practice  -  Identifying  and  exchanging  information 
on best practice will raise stakeholder awareness at national, regional and local level. 
It will also highlight particularly effective combinations of measures; 

where appropriate, establishing indicators to compare best practice - Indicators will 
help to  monitor progress towards the overall goal and to enable  benchmarking and 
peer review; and  

where appropriate, establishing guidelines and timetables for the action programme 
for  all  the  EU  -  This  will  allow  a  common  view  to  be  formed  of  how  to  work 
together towards the overall objective.  

Action 

Who? 

When? How? 

Moving Forward 

26  Regular Review of the Action 

Commission 

Plan 

27  European Panel on Environmental 

Technologies 

Commission and 
stakeholders 

28  Open Method of Co-ordination 

Member States, 
Commission 

Report to European Council 
and European Parliament 

2006, 
then 
every 2 
years 

2004-5  Analysis of existing 

initiatives, exchange of 
information 

2004-7  Exchange of best practice, 

developing indicators, 
establishing guidelines and 
timetables. 

6. 

CONCLUSION: 

The  Commission  is  committed  to  the  implementation  of  this  Action  Plan  and  asks 
Member States, the European Parliament and the European Council to: 

27 

 
 
  
 
– 

– 

– 

endorse this Plan and contribute to its rapid implementation; 

request  the  EIB  Group  and  the  EBRD  to  broaden  the  range  of  financing 
instruments,  including  venture  capital,  which  can  be  effectively  used  to 
promote environmental technologies; and 

initiate  the  Open  Method  of  Co-ordination  to  assist  in  implementing  the 
specific actions in the Plan. 

28 

 
 
  
 
ANNEX I: The Development of ETAP 

The  European  Council,  meeting  in  Stockholm  in  March  2001,  announced  that  it 
would review the contribution that environmental technology can make to promoting 
growth and employment in Spring 2002. The Commission agreed to prepare a report 
on how this could be done. The report, “Environmental Technology for Sustainable 
Development”,  was  adopted  by  the  Commission  in  March  2002.  In  it  the 
Commission suggested that an action plan be developed with stakeholders to tackle 
the  obstacles  to  the  development,  take-up  and  use  of  environmental  technologies. 
The European Council agreed to this proposal. 

Following  this,  the  Commission  held  a  conference  on  environmental  technology  as 
part  of  Green  Week  2002.  This,  and  further  stakeholder  consultations,  led  to  the 
publication  of  a  Commission  Communication,  “Developing  an  action  plan  for 
environmental technology”, in March 2003. This sought to deepen discussion on the 
content  of  an  Action  Plan  by  setting  out  a  number  of  measures  and  questions  as  a 
basis for discussions. Around 70 contributions were received from a very wide range 
of stakeholders. These were examined in detail by the Commission’s services.  

In general, there was a broad agreement on the importance of the issues described in 
the  Commission’s  Communication.  Stakeholders  felt  it  was  important  to  consider 
both  commercial  and  advanced  technologies,  as  well  as  having  a  special  focus  on 
cross-cutting technologies such as ICTs. Some contributors would have preferred  a 
more  specific  definition  of  environmental  technologies,  while  others  were  content 
with  the  definition  in  the  Communication.  Of  the  barriers  to  the  development  of 
environmental technologies, the most significant were considered to be in the area of 
the 
market  penetration  and  development.  There  was  general  support  for 
establishment of a common EU framework for environmental technologies made up 
of both supply-side and demand-driven measures. 

The  different  comments  from  stakeholders  showed  that  while  they  may  have 
particular  preferences  about  the  relative  emphasis  given  to  different  measures  and 
approaches, there is general agreement on several points: 

– 

– 

– 

– 

– 

– 

– 

– 

it needs to be based on a long-term vision; 

the internalisation of external environmental costs is essential; 

existing legislation is an important driver and it needs to be enforced; 

a  mixture  of  market-based  incentives,  including  sector-specific  voluntary 
agreements, and strengthened legislation is required; 

concrete “performance” targets are needed; 

changes to Structural Funds and public procurement rules need to be made to 
assist environmental technologies; 

simplified approval and licensing procedures would be advantageous; 

continual R&D is required, in particular for the acceding states and for SMEs, 
along with large-scale demonstration; 

29 

 
 
  
 
– 

– 

technology transfer is needed; 

education and training need to be improved. 

In  addition,  four  issue  groups  were  established  to  allow  for  a  problem-solving 
approach  and  also  to  facilitate  stakeholder  involvement.  These  were  on  climate 
change, soil protection, water and sustainable production and consumption. Each of 
these  groups  produced  a  report  which  reviewed  the  barriers  to  the  adoption  of 
environmental  technologies  in  these  areas  and  suggested  possible  measures  that 
could be contained with the Action Plan.44 This included looking at particular pieces 
of  legislation  and  policy  initiatives.  For  example,  for  climate  change,  the  clean 
vehicle  initiative,  the  combined  heat  and  power  action  plan,  the  renewable  energy 
strategy, the EuP proposal, and the Common Transport Policy were considered and 
for soil protection, the Thematic Strategy on soil protection45 and the reform of the 
Common Agricultural Policy46 were covered. 

44 

45 

46 

Information  on  these  groups  is  available  at  http://europa.eu.int/comm/environment/etap  .  See  also, 
European  Commission  (IPTS)  Promoting  environmental  technologies:  sectoral  analysis,  barriers  and 
measures  –  a  report  from  the  Sustainable  Production  and  Consumption  Issue  Group  to  the  EU 
Environmental 
see 
Action 
Technologies 
http://www.jrc.es/home/publications/publication.cfm?pub=1168 
COM(2002) 179 final of 16.4.2002 Communication from the Commission to the Council, the European 
Parliament,  the  Economic  and  Social  Committee  and  the  Committee  of  the  Regions:  Towards  a 
Thematic Strategy for Soil Protection 
http://europa.eu.int/comm/environment/agriculture/index.htm and 
http://europa.eu.int/comm/agriculture/mtr/index_en.htm 

(ETAP), 

Plan 

30 

 
 
  
 
                                                 
ANNEX II: The Barriers to Environmental Technologies 

Barriers  to  the  uptake  of  environmental  technologies  are  numerous.  The  most 
relevant are described in the following subsections. 

Economic barriers 

Market  prices  should  provide  consumers  with  information  on  the  economic,  social 
and  environmental  costs  of  products  and  services.  However,  too  often,  markets 
simply reflect the direct economic costs and not the costs of environmental pollution 
(such  as  health  care  costs  from  urban  air  pollution).  This  market  failure  leads  to 
systematic  underinvestment  in  environmental  technologies,  especially  from  firms 
that cannot afford to be charitable in a competitive market. At times, this problem is 
compounded by government interventions that further bias markets, such as subsidies 
to  fossil  fuel  production  and  consumption,  which  reduce  the  relative  attraction  of 
renewable energy. 

Investors  are  also  put  off  innovative  technologies  by  up-front  costs,  even  if  the 
technologies would ultimately prove economically beneficial. Firstly, switching to an 
environmental  technology  can  be  costly  in  the  short  run  if  new  infrastructure  is 
needed,  such  as  hydrogen  distribution  networks  for  hydrogen-powered  vehicles. 
Secondly,  costs  decreases  can  be  the  result  of  factors  such  as  economies  of  scale, 
learning  by  doing  and  improved  design.  However,  the  benefits  from  ‘learning  by 
doing’ do not necessarily accrue to the first mover. 

Environmental  technologies  are  often  perceived  as  risky  investments.  This  can  be 
both because they are often subject to changing political priorities and because they 
are often not seen as being part of the investor’s core business. The latter has been 
the  case  in  the  energy  sector,  where  investments  in  renewable  energies  are  often 
outside  the  core  business  and  hence  require  a  larger  rate  of  return  to  become 
attractive.  More  generally,  the  lack  of  adequate  venture  capital,  in  particular  for 
SMEs and start-ups, represents an additional barrier to the rapid market development 
of environmental technologies. 

Regulatory barriers and standardisation 

Smart  legislation  can  act  as  a  stimulus  to  environmental  technologies  by  requiring 
their  development  and  adoption.  This  is  the  case,  for  example,  with  the  IPPC 
directive. However, where legislation is unclear, it can lead to market uncertainty and 
reduce the incentives to invest. An example of this is the definition of waste recovery 
and  disposal  within  the  Waste  Framework  Directive.47  Legislation  setting  limit 
values  can  also  limit  innovation  by  removing  incentives  to  go  beyond  them. 
Legislation  containing  overly  detailed  technical  specifications  also  reduces  the 
latitude  for  innovation,  thereby  discouraging  it.  The  lack  of  stable  legislation  also 
deters investors. 

Divergent  Member  State  legislation  can  also  act  as  a  barrier  to  environmental 
technologies  by  fragmenting  the  Single  Market  and  making  market  penetration 
subject to different requirements in different Member States. This reduces the size of 

47 

Council Directive 75/442/EC on waste, as amended, OJ L 194, 25.7.1975, p. 39 

31 

 
 
  
 
                                                 
the potential market for these technologies and acts as a barrier to their diffusion and 
uptake.  

Poorly set standards may also act as a barrier, by favouring one technology over an 
environmental  technology.  On  the  other  hand,  the  absence  of  standards  may  mean 
that environmental technologies are not taken up, because there is no certainty that 
they meet particular performance requirements. 

Developing  countries  have  a  key  role  to  play  by  ensuring  good  governance, 
transparent and predictable regulatory frameworks, including protection and effective 
enforcement of Intellectual Property Rights (IPRs). IPRs are fundamental to making 
technological  knowledge  accessible  and  securing  business  partners  and  foreign 
investors. 

Technological barriers 

Environmental  technologies,  like  other  technologies,  require  R&D  to  become 
competitive. However, this R&D support is often not forthcoming. For example, it is 
well  known  that  R&D  funding  for  renewable  energies  is  significantly  lower  than 
their  political  importance  would  imply.48  In  part  this  relates  to  market  prices  being 
biased  against  environmentally-friendly  technologies,  to  the  detriment  of  private 
R&D funding. In addition, public R&D may not be well enough targeted and fails to 
promote adequate co-operation between universities, research centres and industries.  

Furthermore, the linkages are often poor between financing programmes for research 
and innovation and programmes for demonstration and diffusion. This hinders their 
progress from inception to market. 

Diffusion barriers 

The biggest barrier to diffusion is lack of information about potential environmental 
technologies. Without knowledge of the costs and benefits throughout the life-cycle 
potential customers can not be expected to buy or use the technologies.  

In  addition,  there  is  often  too  little  knowledge  about  the  socio-economic  issues 
influencing  the  uptake  of  environmental  technologies.  For  example,  lack  of  public 
acceptance  has  acted  as  a  barrier  to  the  use  of  green  biotechnology  products  in 
Europe. 

Even where a technology could be competitive, it may be difficult to disseminate it 
because  distribution  channels  for  new  technologies  are  not  as  good  as  those  for 
established technologies. 

The  lack  of  adequately  trained  staff  is  also  an  issue:  insufficiently  trained  key 
maintenance  staff.  Where  a  technology  is  new,  it  requires  training  for  it  to  be 
installed  and  maintained  properly.  For  example,  in  the  construction  sector  the 
diffusion  of  the  most  advanced  energy  saving  technologies  is  dependent  on  small 
local fitters and repair companies. 

48 

International Energy Agency data suggest that less than 10% of the IEA Energy R&D budgets are spent 
on the different renewable energy technologies. 

32 

 
 
  
 
                                                 
The  preponderance  of  SMEs  as  a  target  audience  for  environmental  technologies 
compounds  the  difficulties  of  addressing  the  aforementioned  factors.  SMEs  tend  to 
have more difficulties than larger firms in accessing finance and information that is 
not linked to their core business. 

Finally, these barriers are likely to be particular challenges in the acceding states and 
further afield. 

33 

 
 
  
 
ANNEX III: Examples of Good Practice 

The following examples illustrate actions similar to those in the Action Plan, which 
are already implemented in some Member States, at EU level or outside Europe. 

Integrated policy approaches 

Since 1994, the regional energy agency “O.Ö. Energiesparverband” of Upper Austria 
has  been  implementing  an  Energy  Action  Plan  designed  to  promote  energy 
efficiency.  In  the  period  1994-1999,  it  achieved  30 %  renewable  energy  take-up 
(14 % hydro, 14 % biomass, 2 % solar), a 30 % reduction of the energy consumption 
in new housing and the creation of 15 000 new jobs. During the period 2000-2010, 
the objective is to double the share of biomass and solar energy, and to increase the 
overall energy efficiency of the Region by 10 %. 

New  energy-efficient  environmental  technologies  are  being  supported  via  an 
integrated  approach  that  puts  together  demand-side  measures  (e.g.  information  and 
awareness raising, provision of energy advice, financial support, legal measures) and 
supply-side  measures  (e.g.  training  and  education,  standardisation  and  quality 
control, R&D programmes, networking and co-operation). 

One of the renewable energy technologies promoted in this plan is wood pellets and 
wood chip heating using advanced and environmentally-friendly installations. There 
are more than 100 municipalities that using biomass for heating with 15 000 biomass 
heating installations and 200 district heating plants. 

Public/private research and development programmes 

In  the  United  Kingdom,  a  Faraday  Partnership  is  an  alliance  of  organisations  and 
institutions,  which  can  include  research  and  technology  organisations,  universities, 
professional  institutes,  trade  associations  and  firms,  co-operating  in  research, 
development, transfer and exploitation of new and improved science and technology. 
Faraday Partnerships cover a wide range of disciplines, including one called FIRST 
which  facilitates  research,  training  and  technology  transfer  for  the  remediation  of 
polluted  land  and  water  by  biological  as  well  as  physical  and  chemical  methods, 
especially  in  the  subsurface  environment.  The  partners  of  the  project  develop  and 
perform  multidisciplinary  collaborative  R&D  projects  with  industry,  with  emphasis 
on  industrially  focused  market-driven  projects.  Moreover,  industrially  focused 
training is a major part of the activities, and another major aim is to generate  new, 
technologically derived business through the creation of intellectual property. 

The  “Sustainable  Enterprise”  (SUSPRISE)  project,  recently  launched  under  the 
ERA-NET  and  financed  by  6th  EU  FP,  aims  to  strengthen  efforts  to  achieve 
sustainable  industrial  development  by  enhancing  European  co-ordination  and  co-
operation of national sustainability RTD programmes. The project will: 

•  set  up  a  continuous,  structured  and  systematic  exchange  of  national  programme 

information; 

•  benchmark,  co-ordinate  and  synchronise  national  programme  features  towards  a 
common  programme  design  and  towards  a  common  programme  implementation 
strategy for industry and research infrastructure; 

34 

 
 
  
 
•  identify and analyse aspects that encourage or hinder mutual opening of national 

programmes; 

•  establish a framework for a joint programme. 

Project deliverables include a common knowledge base on the state of the art of the 
programmes involved, common programme design cases (evaluation, monitoring and 
project  criteria),  common  target  group  implementation  cases  (sectorial  RTD,  cross-
cutting RTD and non-technical), a high-level integration conference and a framework 
for a joint programme, including an ex-ante evaluation.  

Dissemination 

Established by the European Commission in 1995, the key task of the 70 Innovation 
Relay  Centres  (IRCs)  located  throughout  Europe  is  to  facilitate  the  transfer  of 
innovative  technologies  to  and  from  European  companies  or  research  departments 
(see  for  further  information:  http://irc.cordis.lu/ircnetwork/faq.cfm).  Over  the  past 
years, the IRC network has become a leading European network for the promotion of 
technology  partnerships  and  transfer,  mainly  between  SMEs.  The  IRCs  are 
innovation support service providers mainly hosted by public organisations such as 
university  technology  centres,  chambers  of  commerce,  regional  development 
agencies or national innovation agencies. The IRCs have an active Thematic Group 
“Environment”  comprised  of  representatives  of  some  29  IRCs  in  14  countries  and 
which  is  specifically  concerned  with  the  transfer  of  environmental  technologies. 
Thanks  to  their  specific  strengths  (e.g.  their  closeness  to  the  marketplace,  their 
integration  in  the  technology  landscape  in  the  regions  of  Europe  in  which  they  are 
located and their intensive contacts with local enterprises, primarily SMEs) the IRCs 
can  play  a  valuable  role  in  implementing  ETAP,  particularly  in  the  areas  of 
information provision, dissemination and awareness-raising.  

Demonstration projects 

The  EU  has  allocated  approximately  €300  million  to  the  LIFE-Environment 
programme for the period 2000-2004. The rate of Community co-financing can be up 
to  30 %  for  projects  generating  substantial  net  revenue,  50 %  in  other  cases.  The 
purpose  of  the  programme  is  to  bridge  the  gap  between  research  and  development 
results and their large-scale application. To this end, demonstration projects based on 
the  results  of  projects  which  have  been  supported  under  past  or  ongoing 
technological  research  and  development  programmes  are  encouraged.  The 
dissemination of results is an essential element of the programme. 

Example of a successful LIFE-project: an Austrian semiconductor producer supplies 
diodes  used  in  fluorescent  light  tubes,  computers,  monitors,  television  sets  and 
electronic automobile components. The processes to produce diodes involve the use 
of sintered molybdenum pins. Before using them in the process, the oxide layer on 
these  pins  must  be  removed.  In  the  past,  this  was  done  by  etching  with  nitric, 
sulphuric  and  hydrochloric  acid  and  then  washing.  The  waste  water,  which  had  a 
very high molybdenum content, was discharged into a local river, and subsequently 
into the Danube. In this LIFE project, it was demonstrated that the etching could be 
replaced  by  a  new  coating  process  (pre-soldering)  prior  to  manufacturing  the  pins. 
The new process is easily transferable and is now being set up at a similar plant in 
Hungary. 

35 

 
 
  
 
Public procurement 

The Environmental Association of Vorarlberg represents the environmental interests 
of 96 municipalities in this province of Austria. Through an ecological procurement 
service,  a  common  tendering  and  procurement  of  products  and  services  to  using 
ecological and economic criteria is offered to the municipalities. Expert teams draw 
up tenders and place basic agreements with the “best bidder”. “Ecology” is included 
in  the  award  criteria  (apart  from  price  and  other  criteria)  using  “environmental 
specification sheets” which consider criteria such as durability, energy consumption, 
construction and choice of material, packaging and information. 

Provision of information 

The  Internet  Portal  “Cleaner  Production  Germany”49  is  hosted  by  the  Federal 
Environmental  Agency  and  provides  comprehensive,  in-depth  information  on  the 
performance  of  German  environmental  technologies  and  services.  The  portal  is 
especially  useful  for  establishing  contacts  between  German  and  international 
operators active in the field of cleaner production. 

The system provides information on: 

•  environmental  technologies  in  Germany  giving  an  overview  of  the  tools  used  in 
Germany  for  operational  and  industrial  environmental  protection  as  well  for  the 
promotion  of  research.  Directories  of  key  operators  in  business,  research  and 
management are also available; 

•  a large number of eco-technological projects aiming to improve the environmental 
performance of production methods and processes. The visitor can access project 
contents and results, as well as additional background information. 

The European GreenLight programme is an ongoing voluntary programme whereby 
private  and  public  organisations  (referred  to  as  Partners)  commit  to  adopting 
advanced technologies to reduced their lighting consumption. In return they benefit 
from large energy and costs savings as well as receiving broad public recognition for 
their effort in protecting the environment.  

A  network  on  contacts  points  in  26  countries  promote  the  GreenLight  programme. 
The  number  of  GreenLight  Partners  is  steadily  increasing  as  awareness  of  the 
programme increases. More than a hundred public and private organisations have so 
far signed the GreenLight partnership, among which major players such as cities of 
Zurich,  Lyon,  Hamburg,  Turin,  large  multinational  companies  as  well  as  SMEs. 
These organisations have changed the way they make decisions about investments in 
energy-efficiency.  They  now  use  up-to-date  information  and  Life-Cycle  Cost 
analysis,  going  for  the  most  cost-effective  lighting  solutions  using  energy-efficient 
light  sources,  electronic  ballasts,  lighting  control  systems,  and  proper  design  and 
maintenance. 

49 

http://www.cleaner-production.de 

36 

 
 
  
 
                                                 
The  Programme  has  shown  that  such  an  initiative  can  further  the  Energy  Service 
Companies  (ESCOs)  business.  Many  ESCOs  operating  in  the  lighting  field  have 
emerged and have become GreenLight endorsers. 

information  resources 

While  the  Commission  does  not  provide  funds  for  the  lighting  upgrades,  it  does 
provide  a  comprehensive  range  of 
to  help  address 
implementation  barriers,  including  databanks  of  lighting  equipment,  lighting 
contractors,  and  financing  sources,  as  well  as  tools  for  preparing  and  analysing 
lighting upgrades. Through advertisements, articles, a GreenLight Partners logo and 
media  events,  the  Commission  provides  public  recognition  for  the  GreenLight 
programme  and  its  Partners.  However  most  of  the  effort  is  paid  for  or  provided  by 
the partners themselves. 

Training 

Through the Norwegian Society of Chartered Engineers, the Norwegian government 
finances the transfer of know-how programmes on cleaner production strategies and 
assessment  to  several  Central  and  Eastern  European  countries  and  Newly 
Independent States.  These  programmes  are designed  to  facilitate  implementation  of 
economically  profitable  and  environmentally  beneficial  restructuring  of  industrial 
processes.  Cleaner  production  assessments  have  been  carried  out  in  100-500 
production companies in each country involved over a period of one to six years. In 
addition, 200-800 qualified “cleaner production advisors” have been trained in each 
country.  Specific  goals  are  to  educate  a  minimum  of  35-60  authorised  local 
instructors  in  the  first  one  to  two  programme  cycles,  and  to  educate  200-750 
authorised  advisors  during  the  following  two  to  five  years  (to  be  conducted  by 
authorised local advisors). The programmes combine classroom studies, group work, 
in-company project work and in-company advice. Programmes have been established 
in the Czech Republic, Poland, Slovakia, Lithuania and the Russian Federation. 

Promoting environmental technologies on world markets 

It is essential from a climate change perspective that, complementary to ‘domestic’ 
EU  actions,  substantial  efforts  of  the  developed  world  are  geared  towards  assisting 
and supporting developing nations towards sustainable development. Within the UN 
Framework  Convention  on  Climate  Change,  several  funds  have  been  established. 
There  is  currently  a  portfolio  of  projects  totalling  more  than  €9  billion  in  70 
countries. In addition, the Kyoto Protocol already includes the CDM as an instrument 
to  promote  technology  transfer  and  sustainable  development  in  “non-Annex I” 
countries. CDM projects are primarily driven by the private sector. 

The Commission has proposed linking the CDM and JI to the EU Emissions trading 
scheme, thereby providing a stronger demand from European businesses for emission 
reduction through CDM projects.  

At  the  Johannesburg  summit,  several  initiatives  have  been  taken  in  the  field  of 
energy,  in  particular  the  EU-Energy  Initiative,  the  JREC  and  Energy  Efficiency 
Partnership and the Mediterranean Renewable Energy Partnership. 

37 

 
 
  
 
In March 2003, the European Commission adopted a Communication50 outlining an 
extensive action plan along four strategic priorities: 

– 

– 

– 

– 

raising the policy profile of climate change; 

providing support for adaptation to climate change; 

providing support for mitigation of climate change; 

promoting capacity development. 

A framework for a Common Renewable Export Strategy has recently been developed 
by  the  European  Renewable  Energy  Council.  It  identified  a  number  of  foreign 
markets of significant renewable energy potential in the near and longer term. It has 
also identified a number of measures needed to promote EU renewables exports. 

Regional co-operation  

The Baltic 21 Institute for Sustainable Industry was established to catalyse the work 
for  sustainable  development  in  the  industrial  sector  in  the  Baltic  Sea  region.  It  is  a 
network with representatives in the different countries in the region. The purpose is 
to extend co-operation on research and development and transfer of knowledge and 
technology. This initiative improves the network of  research institutes, universities, 
environmental  engineering  businesses,  manufacturing  businesses  and  government 
stakeholders.  Information  technology  plays  an  important  role  and  the  homepage 
(http://www.baltic21institute.org)  allows  visitors  to  search  for  business  partners, 
funding opportunities and other relevant information. 

50 

COM(2003) 85 final Climate Change in the Context of Development Co-operation,  

38 

 
 
  
 
                                                 
ANNEX IV: Areas to be examined with the EBRD 

This would include but not be limited to: 

(1) 

(2) 

Credit line(s) to, or risk-sharing facilities with, local commercial banks to 
finance  energy  efficiency  investments  in  the  SME  sector,  as  well  as 
measures which curb greenhouse gas emissions. The EBRD is developing 
this  scheme  in  Bulgaria  with  grant  support  from  the  Kozloduy  International 
Decommissioning  Support  Fund,  to  which  the  EU  is  the  major  donor. 
Typically,  the  grant  element  is  used  to  pay  for  project  screening  and 
appraisal, capacity building within participating banks and incentives for both 
banks and end-borrowers; 

Credit  lines  to  local  commercial  banks  to  finance  water  pollution 
reduction  investments  in  the  SME  sector.  With  GEF  support,  the  EBRD 
has set up the first such environmental credit facility in Slovenia to help clean 
up  the  Danube  River  Basin.  The  facility  aims  to  promote  environmental 
investments by private-sector companies and smaller municipalities. 

(3) 

A  framework  facility  to  support  renewable  energy  projects  in  acceding 
states. The framework would include a range of instruments aiming to: 

(a) 

(b) 

(c) 

(d) 

address  the  “equity  gap”  by  financing  project  developers  with  a 
subordinated loan of up to 20 % of the total investment; 

cover  incremental  cost.  A  grant  is  needed  to  pay  for  the  incremental 
costs compared to the existing electricity prices based on the present 
value of future electricity sales. The grant’s availability is conditional 
on  government  policy  introducing  effective  pricing  and  taking 
externalities  into  account.  The  grant  will  be  capped  and  incremental 
costs must be justified; 

secure investments against off-taker risk. In some cases existing credit 
insurances can be used by project operators to secure their investment 
against off-taker risks. The Facility can provide a guarantee to partly 
compensate the project developer for the lost income if the electricity 
off-taker does not pay; 

create  Renewable  Financing  Company.  The  proposed  financing 
company  takes  equity  participations  and  co-invests  in  renewable 
energy  projects  for  eight  to  ten  years  together  with  the  project 
developer.  A  financing  company  is  better  able  to  improve  the 
managerial capabilities and operations than, for example, a credit line 
with local banks.  

(4) 

A  framework  facility  to  support  ESCO  projects  in  acceding  states. 
ESCOs are a proven and very efficient private sector method to reduce energy 
consumption  in  both  the  public  and  private  sectors.  Well-structured  ESCO 
projects  offer  a  “win-win”  solution  to  the  client  (reduced  energy  costs)  and 
the  ESCO  sponsor  (profit  is  earned  as  a  result  of  achieving  or  exceeding 
energy reduction targets). However, ESCO development in acceding states is 

39 

 
 
  
 
constrained  by  a  number  of  obstacles.  The  EBRD,  with  EU  support  would 
provide technical assistance and contingent grants and/or payment guarantees. 

The first two activities could be combined to form a regional EU/EBRD framework facility 
along  the  lines  of  the  successful  EU/EBRD  SME  Facility,  focusing  on  the  financing  of 
environmental technology projects. 

40 

 
 
  
 
FINANCIAL STATEMENT 

Policy areas: 07 Environment and 08 Research 

Activity: Management and Support Expenditure 

TITLE OF ACTION: COMMUNICATION “ENVIRONMENTAL TECHNOLOGIES ACTION PLAN” 

1. 

BUDGET LINE(S) + HEADING(S) 

ENV 

07 01 04 01 

Legislation,  awareness-raising  and  other  general 
actions based on the Community action programmes in 
the  field  of 
the  environment  -  Expenditure  on 
administrative management 

RTD 

08 03 

Nanotechnologies, intelligent materials, new 
production processes and devices 

08 06 0101 
08 06 0102 
08 06 0103 

08 08 01 01 

08 08 01 02 
08 08 01 03 

Sustainable energy systems 
Sustainable surface transport 
Global change and eco-systems 

Supporting policies and anticipating scientific and 
technological needs 
Horizontal research activities involving SMEs 
Specific measures in support of international 
cooperation 

08 13 01 

Research programme for steel 

2. 

OVERALL FIGURES 

2.1. 

Total  allocation  for  action  (Part  B):  €23.676  million  until  2008,  of  which  DG 
ENV constitutes €1.58 million and DG RTD €22.096 million. 

2.2. 

Period of application: indefinite 

2.3. 

Overall multi-annual estimate of expenditure: 

(a) 

Schedule  of  commitment  appropriations/payment  appropriations 
intervention) (see point 6.1.1) 

(financial 

€ million (to three decimal places) 

Year 
2004 

2005 

2006 

2007 

2008 

2009 
and 
subs. 
Years 

Total 

Commitments 

Payments 

41 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(b) 

Technical and administrative assistance and support expenditure(see point 6.1.2) 

Commitments 

Payments 

5.700 

3.800 

4.014

5.144

3.674

5.144

0.000 

23.676

4.576

4.767

4.164

4.654

1.715 

23.676

Subtotal a+b 

Commitments 

Payments 

5.700 

3.800 

4.014

5.144

3.674

5.144

0.000 

23.676

4.576

4.767

4.164

4.654

1.715 

23.676

(c) 

Overall  financial  impact  of  human  resources  and  other  administrative  expenditure 
(see points 7.2 and 7.3) 

Commitments/ 
payments 

1.157 

1.157

1.157

1.157

1.157  

5.783

TOTAL a+b+c 

Commitments 

Payments 

6.857 

4.957 

5.171

6.301

4.831

6.301  

29.459

5.733

5.924

5.321

5.811

1.715 

29.459

*  Payment  appropriations  for  the  period  after  2008  will  depend  on  the  level  of  the 
commitment allocations 

The  estimated  requirements  for  this  plan  will  be  covered  within  the  allocations  of 
appropriations for the budget lines mentioned under section 1 above and granted to 
the  managing  DGs  (DGs  Environment  and  Research)  in  the  context  of  the  annual 
budget procedure. 

2.4. 

Compatibility with financial programming and financial perspective 

[X]  Proposal is compatible with existing financial programming. 

Proposal  will  entail  reprogramming  of  the  relevant  heading  in  the  financial 
perspective. 

Proposal  may  require  application  of  the  provisions  of  the  Inter-institutional 
Agreement. 

2.5. 

Financial impact on revenue: 

[X]  Proposal  has  no  financial  implications  (involves  technical  aspects  regarding 

implementation of a measure) 

OR 

Proposal has financial impact – the effect on revenue is as follows: 

42 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(NB All details and observations relating to the method of calculating the effect on 
revenue should be shown in a separate annex.) 

Budget line 

Revenue 

(€ million to one decimal place) 

Prior to
action 
[Year 
n-1] 

[Yea
r n] 

Situation following action 

[n+1] [n+2] [n+3

[n+4]  [n+5] 

] 

a) Revenue in absolute terms 

b) Change in revenue 

 ∆ 

(Please specify each budget line involved, adding the appropriate number of rows 
to the table if there is an effect on more than one budget line.) 

3. 

BUDGET CHARACTERISTICS 

Type of expenditure 

New 

EFTA 
contribution 

Contributions 
from applicant 
countries 

Heading in 
financial 
perspective 

Non-comp 

Diff 

NO 

NO 

NO 

No [3] 

4. 

LEGAL BASIS  

Treaty  establishing  the  European  Community  (in  particular  Article  174).  Decision 
1600/2002/EC  of  the  European  Parliament  and  of  the  Council  laying  down  the  Sixth 
Community Environment Action Programme, OJ L 242, 10.9.2002, p. 1-15, and Decision No 
1513/2002/EC  of  the  European  Parliament  and  the  Council  concerning  the  sixth  framework 
programme  of  the  EC  for  research,  technological  development  and  demonstration  activities, 
contributing to the creation of the European research area and to innovation (2002-2006) (OJ 
L 232, 29.08.2002, p. 1). 

5. 

DESCRIPTION AND GROUNDS 

5.1. 

Need for Community intervention  

5.1.1.  Objectives pursued 

To increase the development and uptake of environmental technologies. 

5.1.2.  Measures taken in connection with ex ante evaluation 

In  order  to  pave  the  way  for  a  Community  approach  to  environmental  technologies, 
Communications were adopted by the Commission in March 2002 and March 2003, the latter 
launching a stakeholder consultation. From this it became clear that the development of such 
an approach at European level was broadly welcomed. Actions have been proposed for their 
capacity to deliver balanced environmental, economic and social benefits. 

43 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5.1.3.  Measures taken following ex-post evaluation 

This will be covered by the regular reports mentioned under 8.2. 

5.2. 

Action envisaged and budget intervention arrangements 

Following  adoption  the  Communication  will  be  transmitted  to  the  Council  and  to  the 
European Parliament for discussions. Legislation or policy initiatives on particular aspects of 
ETAP may well be required in the future. 

All  parties  who  come  into  contact  with  environmental  technologies  are  concerned  by  the 
policy. 

There  may  be  a  need  to  revise  these  spending  estimates  in  the  light  of  the  results  of  the 
ongoing  discussions  between  the  Commission  and  the  European  Investment  Fund  on 
measures for leveraging investment in environmental technologies. At present no Commission 
contribution to such funds has been included: in any case, this contribution will be covered by 
the existing allocations of the two managing DGs. 

5.3.  Methods of implementation 

Promotion  of  the  plan  itself  will  be  largely  an  information-led  exercise.  The  further 
development  of  the  particular  actions  will  necessitate  a  combination  of  legislation, 
encouragement (name and fame), co-operation and information. These financial estimates are 
based on the assumption that only one set of long-term targets (point 4.2.1 in Communication) 
will be investigated at any one time. Should several be worked on in parallel then the resource 
implications will have to be reassessed. Any additional resources for this will be covered by 
the existing allocations. 

In general most of this Action Plan will be implemented through studies and projects as many 
of  the  actions  are  in  their  initial  stages.  In  addition,  as  some  of  the  work  will  make  use  of 
existing structures, including working through existing mechanisms, the number of meetings 
is often small. 

6. 

FINANCIAL IMPACT 

6.1. 

Total financial impact on Part B - (over the entire programming period) 

(The method of calculating the total amounts set out in the table below must be explained by 
the breakdown in Table 6.2) 

6.1.1.  Financial intervention 

Breakdown 

2004 

2005 

2006 

2007 

2008 

Total 

Commitments (in € million to three decimal places) 

Action 1 

Action 2 

0 

0 

44 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
etc. 

TOTAL 

0 

0 

0 

0 

0 

6.1.2.  Technical and administrative assistance, support expenditure and IT 

expenditure (commitment appropriations) 

0 

0 

2004 

2005 

2006 

2007 

2008 

Total 

1) Technical and 
administrative 
assistance 

a) Technical assistance 
offices 

b) Other technical and 
administrative assistanc
e: 

- intra muros: 

- extra muros: 

of which for 
construction and 
maintenance of 
computerised 
management systems 

Subtotal 1 

2) Support expenditure 

a) Studies 

b) Meetings of experts 

c) Information and 
publications 

Subtotal 2 

TOTAL 

5.35 

0.35 

3.784

4.884

3.384

4.884 

22.286

0.23

0.26

0.29

0.26 

1.39

5.7 

4.014

5.144

3.674

5.144 

23.676

6.2. 

Calculation  of  costs  by  measure  envisaged  in  Part  B  (over  the  entire 
programming period) 

Commitments (in € million to three decimal places) 

45 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Breakdown  

Type  
of outputs 
(projects, files ) 

Number of 
outputs 

Average unit 
cost 

(total for 
years 1to 
5)  

Total cost 

(total for years  

1to 5)  

1 

2 

3 

4=(2X3) 

Improving research 

- expert consultations 

Meeting reports 

32 

0.004 Mio € 

0.128 Mio € 

- studies 

Final 

reports

8 

2.073 Mio€ 

16.586 Mio €52 

Right market conditions 

- expert consultations 

Meeting reports 

30 

0.004 Mio € 

0.120 Mio € 

- studies 

Acting globally 

- expert consultations 

- studies51 

Moving forward 

Final 

reports

9 

0.122 Mio € 

1.100 Mio € 

Meeting reports 

Final reports 

0 

3 

0.004 Mio € 

0 Mio € 

1.5 Mio € 

4.5 Mio € 

- expert consultations 

Meeting reports 

23 

0.004 Mio € 

0.092 Mio € 

- studies 

Final reports 

1 

0.1 Mio € 

0.100 Mio € 

TOTAL COST 

22.626 Mio € 

The  allocation  of  studies  to  the  five  actions  is  indicative.  The  average  cost  conceals  large 
variations. Those actions covered by the 6FP are considerably more expensive. 

51 

52 

This  is  covered  by  DG  RTD  research  co-operation  which  is  expected  to  improve  the  situation  for 
environmental technologies in third countries. 
The  main  part  of  this  budget  (€13.5  million)  will  be  used  to  launch  the  pilot  phase  of  four  testing 
networks  and  three  technology  platforms  through  financing  coordination  actions  or  specific  support 
actions.  The  remainder  is  for  setting  up  common  EU  databases  and  directories  on  environmental 
technologies  (€1.25  million),  the  financing  of  national  and  regional  programmes  coordination  actions 
(i.e. ERA-NET) (€0.835 million), and studies on how best to stimulate stakeholders to be more active in 
the  demonstration  component  of  the  Framework  Programme  and  to  examine  possibilities  for  using 
article 169 (€1.001 million). 

46 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
7. 

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE 

The  needs  for  human  and  administrative  resources  will  be  covered  within  the  allocation 
granted to the managing DGs (Environment and Research) in the context of the annual budget 
procedure. 

7.1. 

Impact on human resources 

Types of post 

Staff to be assigned to management 
of the action using existing and/or 
additional resources 

Number of 
permanent posts 

Number of 
temporary posts 

Total 

or 

Officials 
temporary 
staff 

5.3 

1 

1 

A 

B 

C 

Other 
resources 

human 

Total 

7.3 

Description of tasks deriving from 
the action 

Desk officers and management 

Study 
informatics 

contracts, 

payments, 

Secretarial support 

Posts  covered  by  the  research  budget  are  classified  as  permanent  posts.  Calculated  on  the 
basis of 1 A grade for 0.2 B and 0.2 C grades. Values taken as the average over 2004-2008. 
This breaks down as 5.3 posts for DG RTD per year and 2 for DG ENV. 

7.2. 

Overall financial impact of human resources 

Type of human resources 

Amount (€) 

Method of calculation *  

Officials 

Temporary staff 

0.791 Mio € 

7.3 x 108,000 € 

Other human resources 

0 

(specify budget line)

Total 0.791 Mio € 

The amounts are total expenditure for twelve months. This breaks down as €0.57 million for 
DG RTD and €0.21 million for DG ENV. 

7.3 

Other administrative expenditure deriving from the action 

Budget line 

Amount Mio € 

Method of calculation 

47 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(number and heading) 

Overall allocation (Title A7) 

A0701 – Missions 

A07030 – Meetings 

€0.026 

€0.340 

20 x €1300 (based on two-day 
missions including €300 
indemnity + €850 travelling + 
€150 accommodation) 
Average over five years with 
€20,000 per meeting 

A07031 – Compulsory committees 1 

covered under 6.2 

A07032 – Non-compulsory committees 1 

A07040 – Conferences 

A0705 – Studies and consultations 

Other expenditure (specify) 

Information systems (A-5001/A-4300) 

Other expenditure - Part A (specify) 

Total €0.366 

See above 

The amounts are total expenditure for twelve months. 

1 Specify the type of committee and the group to which it belongs. 

I. 

II. 

Annual total (7.2 + 7.3) 

Duration of action 

III. 

Total cost of action (I x II) 

€1.157 Mio 

5 years 

€5.783 Mio 

8. 

FOLLOW-UP AND EVALUATION 

8.1. 

Follow-up arrangements 

The Commission proposes to review the effectiveness of the ETAP every two years following 
its publication. For this purpose the Commission will prepare a report which will be published 
and submitted to the institutions. 

8.2. 

Arrangements and schedule for the planned evaluation 

The precise procedures for the implementation will have to be arranged. 

48 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9. 

ANTI-FRAUD MEASURES 

The  proposed  activities  only  consist  of  expenditure  on  personnel,  expert  meetings,  study 
contracts  and  missions.  Contracts  will  be  subject  to  the  Commission’s  usual  control 
mechanisms and therefore there is no need for supplementary anti-fraud measures. 

49