Commission staff working document - Accompanying document to the Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on Investing in the Development of Low Carbon Technologies (SET-Plan) - R&D investment in the priority technologies of the european strategic energy technology plan {COM(2009) 519 final} {SEC(2009) 1295} {SEC(2009) 1297} {SEC(2009) 1298}
Date: 2009-10-07
Institutions: European Commission
Subjects: EU industrial policy, action programme, climate change, energy policy, energy research, environmental policy, reduction of gas emissions, renewable energy, research and development

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 7.10.2009 
SEC(2009) 1296 

COMMISSION STAFF WORKING DOCUMENT 

Accompanying document to the  

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

on Investing in the Development of Low Carbon Technologies  
(SET-Plan) 

R&D INVESTMENT IN THE PRIORITY TECHNOLOGIES OF THE 
EUROPEAN STRATEGIC ENERGY TECHNOLOGY PLAN 

{COM(2009) 519 final} 
{SEC(2009) 1295} 
{SEC(2009) 1297} 
{SEC(2009) 1298} 

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COMMISSION STAFF WORKING DOCUMENT 

R&D INVESTMENT IN THE PRIORITY TECHNOLOGIES OF THE EUROPEAN 
STRATEGIC ENERGY TECHNOLOGY PLAN 

Table of contents 

1. 

2. 

3. 

3.1. 

3.2. 

3.3. 

3.4. 

4. 

4.1. 

4.2. 

4.3. 

5. 

6. 

7. 

EXECUTIVE SUMMARY......................................................................................... iii 

INTRODUCTION ....................................................................................................... 8 

METHODOLOGY....................................................................................................... 9 

Scope of the report ....................................................................................................... 9 

Industrial R&D investments....................................................................................... 12 

Member States' public R&D investments .................................................................. 26 

EU FP6 public energy R&D investments .................................................................. 29 

RESULTS .................................................................................................................. 30 

Overall results ............................................................................................................ 30 

R&D investments by SET-P priority technology ...................................................... 42 

Analysis of uncertainties ............................................................................................ 59 

CONCLUSIONS........................................................................................................ 66 

REFERENCES........................................................................................................... 73 

List of acronyms......................................................................................................... 77 

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1. 

EXECUTIVE SUMMARY 

The  present  report  aims  at  estimating  the  current  research  and  development  (R&D) 
investments in selected low-carbon energy technologies in the EU-27 funded by the Member 
States, through the 6th EU Research and Euratom Framework Programmes and by companies 
with headquarters registered in the EU. Its ultimate objective is to offer a benchmark of the 
current R&D spending on those technologies to serve as a basis for the comparison with their 
future  research  investment  needs.  The  present  assessment  forms  a  starting  point  for  further 
work  on  this  issue  given  the  current  lack  of  a  comprehensive  overview  on  corporate  and 
public  R&D  investments  in  selected  low-carbon  technologies.  It  has  been  prepared  by  the 
Institute  for  Prospective  Technological  Studies  (IPTS)  of  the  European  Commission's  Joint 
Research  Centre  (JRC)  as  a  central  reference  input  to  the  forthcoming  Communication  on 
Investing  in  the  Development  of  Low  Carbon  Technologies.  The  Communication  is  part  of 
the implementation of the Strategic Energy Technology Plan (SET-Plan) for Europe and will 
address the financing needs of selected low-carbon technologies in Europe. 

This  report  forms  part  of  the  regular  mapping  of  energy  research  capacities  that  is  being 
undertaken within SETIS (SET-Plan Information System). It benefited substantially from the 
review organised within the European Commission's Joint Research Centre in the context of 
SETIS and from comments provided by experts from the European Commission's Directorate 
Generals for Energy and Transport (TREN) and for Research (RTD), who initiated this work. 
Furthermore,  numerous  external  experts  provided  valuable  inputs  at  various  stages  of  this 
report.  A  consultation  process  with  Member  States  in  the  frame  of  the  SET-Plan  Steering 
Group Sherpa meetings largely contributed to the analysis of public R&D investments, while 
information  supplied  by  companies  and  industry  associations  was  important  for  assessing 
corporate R&D efforts.  

The  technologies  considered  in  the  present  analysis  include  those  for  which  the  SET-Plan 
proposed to launch European Industrial Initiatives and those for which a dedicated European 
programme  already  existed:  wind  energy,  photovoltaics (PV) and  concentrating solar power 
(CSP),  carbon  dioxide  capture  and  storage  (CCS),  biofuels,  hydrogen  and  fuel  cells,  smart 
grids,  nuclear  fission  (with  a  focus  on  generation  IV  reactors),  and  nuclear  fusion.  For 
simplification, this group of technologies will be called 'SET-Plan priority technologies' in the 
following, often grouped into nuclear and non-nuclear technologies. 

For corporate and Member States' national public R&D spending the focus of the analysis lies 
on the 2007 figures while the relevant EU R&D investments are annualised figures under FP6 
(2002-2006). In order to avoid putting too much weight to one-off events or data mavericks, 
annual  averages  of  the  public  national  R&D  spending  between  2002  and  2007  are  also 
included for comparison.  

As  data  on  corporate  R&D  investment  are  sketchy,  especially  at  the  level  of  technological 
detail  required,  a  novel  approach  for  estimating  them  has  been  developed  for  the  present 
assessment.  For  each  SET-Plan  priority  technology,  the  number  of  key  R&D  investors  has 
been identified. A company's overall R&D investment has then been allocated to individual 
technologies  based  on  the  combination  of  publicly  available  information  with  expert 
judgment. Hence, the results only provide a rough estimation of research efforts and should 
not be used without taking into account the methodological limitations of this approach.  

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With regard to public national R&D funding, the most recent publicly available data (2007) 
were used from  the Eurostat database on Government Budget Appropriations or Outlays  on 
R&D  (GBAORD)  and  in  particular  the  International  Energy  Agency's  (IEA)  statistics  on 
Research, Development and Demonstration (RD&D), complemented by national information 
that was directly provided by a number of Member States. Unfortunately, both the GBAORD 
and the IEA databases miss some entries at the technological level of detail needed, and only 
19  of  the  EU  Member  States  are  covered  in  the  IEA  RD&D  statistics  as  the  remaining 
Member States are not IEA members. Data missing for 2007 were gap filled with data from 
previous years if available or data taken from official national sources.  

Relevant  EU  R&D  funding  under  the  6th  Research  Framework  Programme  and  the 
EURATOM  Framework  Programme  has  been  taken  into  account.  Funds  under  these 
programs  have  been  assessed  on  the  basis  of  individual  projects,  going  beyond  projects 
financed under the 'core' energy budget line 'sustainable energy systems', and also including 
relevant  projects  funded  under  budget  lines  such  as  'sustainable  surface  transport'  or 
'horizontal research activities involving small and medium sized enterprises (SMEs)' etc. An 
annual average of the commitments has been used for these multiannual programmes (2002-
2006).  

Both the basic data as well as the approach applied in the present study are associated with 
uncertainties,  which  have  been  identified  and  quantified  to  the  extent  possible1.  The  largest 
source of error derives from the assumption-based allocation process used for breaking down 
a  company's  R&D  investment  into  individual  technologies.  With  regard  to  public  R&D 
investments, the differences in the extent to which individual Member States include regional 
funding,  institutional  budgets  and  support  to  demonstration  activities  in  their  submission  to 
the  International  Energy  Agency  adds  some  uncertainty.  Overall,  it  is  estimated  that  the 
cumulative error margin of total R&D investments in SET-Plan priority technologies does not 
exceed  ±  24%  even  though  higher  uncertainties  may  apply  to  the  results  related  to  one 
individual technology. The order of magnitude of the results obtained in the present report is 
also  supported  by  a  comparison  with  other  sources  both  at  the  aggregated  level  and  at  the 
level  of  individual  technologies  and  funders.  It  can  thus  be  considered  as  a  reasonable 
approximation of the present R&D investments. Hence, despite the limitations of the present 
analysis, some policy-relevant conclusions can be drawn from the present assessment: 

Investments dedicated to R&D in non-nuclear SET-Plan priority technologies amounted 
to  €2.38  billion  in  2007 2  with  a  division  that  is  roughly  balanced  across  individual 
technologies 

Investments  in  non-nuclear  energy  R&D  in  SET-Plan  priority  technologies  are  estimated  at 
€2.38 billion. The R&D investments dedicated to  CCS, smart grids, biofuels, wind energy and 
photovoltaics  are  in-between  €270  million  and 
€380  million  each.  The  substantially  larger 
investments  for  hydrogen  and  fuel  cells  research  (€616  million)  may  be  explained  by  the 
diversity  of  technologies  that  are  subsumed  under  this  heading,  thus  attracting  R&D 
investments  from  many  large  and  small  companies  from  a  broad  variety  of  sectors  (e.g.  car 

1 

2 

The  estimates  of  industrial  R&D  investments  of  the  present  report  most  likely  constitute  a  lower 
estimate  of  industrial  research  efforts  due  to  the  lack  of  data  and  the  limitation  in  the  number  of 
companies  included  in  the  assessment.  The  extent  of  the  related  uncertainties  could,  however,  not  be 
quantified. 
2007 figures  are provided  for  corporate  and  Member  States'  national public  R&D spending  while  the 
relevant EU R&D investments are annualised figures under FP6 (2002-2006). 

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manufacturers, electric utilities, chemical companies and component suppliers). At the same 
time,  few  countries  and  companies  are  active  in  research  on  concentrating  solar  power 
technologies  (CSP),  explaining  the  comparatively  low  R&D  investments  in  this  field  (€86 
million). 

Industry finances large parts of the R&D of non-nuclear SET-Plan priority technologies  

Corporate  R&D  investments  in  non-nuclear  SET-Plan  priority  technologies  reached  €1.66 
billion in 2007, thus accounting for 69% of the total investments.3 This highlights the active 
role  of  EU-based  companies  in  those  technologies  and  the  acknowledgment  of  the  need  for 
further research in order to strengthen the position of the EU in these promising technologies. 
However,  the  R&D  intensities  found  for  some  of  the  sectors  relevant  for  the  SET-Plan  (in-
between  2.2%  and  4.5%)  remain  well  below  the  intensities  in  other  industrial  sectors  that 
experienced a boom in recent years; for example, the IT-related sectors 'software', 'computer 
hardware' or 'semi-conductors' experienced R&D intensities in the order of 8% to 18% over 
the past five years4, 5.  

The share of corporate R&D investments is elevated for the more mature technologies wind 
energy and biofuels6. In comparison, the share of corporate R&D investments is lower for PV, 
hydrogen  and  fuel  cells  and  CSP,  as  well  as  for  generation  IV  nuclear  reactors  and  nuclear 
fusion. These may be considered as less mature, in particular if we assume that research in PV 
concentrates on new technologies instead on the more mature crystalline silicon cells. Note, 
however,  that  the  results  describing  the  distribution  of  R&D  spending  by  investor  must  be 
interpreted with care due to the differences in the nature between corporate and public R&D 
spending.  

The  assessment  indicates  that  innovation  in  the  energy  sector  may  not  predominantly  being 
carried out by classical energy companies such as electric utilities or oil/gas suppliers, which 
invest  only  a  very  small  percentage  of  their  revenues  in  R&D.  Industries  with  elevated 
research  activities  in  low-carbon  energy  technologies  include  companies  active  in  industrial 
machinery,  chemicals,  energy  components  or  those  that  are  exclusively  active  in  one  area 
(such as a specialised wind energy company).  

Public  R&D  spending  on  non-nuclear  SET-Plan  priority  technologies  is  increasing  despite  a 
decline in the overall energy research budgets, but synergies across Member States have not yet 
been fully exploited 

Despite an overall decrease in energy research budgets over the past two decades (largely due 
to  shrinking  nuclear  R&D  budgets)  with  a  slight  upward  trend  in  more  recent  years, 
investments  in  non-nuclear  SET-Plan  priority  technologies  have  been  more  or  less  stable 
throughout the 1990s with an important increase since the beginning of the new century. In 

3 

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6 

The  share  of  corporate  R&D  investments  drops  to  56%  of  the  total  if  nuclear  SET-Plan  priority 
technologies are also included, see Figure 1. 
Note, however, that R&D intensities cannot directly be compared between different sectors due to the 
considerable  differences  in  their  innovation  systems  (see  e.g.  Malerba,  2004;  Kaloudis  and  Pedersen, 
2008, on the energy sector).  
Figures relate to EU-based companies and are taken from various versions of the EU Industrial R&D 
Investment Scoreboards (Hernandez Guevara et al., 2008). 
It  is  also  elevated  for  CCS.  This  may,  however,  be  due  to  an  under-estimation  of  the  public  R&D 
efforts. 

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2007,  Member  States  invested  €571  million  in  R&D  related  to  the  non-nuclear  SET-Plan 
priority  technologies,  which  is  equivalent  to  34.5%  of  their  total  public  non-nuclear  energy 
R&D  budgets,  and  indicates  the  importance  given  to  these  technologies.  On  top  of  the 
national  funding,  EU  investments  under  FP6  added  another  €157  million  for  the  public 
research on those technologies.  

One may be led to compare these R&D investments of €728 million with a similar selection 
of public funds in other world regions. This would put the EU ahead of the US American and 
Japanese  'non-nuclear  SET-Plan  R&D  spending',  in  spite  of  both  regions  having  slightly 
higher overall energy R&D budgets.  

Such  comparison,  however,  may  be  misleading  as  it  hides  important  differences  in  the  way 
energy R&D is being financed and carried out across the different regions. Unlike the strong 
focus and coordination provided for energy (research) in the US by the Department of Energy 
(DoE)  and  in  Japan  through  the  Ministry  for  Economy,  Trade  and  Industry  (METI),  no 
unified European programme currently exists for fostering low-carbon technologies with the 
exception  of  fusion  related  research.  Instead,  pan-European  cooperation  is  limited  and 
synergies between Member States in the development of new energy technologies have so far 
not  been  fully  exploited,  although  recent  initiatives  such  as  the  SET-Plan  or  the  ERA-NET 
scheme  have  started  to  address  this  problem.  Furthermore,  R&D  activities  within  Member 
States are often also fragmented, often due to the complexity created by the involvement of 
several ministries and agencies in the management of different parts of national programmes. 
This  fragmentation  would  tend  to  distort  any  benchmarking  of  the  US  and  Japanese  funds 
with the aggregated R&D investment of EU Member States and the EU. 

On top of the €2.38 billion invested in non-nuclear  SET-Plan priority technologies, €0.94 billion 
are  dedicated  to  nuclear  SET-Plan  priority  technologies,  with  fusion  research  receiving  high 
public support due to the capital investment needs of the ITER construction 

Investments  dedicated  to  R&D  in  nuclear  SET-Plan  priority  technologies  (excluding 
treatment of nuclear waste, radioprotection etc.) are estimated at €939 million, with an almost 
equal  split  between  reactor-related  fission  research  and  fusion  research.  Nuclear-fission 
related research in the context of the SET-Plan focuses on R&D investments for Generation 
IV reactors. As data on nuclear R&D budgets are not available in the necessary detail, they 
were approximated by all nuclear reactor related R&D investments, which implies the risk of 
overestimating  the  Generation  IV  reactor  R&D  investments.  Total  nuclear  reactor  R&D 
investments  sum  to  €458  million,  almost  half  of   which  is  financed  by  the  private  sector 
(45%). France accounts for more than half (52%) of the aggregated EU Member States' public 
nuclear  reactor  R&D  spending  and  French  companies  hold  an  even  higher  share  in  the 
industrial nuclear reactor related R&D investments. The total investment dedicated to fusion 
research is around €480 million but th ere is hardly any private sector R&D investment due to 
the  long  time  horizon  of  this  research  area  and  the  high  capital  investment  needed  for  the 
construction  phase  of  the  International  Thermonuclear  Experimental  Reactor  (ITER).  The 
Member States account for 58% of all R&D investment in fusion, while the EU share is 42%. 

Corporate and public R&D investments in SET-Plan priority technologies largely concentrate in 
only few Member States 

Both  public  and  private  R&D  investments  in  (nuclear  and  non-nuclear)  SET-Plan  priority 
technologies  are  largely  concentrated  (see  Figure 1).  For  many  technologies,  the  countries 

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with  high  public  R&D  funds  simultaneously  account  for  the  largest  corporate  R&D 
investments.  

The estimates of the present report indicate that 99% of the aggregated national R&D budgets 
on  SET-Plan  priority  technologies  originate  from  eleven  Member  States  namely  France, 
Germany,  Italy,  the  UK,  Denmark,  Spain,  the  Netherlands,  Belgium,  Sweden,  Finland  and 
Austria with the first three accounting for two thirds. At the same time, R&D investments in 
SET-Plan  priority  technologies  from  companies  located  in  Germany,  France,  the  UK, 
Denmark,  Spain  and  Sweden  were  found  to  account  for  almost  95%  of  the  total  corporate 
R&D  investments.  In  many  cases,  the  group  of  countries  that  give  strong  public  support  to 
research into a certain technology simultaneously accounts for the largest R&D investment of 
industry  into  that  technology.  This  may  be  seen  as  an  indication  of  a  positive  correlation 
between public research support and industrial R&D investment.  

Total estimated R&D investments in SET-P priority energy 
Total estimated R&D investments in SET-P priority energy 
technologies
technologies

56%
56%

~ €3.32 
~ €3.32 
billion 
billion 
(of which 72% 
(of which 72% 
is non nuclear)
is non nuclear)

11%
11%

33%
33%

Corporate R&D investment
Corporate R&D investment
(2007) 
(2007) 

Public EU (FP6 respectively
Public EU (FP6 respectively
EURATOM; annual average)
EURATOM; annual average)

Public R&D spending of EU
Public R&D spending of EU
Member States (2007)
Member States (2007)

Distribution of corporate R&D investments in SET-P priority 
Distribution of corporate R&D investments in SET-P priority 
technologies across EU Member States in 2007 
technologies across EU Member States in 2007 
(location of company headquarters)
(location of company headquarters)

Italy
Italy

Austria
Austria

Others
Others

Belgium
Belgium

Finland
Finland

Sweden
Sweden

Spain
Spain

Germany
Germany

Distribution of public R&D investments in SET-P priority 
Distribution of public R&D investments in SET-P priority 
technologies across EU Member States in 2007
technologies across EU Member States in 2007

Finland
Finland

Sweden
Sweden

Austria
Austria

Others
Others

Belgium
Belgium

Netherlands
Netherlands

France
France

Denmark
Denmark

UK
UK

~ €1.86 
~ €1.86 
billion
billion

France
France

Spain
Spain

Denmark
Denmark

UK
UK

~ €1.10 
~ €1.10 
billion
billion

Italy
Italy

Germany
Germany

Figure 1: 

Approximate  R&D  investment  in  SET-Plan  priority  technologies  (nuclear  and  non-
nuclear) by Member State 

Source:  JRC-IPTS, rounded numbers 

Note:  Figures are subject to uncertainties in particular for industrial R&D investments. Uncertainties become 
more elevated when displaying corporate R&D investments at Member State level given that the availability of 
data  differed  between  countries.  Furthermore,  the  regional  allocation  of  R&D  investment  by  site  of  the 
registered companies' headquarters needs to be considered when interpreting the above figure. 

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2. 

INTRODUCTION 

The  present  report  aims  to  provide  a  rough  estimate  of  the  current  corporate  and  public 
research and development (R&D) investments in low-carbon energy technologies in the EU-
27. Its ultimate objective is to offer a benchmark of their current R&D spending to serve as a 
basis for the comparison with the future R&D investments that will be needed for addressing 
the  key  technology  challenges  identified  by  the  Strategic  Energy  Technology  Plan  (SET-
Plan).  

The  report  has  been  prepared  by  the  Institute  for  Prospective  Technological  Studies  of  the 
European Commission JRC as part of the regular mapping of energy research capacities that 
is  being  undertaken  within  SETIS.  It  has  been  used  as  an  input  to  the  forthcoming 
Communication  on  Investing  in  the  Development  of  Low  Carbon  Technologies  .  This 
communication  is  foreseen  as  part  of  the  implementation  of  the  SET-Plan  (European 
Commission,  2007a;  European  Council,  2008).  It  will  address  options  for  meeting  the 
financing needs of low-carbon technologies. As a starting point, it will thus need to identify 
the  potential  gap  between  present  R&D  investments  and  the  investments  required  for 
achieving the SET-Plan targets.  

This  report  assesses  the  current  R&D  spending  in  the  EU-27  allocated  towards  low-carbon 
energy  technologies.  The  technologies  considered  include  those  for  which  the  SET-Plan 
proposes  to  launch  European  Industrial  Initiatives,  i.e.  wind;  solar  photovoltaic  (PV)  and 
concentrating solar power (CSP); carbon dioxide capture and storage (CCS); smart grids; (2nd 
generation) transport biofuels; nuclear fission (with a focus on generation IV reactors). Two 
additional technologies, for which joint activities already existed and which are mentioned in 
the  SET-Plan,  are  also  assessed:  hydrogen  and  fuel  cells,  and  nuclear  fusion.  For 
simplification, this group of technologies will be called 'SET-Plan priority technologies' in the 
following,  sometimes  grouped  into  nuclear  and  non-nuclear  technologies  due  to  the  distinct 
research structure between the two. 

For the technologies listed above, data on R&D spending by industry, the public sector and 
from EU funds have been gathered7. However, data on corporate R&D investment are scarce. 
The data situation becomes even worse when looking into R&D spending at the level of the 
aforementioned technological fields. Various data sources and approaches have therefore been 
tested and combined where feasible. The methodology developed for obtaining estimates of 
the corporate R&D is described in detail in chapter 2 of this report. It is complemented by a 
description  of  the  data  sources  used  with  regard  to  public  national  R&D  funding,  i.e.  the 
GBAORD from Eurostat and the RD&D statistics of the International Energy Agency. For an 
overview  of  the  EU  funding,  the  6th  Research  Framework  Programme  and  the  EURATOM 
Framework Programme have been assessed. 

The results of this approach are presented and discussed in chapter 3, both for aggregates and 
for  individual  SET-Plan  priority  technologies.  To  the  extent  possible,  a  breakdown  by 
Member  States  is  shown  for  public  funds.  Moreover,  investments  are  grouped  according  to 

7 

Note that in some cases the allocation of research investment to either industry or the public sector is 
not  straightforward.  For  example,  in  Denmark  the  electric  utilities  finance  (via  an  add-on  to  the 
electricity  bill)  a  research  programme  that  is  publicly  controlled  (SRS  project,  2007).  Also,  part  of 
companies'  R&D  expenditures  may  be  (co-)financed  with  public  money.  The  way  in  which  this  is 
tackled in the present report is described in the methodological part. 

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the source of funds and compared to other studies where available. The chapter ends with an 
analysis of the uncertainties.  Chapter four  draws  the  main  policy-relevant findings from  the 
present data assessment. However, given the lack of data and the problems with compatibility 
across different data sources, the results of this report must not be regarded as exhaustive and 
comprehensive.  

3. 

METHODOLOGY 

3.1. 

Scope of the report 

The objective of this report is to estimate the current public and industrial R&D investments 
directed  towards  SET-Plan  priority  technologies  in  the  EU.  These  comprise  wind  energy; 
concentrating  solar  power  (CSP)  and  solar  photovoltaic  (PV);  carbon  dioxide  capture  and 
storage (CCS); smart grids; transport biofuels; hydrogen and fuel cells; nuclear fission (with a 
focus on generation IV reactors); and nuclear fusion.  

The assessment is focused on a single indicator representing research and development inputs: 
the  R&D  investments.  R&D  outputs,  such  as  innovation  surveys  or  analyses  of  patents  that 
are considered valuable indicators for innovation activity (Griliches, 1990; Jaumotte and Pain, 
2005), are not included.  

Besides,  the  indicator  'R&D  investments'  may  be  too  narrow  for  capturing  the  scope  of 
industrial R&D activities, parts of which may be conducted within departments or groups that 
are not formally designated as 'R&D' departments (see Freeman and Soete, 2009 with further 
references8). Furthermore, a considerable part of innovation in the energy sector takes place 
on the side of the component supplier, i.e. new technologies are rather bought in by the energy 
companies than being developed in-house (Jacquier-Roux and Bourgeois, 2002; Kaloudis and 
Pedersen,  2008).  Even  though  the  approach  of  the  present  report  aims  at  going  beyond  the 
boundaries  of  the  classical  energy  sector,  it  can  capture  this  phenomenon  only  to  a  limited 
extent, thus leading to a systematic under-estimation of innovation efforts related to energy. 
Future work that considers major parts of the supply chains in various energy sectors might be 
able to overcome this.  

Above and beyond, innovation depends on a wide variety of factors throughout all phases of 
the innovation chain, i.e. the scientific research, development and market introduction of new 
technologies.  Hence,  a  more  comprehensive  approach  would  need  to  consider  the  broader 
context  of  'push'  and  'pull'  policies  and  measures  that  address  the  research,  development, 
demonstration  and  deployment  of  innovative  technologies9  (see  Figure 2),  as  well  as 
institutional  capacities,  the  role  of  stakeholders,  related  policies  and  measures  and  their  use 
and interplay (see e.g. Foxon, 2003; Grubb, 2004; Kaloudis and Pedersen, 2008, chapter 5.2).  

Notwithstanding the above-listed limitations of the focus on one single indicator, the present 
analysis of energy-related R&D investments can help in better understanding the status quo of 

8 

9 

Freeman  and  Soete  (2009)  also  apply  Goodhart's  law  (Goodhart,  1972)  to  Science,  Technology  and 
Innovation  Indicators:  once  these  indicators  are  made  policy  targets,  they  loose  much  of  their 
information content that qualified them to play such a role. 
Empirically,  Johnstone  et  al.  (2008)  show  on  the  basis  of  an  assessment  of  exhaustive  panel  data  on 
patent applications that both, dedicated R&D spending and (quantity and price-based) 'pull-policies' are 
significant determinants of patenting in renewable energy.  

EN 

9 

   EN 

 
                                                 
one central step in the innovation cycle, without claiming to provide an indication of the total 
European innovation capacities with regard to SET-Plan priority technologies.  

Scope of the
Scope of the
assessment
assessment

Figure 2: 

Steps of technological innovation and scope of the assessment  

Source:  Grubb, 2004 (original figure) 

Original figure: Grubb, 2004
Original figure: Grubb, 2004

But even the present assessment which focuses only on R&D investments requires an upfront 
definition of the research, development and demonstration activities that it covers:  

R&D covers three activities according to the Frascati Manual (OECD, 2002): basic research, 
applied research, and experimental development. Basic research is experimental or theoretical 
work  undertaken  primarily  to  acquire  new  knowledge  of  the  underlying  foundation  of 
phenomena and observable facts, without any particular application or use in view. Applied 
research  is  also  original  investigation  undertaken  in  order  to  acquire  new  knowledge.  It  is, 
however,  directed  primarily  towards  a  specific  practical  aim  or  objective.  Experimental 
development is systematic work, drawing on existing knowledge gained from research and/or 
practical  experience,  which  is  directed  to  producing  new  materials,  products  or  devices,  to 
installing  new  processes,  systems  and  services,  or  to  improving  substantially  those  already 
produced or installed. RD&D includes demonstration in addition.  

The degree to which the financing of different RD&D activities are included in the figures of 
the  present  report  differs  between  industrial  and  public  national  and  EU  funds  as  well  as 
across individual Member States10: 

•  Data on public national R&D investments of EU Member States are generally taken from 
the  IEA  RD&D  statistics  (see  section  1.1.1)  or  the  GBOARD  (socio-economic  objective 
5).  While  the  latter  focuses  on  R&D,  the  IEA  also  includes  demonstration  activities.  In 
practice,  however,  most  Member  States  do  either  not  provide  data  on  funds  directed 
towards demonstration or do not display them separately. Hence, data on aggregated public 
national funds of EU Member States dedicated to demonstration amount to some 9% of the 

10 

The  aim  of  this  section  is  to  clarify  the  scope  of  RD&D  covered  in  the  present  report.  For  a  more 
detailed description of the IEA database see section 1.1.1. 

EN 

10 

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total  energy  R&D  budget,  only.  Differences  in  the  share  of  funds  directed  towards 
demonstration  occur  between  technologies,  as  illustrated  in  Figure 3.  Given  the  high 
amounts needed for large-scale demonstration projects and considering the data gaps, the 
figure on public support to demonstration activities included in the IEA database seem to 
be an under-estimation at the aggregated EU level. In the following, we thus assume that 
the  IEA  database  largely  focuses  on  R&D  (a  hypothesis  that  is  supported  by  the  large 
similarity of the aggregated EU figures with data from the GBOARD, the latter of which 
focusing  on  R&D  only).  Note  also  that  basic  research  shall  be  excluded  in  the  IEA 
database  unless  it  is  clearly  oriented  towards  energy-related  technologies.  However,  in 
some  Member  States,  the  institutional  budgets  included  in  the  submission  data  may 
partially cover research of more basic nature. 

•  Regarding  the  EU  public  R&D  spending,  only  funds  within  the  6th  Research  Framework 
Programme have been assessed. While these indeed include some support to demonstration 
activities, their main focus lies on R&D.  

•  For estimating industrial R&D investments, companies' annual report (largely via the 'EU 
Industrial  R&D  Investment  Scoreboard')  have  been  used  as  a  starting  point.  They  thus 
follow  the  accounting  definitions  of  R&D,  such  as  within  the  International  Accounting 
Standard 38 ('Intangible Assets'), which uses the definition of R&D of the Frascati Manual 
(OECD, 2002). In general, technology demonstration mostly incurs engineering costs and 
is  thus  recommended  to  not  be  included  under  R&D  investment.  However,  this  can  be 
expected to strongly depend on the type of sector/activity, influenced e.g. by the maturity 
of the technology and/or the policy support to its deployment.  

Following these considerations, the term R&D will be used in the following despite the fact 
that  demonstration  activities  are  included  to  a  certain  extent  that  varies  across  different 
funders,  countries  and  companies.  Note  that  even  within  the  category  'R&D'  systematic 
differences  may  occur,  for  example  between  public  and  industrial  research  with  the  former 
often  focusing  on  research  of  a  more  basic  nature,  while  industry  tends  to  finance  more 
applied research.  

n
n
o
o

i
i
l
l
l
l
i
i

m
m

€ 
€ 

3000
3000

2500
2500

2000
2000

1500
1500

1000
1000

500
500

0
0

Public R&DD budget breakdown in 2007 
Public R&DD budget breakdown in 2007 
(Member States only)
(Member States only)

9%
9%

Demonstration (D)
Demonstration (D)

Research and Development (R&D)
Research and Development (R&D)

8%
8%

15%
15%

Total Energy R&D
Total Energy R&D
budget
budget

SET-Plan
SET-Plan
technologies
technologies

Non-nuclear SET-P
Non-nuclear SET-P
technologies
technologies

200
200

180
180

160
160

140
140

120
120

100
100

80
80

60
60

40
40

20
20

0
0

Share of demonstration activities in the non-nuclear 
Share of demonstration activities in the non-nuclear 
SET-P technologies
SET-P technologies

Demonstration (D)
Demonstration (D)
Research and Development (R&D)
Research and Development (R&D)

14%
14%

11%
11%

30%
30%

29%
29%

11%
11%

1%
1%

3%
3%

CCS
CCS

PV
PV

CSP
CSP

Wind
Wind
energy
energy

Transport
Transport
biofuels
biofuels

H2 and
H2 and
fuel cells
fuel cells

Smart
Smart
Grids
Grids

n
n
o
o

i
i
l
l
l
l
i
i

m
m
 € 
 € 

Figure 3: 

Share of demonstration activities in the IEA RD&D statistics, 2007 

EN 

11 

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Source:  Data from IEA, gap filled and complemented with national data for DE, UK, FR, AT, BE. Irish data on 
demonstration activities (year 2006) could be obtained only for the total energy R&D budgets, but not broken 
down by technology.  

3.2. 

Industrial R&D investments 

3.2.1.  Allocating companies' annual R&D investments by technology 

3.2.1.1.  General approach 

Data  on  corporate  R&D  expenditures  are  difficult  to  obtain  (see  e.g.  de  Nigris  et  al.,  2008; 
SRS Project, 2008; van Beeck et al., 2009; Wiesenthal et al., 2008). The data become  even 
sketchier  when  looking  at  the  R&D  expenditure  by  technology.  The  difficulties  can  be 
explained by the lack of a regulatory framework that obliges private companies to report their 
R&D investment, the fact that some companies consider this information as confidential, and 
that others use them for strategic purposes (Gioria, 2007). 

For  this  reason,  there  is  currently  no  single  database  that  can  provide  a  comprehensive 
overview  of  industrial  R&D  investments  dedicated  to  individual  technologies.  In  order  to 
nevertheless  gather  a  maximum  of  information,  various  data  sources  have  been  assessed  in 
parallel in this report, all of which have their own specific strengths and shortcomings. The 
most promising method turned out to be a novel and assumption-based approach. It combines 
data  on  R&D  investments  of  individual  companies,  primarily  taken  from  the  EU  Industrial 
R&D  Investment  Scoreboard  (Hernández  Guevara  et  al.,  2008),  with  additional  information 
about  the  company,  thus  allowing  a  rough  estimation  of  a  companies'  R&D  investment  by 
SET-Plan priority technology. 

This bottom-up approach has thus been chosen as a first option for deriving an estimation of 
the  corporate  R&D  investments  in  the  relevant  technological  fields.  In  brief,  this  approach 
includes the following steps:  

•  The identification of key industrial players for a certain sector. 

•  The gathering of information on R&D investments of these companies preferably through 
the EU Industrial R&D Investment Scoreboard, but also web-published annual reports or 
direct contacts. 

•  For  companies  active  in  several  technological  fields  (such  as  electrical  utilities,  oil 
companies,  component  suppliers),  an  allocation  of  the  R&D  investments  to  individual 
technologies to the extent possible. For companies that are specialised in one technological 
field only, their entire R&D expenditure was allocated to that technology. 

•  The summing up of the individual companies' R&D investments by technology. 

This approach has been complemented by data extracted from official databases (BERD) and 
EU-financed  projects  (e.g.  SRS  NET:  Scientific  Reference  System  on  new  energy 
technologies, energy end-use efficiency and energy RTD; and ERMINE: Electricity Research 
Road Map in Europe) as well as other literature, as sketched out in Figure 4. This is described 
in more detail in the following sections.  

EN 

12 

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(cid:46)
(cid:46)

Identify key EU companies by technology
Identify key EU companies by technology

Sources: Experts; breakdown of a sector’s turnover by company
Sources: Experts; breakdown of a sector’s turnover by company
Sources: Experts; breakdown of a sector’s turnover by company

☺
☺

R&D expenditure of the company
R&D expenditure of the company

Sources: EU Industrial R&D Scoreboard; Annual Reports
Sources: EU Industrial R&D Scoreboard; Annual Reports
Estimation for companies that are not listed on the stock exchange
Estimation for companies that are not listed on the stock exchange

YES
YES

Is the company 
Is the company 
active in one 
active in one 
technological 
technological 
field only?
field only?

NO
NO

Allocate 100% of its 
Allocate 100% of its 
R&D expenditures 
R&D expenditures 
to the relevant 
to the relevant 
technology
technology

☺
☺

(cid:47)
(cid:47)

Allocate a certain 
Allocate a certain 
part of the 
part of the 
company’s R&D 
company’s R&D 
expenditure to the 
expenditure to the 
technology
technology

Sum of R&D 
Sum of R&D 
expenditure by 
expenditure by 
technology
technology

Approximate R&D expenditures by technology
Approximate R&D expenditures by technology

Approaches: Through direct contact; 
Approaches: Through direct contact; 
Additional information from the company, e.g.:
Additional information from the company, e.g.:
Corporate Social Responsibility reports; 
Corporate Social Responsibility reports; 
speeches; plans;
speeches; plans;
experts involvement;
experts involvement;
assessment of R&D outcome (e.g. patents)
assessment of R&D outcome (e.g. patents)
Application of R&D investments per R&D employee;
Application of R&D investments per R&D employee;
Check with ‘comparable’ companies;
Check with ‘comparable’ companies;
Use of other studies
Use of other studies

Additional information sources: 
Additional information sources: 
Eurostat BERD
Eurostat BERD
SRS Project
SRS Project
ERMINE project
ERMINE project
Proxies derived from turnover
Proxies derived from turnover
New Energy Finance
New Energy Finance

Note: ☺ indicate the level of certainty of the step / information underlying the step
Note: ☺ indicate the level of certainty of the step / information underlying the step

Figure 4: 

Schematic  overview  of  the  methodology  applied  for  estimating  corporate  R&D 
investments by technology 

Source:  JRC-IPTS 

3.2.1.2.  Breaking down corporate R&D investments  

As  introduced  above,  an  allocation  of  individual  companies'  annual  R&D  investment  to  the 
various technologies of interest was the central approach followed in the present report.  

The EU Industrial R&D Investment Scoreboard proved to be the single most important data 
source  for  obtaining  basic  information  on  annual  corporate  R&D  investments  (Hernández 
Guevara et al., 2008), which was used as a starting point for the subsequent assessment. The 
data  analysed  relate  to  the  companies  R&D  investments  in  2007.  The  EU  Industrial  R&D 
Investment Scoreboard provides data on investment in R&D from 2000 companies (1000 EU-
based  and  1000  non-EU  based).  It  is  prepared  from  companies'  annual  audited  reports  and 
accounts11. The companies are grouped by sectors of activity following the ICB classification 
(Industry  Classification  Benchmark).  Companies  are  allocated  to  the  country  of  their 

11 

A general concern raised with regard to assessing R&D expenditures based on the companies' annual 
reports is that the figures may include the parts financed through public budgets, thus creating problems 
with double-counting (SRS project, 2007). This problem does, however, not occur for the Scoreboard 
database, which only includes the R&D financed by the company as a general principle. If disclosed, 
the  externally  funded  R&D  parts  (i.e.  by  public  sector  as  well  as  companies  outside  the  group)  are 
deducted. In case that a company does not disclose the part of the R&D that has been externally funded, 
it cannot be deducted and the public part is thus included in the company's investment, thus accepting a 
slight systematic error. 

EN 

13 

   EN 

 
 
                                                 
registered  office,  which  may  differ  from  the  operational  or  R&D  headquarters  in  some 
cases12. 

The  Scoreboard's  breakdown  by  field  of  activity  does  not  allow  for  the  technology-oriented 
grouping  required  for  this  work.  Furthermore,  Jacquier-Roux  and  Bourgeois  (2002)  showed 
that  much  of  the  R&D  efforts  relevant  for  the  energy  sector  are  being  carried  out  by  the 
supplier  of  energy  equipment,  making  the  energy  sector  a  supplier-dominated  sector  in  the 
taxonomy  developed  by  Pavitt  (1984).  In  order  to  capture  the  R&D  investments  of  the 
different  types  of  companies,  the  present  report  therefore  had  to  identify  a  number  of 
companies that are considered relevant for research in a certain SET-Plan priority technology 
instead of relying on existing classifications of companies (such ICB or NACE, the statistical 
classification  of  economic  activities).  The  assessment  of  the  present  report  is  thus  based  on 
the estimation of R&D budgets from both traditional energy companies – such as 'oil and gas 
producers';  'electricity';  'gas,  water  and  multiutilities'  following  the  ICB  classification  –  and 
companies  that  are  active  in  sectors  like  'alternative  energy';  'automobiles  and  parts'; 
'chemicals';  'construction  and  materials';  'electrical  components  and  equipment';  'industrial 
machinery'; 'industrial metals'; and 'general industrials'. 

For each of the technological fields of interest, key industrial EU-based companies have been 
identified.  This  has  been  based  on  analyses  of  the  various  markets  (e.g.  through  the 
barometers  from  EUROBSERV'ER  2008a-c),  expert  knowledge  and  other  sources  (such  as 
the  members  of  Technology  Platforms  or  associations;  companies'  internet  websites).  Of 
course, a number of companies are active in various fields simultaneously, which meant that 
they figure in various 'technology groups' at the same time. 

Such  an  approach  bears  the  risk  of  missing  a  central  player  for  R&D  as  the  selection  is 
strongly  based  on  the  market  share  of  companies.  However,  a  large  market  share  does  not 
necessarily  imply  a  high  R&D  intensity.  This  is  supported  by  the  fact  that  innovation  may 
happen on the component supplier side rather than within the known energy companies. Since 
the lists of companies that are considered within a certain field are not exhaustive, neglecting 
minor  players  that  might,  in  sum,  provide  a  far  greater  R&D  commitment;  they  tend  to 
underestimate the total R&D efforts dedicated to SET-Plan technologies.  

Overall, a total of 136 companies were identified as central R&D investors on the SET-Plan 
priority  technologies,  a  large  number  of  which  being  simultaneously  active  in  several  SET-
Plan  technologies.  72  of  the  136  companies  identified  are  listed  among  the  TOP1000  R&D 
investors of the Scoreboard, allowing the direct extraction of R&D investment data. However, 
for  four  of  them,  no  further  breakdown  of  the  R&D  investment  by  technology  could  be 
performed.  Some  of  the  companies  of  interest  are  smaller  overall  R&D  investors  and 
therefore do not rank among the TOP1000 R&D investors; as they are nevertheless important 
for  a  certain  (smaller)  technological  field,  an  in-depth  research  has  been  carried  out  by 
looking  at  a  more  detailed  database  containing  some  7000  companies,  which  is  the  basis 
underlying  the  EU  Scoreboard.  Data  for  12  companies  was  extracted  from  this  extended 
database.  A  web-based  search  provided  some  information  for  26  additional  enterprises 

12 

Note  that  the  way  in  which  corporate  R&D  investments  are  allocated  to  countries  can  significantly 
influence  the  outcome  of  the  analysis.  The  EU  Industrial  R&D  Investment  Scoreboard  allocates 
companies to the country of their registered office, while BERD refers to all R&D activities performed 
by  businesses  within  a  particular  sector  and  territory,  regardless  of  the  location  of  the  business’s 
headquarters. This important difference needs to be kept in mind when comparing results from different 
studies one with another.  

EN 

14 

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through e.g. annual reports or other information for those companies that are not listed on the 
stock exchange and thus are not obliged to publish their financial report. Haug et al. (2009) 
provided  information  for  nine  additional  companies  active  in  research  on  CSP.  Combining 
data  from  the  various  sources,  data  were  available  for  115  out  of  the  136  companies 
identified. 

The R&D Investment Scoreboard does not allocate the R&D investments to individual energy 
technologies.  For  companies  being  active  mostly  in  one  technological  field  (e.g.  Vestas  for 
wind power), one may assume that their R&D investment remains within their main field of 
business  activity.  This  has  been  the  case  for  around  25  companies,  for  which  the  R&D 
investments by technological field could thus be identified with a high accuracy. For another 
eight companies, a very high confidence level could be obtained in the assumptions made in 
the present analysis building on information from official sources (see also section 4.3). 

For  large  companies  operating  in  manifold  areas,  however,  the  amount  of  research 
investments that is dedicated to a certain technology cannot be directly derived from the R&D 
Investment  Scoreboard.  This  is  the  case  in  particular  for  car  manufacturers,  oil  companies, 
electric  utilities,  and  large  component  manufacturers.  For  this  reason,  the  Scoreboard  data 
proved  to  be  of  more  direct  help  in  the  areas  of  PV  and  wind  than  for  CCS,  biofuels  or 
hydrogen/fuel cells, with large multinational utilities and oil businesses being more active in 
the latter fields. 

For the purpose of this report, the R&D investments of multi-business companies was divided 
up and allocated to the different technologies on the basis of assumptions. Companies' annual 
reports  and  corporate  sustainability  reports  were  systematically  analysed  for  additional 
information  on  the  breakdown  of  R&D  investments.  Moreover,  the  websites  of  individual 
companies and associations were screened for further information, enhanced by free searches 
that  revealed  e.g.  presentations  and  speeches  from  company  key  actors  or  press  releases.  In 
very few cases, newspaper articles provided helpful information. For some companies, work 
that had previously been carried out at DG RTD and TREN has been used as input (Naneva 
and  Paschos,  2008).  In  addition,  information  from  literature  (New  Energy  Finance,  2008; 
PWC et al., 2007) was used as a starting point. Furthermore, some 30 companies or industry 
associations were contacted. This direct contact allowed obtaining exact figures for four large 
companies, and helped to refine assumptions for another handful of companies. 

In the easiest cases, this additional information revealed the allocation of the R&D investment 
to the different technologies. For most companies, however, the R&D expenditures could be 
narrowed down to a particular field (e.g. 'renewables') with a certain accuracy but then needed 
to  be  further  split  between  the  various  renewable  energy  sources  based  on  qualitative 
information. In that cases, some substantiated "guess-timates" had to be performed in order to 
allocate their R&D investment to single technologies, based on information available for the 
individual companies obtained through the sources described above. 

This  included,  for  example,  the  number  of  researchers  by  field  that  allowed  a  rough 
estimation  of  the  R&D  investments  by  applying  an  average  R&D  investment  per  research 
employee.  Figure 5  shows  information  on  R&D  investment  per  research  employee  gathered 
for  31  companies  or  research  centres.  An  average  investment  of  €120000  to  €150000  per 
research  employee  was  found  for  55%  of  them.  This  range  was  then  used  for  further 
estimates, unless more precise figures could be obtained for the specific company. 

EN 

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18

16

14

12

10

8

6

4

2

0

i

i

s
e
i
r
i
a
d
s
b
u
s
s
e
n
a
p
m
o
c

/

i

f
o
r
e
b
m
u
N

[90-120]

[120-150]

[150-180]

>180

R&D investm ent per research em ployee (in k€)

Figure 5: 

Distribution of R&D investments per research employee 

Source:  JRC-IPTS based on a variety of information sources 

Other  companies  announced  some  future  R&D  investment  plans,  which  were  subsequently 
"extrapolated" back to the 2007 data. In few cases, the substantiated assumptions were applied 
to other, similar companies as well. Often, the R&D expenditures could be narrowed down to 
a  certain  field  (e.g.  'renewables')  with  a  certain accuracy  but  then  needed  to  be  further  split 
between the various renewable energy sources based on qualitative information. 

For  some  selected  important  R&D  investors,  patent  applications  have  been  used  as  an 
indicator  of  the  R&D  breakdown.  Based  on  the  assumption  that  patents  may  reflect  a 
company's  research  effort,  which  is  supported  by  assessment  that  show  a  significant 
correlation  between  patents  and  R&D  spending  (e.g.  Griliches,  1990;  Jaumotte  and  Pain, 
2005), the distribution of patents across the relevant technologies was used as a proxy for the 
distribution of its R&D expenditures. Of course, linking input indicators such as energy R&D 
spending to output indicators (such as patents13) faces a number of problems. These occur in 
particular  as  the  'energy  sector'  includes  a  broad  variety  of  technologies  and  industries  with 
distinct characteristics regarding the research intensity needed for a patent and the propensity 
to  patent.  In  addition,  the  tendency  to  patent  may  also  differ  across  countries.  As  a 
consequence,  the  average  R&D  intensity  per  patent  may  differ  considerably  across 
technologies. Companies may also decide to classify or label patents in a way that makes it 
difficult to detect them with the simplified patent assessment applied in this report.  

Despite these general constraints regarding the use of patents, they may nevertheless be used 
as  a  rough  indicator  within  the  scope  of  this  report,  given  that  studies  show  a  strong 
correlation  between  the  number  of  energy-related  patents  granted  and  the  energy  R&D 
investments (Margolis and Kammen, 1999; Johnstone et al., 2008).14 However, it needs to be 
mentioned that within the present report the patent-based approach could not be exploited in 
full. For the above-mentioned reasons, this would have required an in-depth assessment of the 

13 

14 

The  outputs  of  research  are  manifold,  ranging  from  the  better  understanding  of  presently  used 
techniques  to  finding  new  technologies  and  attracting  public  research  funding  (see  overview  table  in 
Ernst,  H.,  1998,  p.3).  The  use  of  patents  for  measuring  R&D  outputs  may  thus  fall  short  of  the 
complexity  of  the  motivations  for  research,  but  can  nevertheless  be  used  as  a  suitable  indicator 
(Griliches  et  al.,  1986;  Griliches,  1990).  However,  Ernst  (1998)  shows  that  research  does  not 
necessarily lead to more patents, but to patents of higher quality.  
Popp (2005) shows that patents are a suitable mean for obtaining R&D activity in highly disaggregated 
forms. 

EN 

16 

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contents  of  each  patent  instead  of  using  a  search  by  keyword  and  the  inclusion  of  patent 
applications that were handed in by subsidiaries.  

Additional information has been derived from a detailed database of EU-FP6 projects and was 
used for cross-checking the R&D investment of selected companies in e.g. CCS and H2/FC. 
From  this,  the  contribution  of  a  company  within  a  certain  technological  field  could  be 
deducted  by  summing  up  the  company's  contribution  in  all  projects  within  a  certain  area. 
These figures were only used for verifying that the results of the other approaches lie above it 
– if that had not been the case, the estimations would have had to be revisited. 

3.2.1.3.  Illustration of the approach 

In the following, the methodology applied in this report shall be illustrated. The 'wind energy' 
sector  is  a  representative  example  for  an  area  in  which  the  approach  allows  a  relatively 
accurate analysis.  

Table 1  shows  a  selection  of  EU-based  industries  that  are  considered  of  outstanding 
importance  in  the  area  of  wind  energy.  For  these  industries,  the  R&D  investment  has  been 
extracted  from  the  EU  Industrial  R&D  Investment  Scoreboard  and  other  sources.  A  first 
limitation of the analysis is due to the fact that some important companies are missing, such 
as some large electric utilities that carry out wind energy R&D, even though one may safely 
assume  that  much  of  the  innovation  is  carried  out  by  the  component  suppliers  that  are 
included.  A  crucial  step  lies  in  the  breakdown  of  the  R&D  budgets  and  the  allocation  of 
contributions  to  the  different  technologies,  as  described  in  detail  for  the  cases  of  Acciona, 
Alstom, Dong Energy, EDF, Iberdrola and Siemens.  

EN 

17 

   EN 

 
Company name 

Total R&D 
investment 
2007 (€m) 

Assumed 
share of 
R&D to 
wind 

Assumed 
R&D 
investment 
in wind 
(€m) 

Acciona Energy 

39.02 

24% 

~9.5 

Alstom 

561 

4.5% 

~25 

Clipper 

Windpower 

6.89 

100% 

6.9 

Dong Energy 

64.24 

20% 

~13 

Assumptions 

Sources 

Acciona states that €16.3m of its R&D budget  (i.e. 42%) is dedicated to energy R&D. 
The company is largely active in wind energy and solar (PV and CSP), but also in H2 
and bioenergy (solid biomass and biofuels). Given the importance of wind energy, we 
assume that slightly more than half of the energy-related R&D budget is allocated to 
wind energy, i.e. €9-10m.  

Alstom  is  a  major  component  supplier  for  power  generation  and  transport.  R&D 
activities  in  the  power  sector  are  carried  out  through  the  two  sub-sectors  "Power 
Systems"  (mainly  CCS  and  gas/steam  turbines  R&D)  and  "Power  Services".  Wind 
energy would classify under the first. An analysis based on the number of researcher, 
the split of turnover between the various financial sectors and literature (ZEP, 2008a), 
leads to an estimated R&D investments within "Power Systems" in the order of €200-
220m. Out of this, some share would be dedicated to wind energy. As a rough guess, 
we  assume  that  some  10%  of  the  'Power  Systems  R&D'  would  go  to  wind  energy 
research  (ca.  €20m).  Moreover,  the  Alst om  Group  acquired  100%  of  Ecotècnia  in 
2007, a Spanish wind turbine company. From a newspaper article (El Pais) we know 
that  Ecotecnia  will  invest  around  2%  of  its  turnover  in  R&D  (ca.  €5m).  In  total,  we 
thus assume that some €25m are  dedicated to wind energy R&D. 

Industrial 

Investment 
EU 
R&D 
total  R&D 
Scoreboard  for  data  on 
investment; 
on 
based 
assumptions 
Acciona's  annual  and  corporate  social 
Furthermore, 
reports. 
responsibility 
through  direct  contact  the  assumed  R&D 
break-down could be improved. 

reports, 

Industrial 

Investment 
R&D 
EU 
total  R&D 
Scoreboard  for  data  on 
investment; 
on 
based 
assumptions 
Alstom's  annual  and  corporate  social 
their  websites, 
responsibility 
patent  analysis,  newspaper  and  expert 
guesses.  Furthermore, 
through  direct 
contact  the  assumed  R&D  break-down 
could  be  improved.  However,  figures  are 
not official figures from the company but 
remain own estimates. 

Mostly active in wind energy, thus 100% of R&D is assumed to go to wind. 

Wind energy is central for Dong Energy. The company states that it currently accounts 
for  the  largest  proportion  of  wind  energy  in  Europe  and  plans  massive  new 
investments.  However,  coal  and  other  renewables  also  play  a  key  role  for  Dong 
Energy: the company is very active in CCS (see e.g. Castor FP6 project) and second 
generation biofuels (e.g. from straw). Furthermore, we know that Dong Energy intends 
to  invest  around  DKK350m  (€46.8m)  in  R& D  of  sustainable  energy,  including 
renewables  and  CCS.  On  this  basis,  we  roughly  assume  that  1/5  of  Dong  Energy's 
R&D budget is allocated to wind.  

Industrial 

EU 
Scoreboard 

R&D 

Investment 

Industrial 

Investment 
EU 
R&D 
total  R&D 
Scoreboard  for  data  on 
investment; assumptions based on Dong's 
annual and corporate social responsibility 
reports and expert estimates. 

EN 

18 

 
 
 
 
 
Company name 

Total R&D 
investment 
2007 (€m) 

Assumed 
share of 
R&D to 
wind 

Assumed 
R&D 
investment 
in wind 
(€m) 

EDF 

375 

0.8% 

~3 

Enercon 

n.a. 

n.a. 

~17.5 

Assumptions 

Sources 

Out of the total R&D budget, EDF invested around €100m on 'environment', including 
energy  eco-efficiency,  research  into  Renewable  Energies,  local  impact  of  climate 
change,  and  other  studies  furthering  knowledge  of  environmental  issues.  Out  of  this, 
renewables  (excl.  hydro)  account  for  9%  according  to  official  data.  Based  on 
information of EDF's R&D efforts on PV, we estimate that around €5.5m are dedicated 
to  R&D  on  wind  energy,  biomass,  geothermal  and  ocean  power.  Given  the 
perspectives  of  wind  energy  within  EDF,  we  assume  that  half  of  that  is  dedicated  to 
wind energy research. 

Industrial 

Investment 
EU 
R&D 
Scoreboard  for  data  on 
total  R&D 
investment;  assumptions  based  on  EdF's 
annual and corporate social responsibility 
reports, their websites and expert guesses. 

Furthermore,  through  direct  contact  the 
assumed  R&D  break-down  could  be 
improved.  However,  figures  are  not 
official  figures  from  the  company  but 
remain own estimates. 

Enercon's  turnover  was  in  the  order  of  €2.4bn  in  2007.  According  to  their  website, 
Enercon employs around 10000 people and over 130 engineers in R&D. If we assume 
R&D expenses per R&D employees to be in the typical range of €120000-150000 per 
R&D staff, Enercon's R&D expenses were in the order of €15.6m to €19.5m spent in 
R&D,  with  the  central  value  taken  for  this  report.  However,  this  would  mean  that 
Enercon's R&D intensity remains low at less than 1% of the turnover. For this reason, 
the above estimate may well be an under-estimation. 

Website 

Internet pages 

Gamesa 

30.91 

100% 

30.9 

Mostly active in wind energy, thus 100% of R&D is assumed to go to wind. 

Industrial 

EU 
Scoreboard 

R&D 

Investment 

EN 

19 

 
 
 
 
 
Company name 

Total R&D 
investment 
2007 (€m) 

Assumed 
share of 
R&D to 
wind 

Assumed 
R&D 
investment 
in wind 
(€m) 

Iberdrola 

65 

6.2% 

~4 

Assumptions 

Sources 

Iberdrola spent €65m in R&D in 2007. According to their website, Iberdrola plans to 
invest  €225m  in  R&D  over  the  period  2008- 2010  (i.e.  €75m  per  year)  on  the  three 
following activities: 1) Renewables (€70m)  and deregulated power business (€70m); 2) 
Regulated  business  (€50m);  3)  Informa tion  technology  and  other  areas  (€35m). 
Considering  that  on  the  one  hand,  wind  power  plays  an  important  role  in  Iberdrola's 
renewables portfolio but on the other hand, Iberdrola is also active in other renewable 
energy sources (such as solar thermal and biomass) and on grid integration, we assume 
that  20%  of  the  €70m  announced  for  Renewable  Energy  research  would  go  to  wind 
energy  over  the  3  years  (i.e.  €4.7m  per  year).  We  also  know  that  the  R&D  figures 
announced for 2008 (and beyond) imply a 15% increase to the 2007 figures. If we thus 
assume that the 2007 wind energy R&D investment is 15% below the above-estimated 
figure for 2008, the R&D investment on wind energy in 2007 can be estimated to be 
some €4m.  

Nordex 

17.24 

100% 

17.2 

Mostly active in wind energy, thus 100% of R&D is assumed to go to wind. 

REPower Systems 

13.38 

100% 

13.4 

Mostly active in wind energy, thus 100% of R&D is assumed to go to wind. 

Siemens 

3366 

0.6% 

~21 

For SIEMENS, several approaches have been combined:  

Firstly,  SIEMENS  annual  report  states  that  15%  (i.e.  €505m)  of  its  total  R&D 
investments  are  dedicated  to  energy  research.  The  energy  sector  is  made  up  of  6 
divisions,  one  of  which  is  the  renewable  energy  division,  including  wind  energy. 
Knowing the total staff by division and for wind, the relation of total staff to total R&D 
personnel (ca. 5.5%-9% across the various sectors) and the R&D investments per R&D 
employee (€132000 per R&D employee in the  energy sector), we estimate that R&D 
investments dedicated to wind research may be some in the range of €16-27m (i.e. 0.5-
0.8% of total R&D). 

Secondly,  a  research  in  patent  databases  showed  that  0.5%  (depatisnet)  and  1.2% 
(USPTO) of all SIEMENS patent applications in 2004-2006 were associated with wind 
energy.  

EN 

20 

Industrial 

Investment 
EU 
R&D 
total  R&D 
Scoreboard  for  data  on 
on 
based 
assumptions 
investment; 
Iberdrola  Press  Release  24/03/2008  and 
official  reports.  Furthermore, 
through 
direct  contact  the  assumed  R&D  break-
down  could  be 
improved.  However, 
figures  are  not  official  figures  from  the 
company but remain own estimates.\ 

Industrial 

EU 
Scoreboard 

Industrial 

EU 
Scoreboard 

R&D 

Investment 

R&D 

Investment 

Industrial 

EU 
R&D 
Investment 
total  R&D 
Scoreboard  for  data  on 
investment; assumptions based on various 
inputs,  such  as  annual  and  corporate 
social  responsibility  reports  and  work 
done  by  Naneva  and  Paschos  (2008); 
press 
application 
assessment. 

releases; 

patent 

 
 
 
 
 
 
 
Company name 

Total R&D 
investment 
2007 (€m) 

Assumed 
share of 
R&D to 
wind 

Assumed 
R&D 
investment 
in wind 
(€m) 

Assumptions 

Sources 

Thirdly,  Siemens  maintains  wind  turbine  R&D  centres  in  Denmark,  Germany,  the 
Netherlands, UK and the USA. For the newly opened USA centre we know that they 
aim at a staff number of some 50 researchers, but currently only have 12. Assuming a 
similar number of researchers for all centres would give a total number of employees 
of 212 people. With an average investment of €132000 per researcher, this would mean 
an R&D investment of €28m. 

From the approaches above, we deduce that the share of R&D dedicated to wind may 
be in the order of 0.5-0.8%. We use 0.6% as best guess, yet with high uncertainties. 

Vergnet 

n.a. 

100% 

~3.7 

In  2007,  Vergnet's  turnover  was  €37m  out  of  which  10%  were  dedicated  to  R&D 
activities, meaning that around €3.7m were spent in R&D for the same year. Moreover, 
Vergnet  had around  20  engineers  in  R&D  in  2007  .  Assuming  that  €150000  is spent 
per R&D employee, on average, this would mean that their R&D expenses account for 
€3m  which  is  in  line  with  the  €3.7m.  We  assume  that  most  of  this  investment  was 
allocated to wind energy. 

Vergnet website 

Oseo website (08/2008) 

Vestas Wind 

127 

100% 

127 

Mostly active in wind energy, thus 100% of R&D is assumed to go to wind. 

Industrial 

EU 
Scoreboard 

R&D 

Investment 

Total 

~292 

Table 1: 

Example of the approach, illustrated for the wind energy sector 

Source:  JRC-IPTS  based  on  data  on  total  R&D  investments  from  the  EU  Industrial  R&D  Investment  Scoreboard  (except  for  Enercon  and 
Vergnet).  Assumptions  on  the  share  of  total  R&D  investments  dedicated  to  research  on  wind  energy  are  based  on  a  variety  of  sources, 
including companies' annual reports and corporate social responsibility report as well as websites and direct contact where possible.  

Note:  Data  on  the  R&D  investment  in  wind  energy  are  own  estimates  and  are  related  to  uncertainties.  They  do  not  present  any  official 
company figure.  

EN 

21 

 
 
 
 
 
 
 
  
  
3.2.2.  BERD (Business enterprise sector's R&D expenditure) 

In order to complement the company-based information obtained through the Industrial R&D 
Investment  Scoreboard,  the  Eurostat/OECD  BERD  (Business  enterprise  sector's  R&D 
expenditure)  database  has  been  searched  for  data  on  corporate  R&D  investment.  BERD 
contains  figures  on  the  business  enterprise  sector's  expenditure  in  R&D,  broken  down  by 
different  socio-economic  objectives  following 
the  NACE  (Rev  1.1)  classification. 
Furthermore,  the  expenditures  are  broken  down  by  sources  of  funds,  disaggregated  into 
business enterprise sector (BES), government sector (GOV), higher education sector (HES), 
private non-profit sector (PNO) and abroad (ABR). 

Within the present report, the energy-related BERD data have been assessed for funds from 
all  sources  and  those  funds  that  stem  from  the  business  enterprise  sector  BES.  The  latter 
would be more comparable to the central approach of this report, which assesses the corporate 
R&D investments that stem from the companies' funds (to the extent that the publicly funded 
parts can be identified and subtracted, see footnote 10). 

Unfortunately,  the  NACE  classification  does  not  provide  the  technological  breakdown 
required  for  this  report.  For  this  reason,  the  BERD  results  on  the  corporate  energy-related 
R&D  expenditures  could  only  be  used  for  comparison  with  the  aggregate  figure  of  the 
analysis based on the method described in section 2.1.1. Table 2 shows those sectors that are 
considered as relevant in the context of energy-related R&D as assessed in this report15. 

The  BERD  database  often  misses  data  for  several  EU  Member  States  at  the  high  level  of 
detail  that  is  required  for  this  work,  which  makes  it  difficult  to  obtain  a  comprehensive 
picture. In a number of cases, entries by category are not available for a certain country in the 
last  year,  but  for  some  years  before.  These  gaps  for  2007  were  filled  with  the  latest  data 
available  back  to  the  year  2003.  Even  though  this  approach  leads  to  an  error,  the  mistake 
made  seems  to  be  smaller  than  assuming  no  R&D  expenditure  for  those  countries  where 
entries are missing.  

15 

Note  that  the  NACE  classes  chosen  in  the  present  assessment  comprise  more  categories  than  only 
classical  energy  sectors  (see  the  selection  in  Kaloudis  and  Pedersen,  2008).  A  broader  approach  was 
chosen in order to also capture companies that are active in the manufacturing of energy components, 
and thus enhance the comparability with the central approach of this study. 

EN 

22 

   EN 

 
                                                 
Mining and quarrying  
Manufacture of coke, refined petroleum products and nuclear fuel  
Manufacture of engines & turbines, except aircraft, 
vehicle & cycle engines  
Manufacture of electric motors, generators and transformers  

Manufacture of electricity distribution and control apparatus  
Manufacture of insulated wire and cable  
Manufacture of accumulators, primary cells and primary batteries  

Manufacture of lighting equipment and electric lamps  
Manufacture of electrical equipment n.e.c.  
Electricity, gas and water supply  
Total Energy-Related BERD 
Total EU27 Business and Enterprise R&D expenditure  
Share of energy-related over total BERD 

Funds from 
all sectors 
(€ million) 
584 
865 

382 

554 
1029 
129 
74 
416 
969 
702 
5703 
144089 
4.0% 

BES funds 
only (€ million) 

191 
288 

58 

209 
513 
49 
37 
50 
365 
434 
2194 
105754 
2.1% 

Table 2: 

Business  and  enterprise  R&D  expenditures  in  energy-related  fields  in  2007  aggregated 
for EU Member States 

Source: BERD (data retrieved in January 2009) 

Note: Data gaps in 2007 have been filled with entries for 2003-2006 where necessary. Less data is available for 
'funds by BES' than for 'all funds', thus distorting the aggregates.  

3.2.3.  Other research projects 

Two research projects were used as information sources on industrial energy R&D spending, 
namely the ERMINE project16 and the SRS NET & EEE project17. IPTS accessed the reports 
and databases and contacted the project coordinators for clarifications. 

The SRS NET & EEE (Scientific Reference System on new energy technologies, energy end-
use  efficiency  and  energy  RTD)  project  aimed  at  enhancing  the  availability,  quality  and 
completeness  of  data  on  new  energy  technologies  and  energy  efficiency  and  at  producing 
unbiased,  validated,  organised  and  scientifically  agreed  technical  and  economic  information 
on renewable and efficient technologies. As part of this work, an extensive database on R&D 
expenditure was constructed. 

The  database  contains  public  and  private  energy  R&D  expenditure  up  to  the  year  2005. 
Private R&D data are taken from several sources such as specific studies, R&D programmes, 
activity  reports,  etc.  and  are  available  for  wind  energy,  CCS,  H2/FC  and  nuclear  (fission). 
Note that PV is included within the "solar energy" technology. 

The  approach  used  is  presented  in  the  "R&TD  Countries'  Reference  Report"  (SRS  project, 
2007), which includes the name of the sources and their quality level for every Member State. 
Unfortunately, data on private R&D spending are only available for a limited number of EU 
countries. In some cases, this lack of data unfortunately means that countries that are central 
for a given technological field are not covered. 

16 
17 

http://www.ermine.cesiricerca.it/ 
http://srs.epu.ntua.gr/ 

EN 

23 

   EN 

 
 
 
                                                 
For public R&D investment, the SRS project primarily used the IEA database in conjunction 
with other sources such as Eurostat or various studies. See van Beeck et al. (2009) for a more 
detailed overview of the project results and data gathering procedures. 

Given  the  difficulties  encountered  in  collecting  information  on  private  R&D  efforts,  one  of 
the project's conclusions is that "The data collection on ERTD expenditures in Europe would 
be  facilitated  with  the  appointment  of  a  European  institution  that  ensures  a  systematic 
collection of validated and disaggregated data on public and private ERTD expenditures. For 
a comprehensive database, it is vital that such an institution has enough power and prestige, 
in particular to urge companies to provide data on private expenditures." 

As  part  of  the  ERMINE  (Electricity  Research  Road  Map  in  Europe)  project,  a  database  on 
R&D  expenditure  in  the  EU  electricity  sector  has  been  created  based  on  various  prime 
resources and direct contact to companies (de Nigris et al., 2008). A central part of the data 
collection  consisted  of  questionnaires  sent  to  the  main  actors  of  the  EU  electricity  sector 
(government  institutes,  universities,  research  centres,  electricity  companies,  etc.).  Public 
energy R&D budgets are primarily taken from the IEA database (but calculated in euro 2004 
which may explain some differences to the results of the SRS database). The ERMINE data 
have been used for verifying the order of magnitude of the results of the present work to the 
extent possible. 

3.2.4.  New Energy Finance 

New  Energy  Finance18  offers  an  on-line  desktop  with  information  on  investors  and 
transactions  in  clean  energy.  A  core  part  of  this  service  is  based  on  an  extensive  database 
containing  information  on  financial  transactions,  such  as  private  equity  and  venture  capital. 
Unfortunately, the database does not contain explicit data on R&D expenditure. 

However, New Energy Finance recently published an analysis on R&D investments in clean 
energies  as  part  of  the  publication  'Global  Trends  in  Sustainable  Energy  Investment  2008' 
(Boyle et al., 2008) and as a Research Note (New Energy Finance, 2008). The data are based 
on the information of 47 companies, mainly extracted from their annual and corporate social 
responsibility reports. Similarly to the main approach used in this report (see section 2.1.1), 
the R&D expenditures are allocated to the country that hosts the company's headquarters. To 
the extent possible, the publicly financed part of the corporate R&D investments is subtracted 
(similar to the EU Scoreboard). 

According  to  these  studies,  global  R&D  spending  into  renewable  energy  technologies  and 
energy efficiency has increased slightly from 2006 to 2007 to reach a total of US$16.9 billion. 
Of  this,  corporate  R&D  accounted  for  US$9.8  billion  and  public  R&D  for  US$7.1  billion 
(Boyle et al., 2008). In 2006, the EMEA (Europe, Middle East and Africa) region accounted 
for US$4.8 billion of corporate research in clean energy technologies in 2006, with the largest 
part  coming  from  energy  and  utility  companies  followed  by  technology  and  automobile 
sectors (New Energy Finance, 2008). 

Note that the assessment done by New Energy Finance defines the category 'clean energy' in a 
much broader way than how this report defines 'SET-Plan priority technologies'. The category 
'clean energy' also includes energy efficiency R&D efforts as well as co-generation, but does 

18 

www.newenergyfinance.com 

EN 

24 

   EN 

 
                                                 
not  include  nuclear.  Unfortunately,  no  further  breakdown  of  clean  energy  research  into 
individual technologies has been available. However, the clean energy investments that were 
provided for a number of large companies have been used as one input for the allocation of 
those  companies'  R&D  budgets  to  individual  technologies  in  the  present  report  (see  section 
2.1.1) and for comparing the order of magnitude of the results of the present report. 

3.2.5.  Methodological outlook 

The uncertainties related to the various approaches pursued in this report are described above. 
In  the  following,  suggestions  are  made  on  how  to  further  enhance  the  accuracy  of  the 
outcome: 

•  Firstly, and despite the methodological problems related to linking R&D output to -input 
indicators  (see  above  with  further  references),  an  in-depth  analysis  of  companies'  patent 
applications may provide useful additional – yet not sufficient – information from which to 
derive  an  indication  of  their  R&D  directions.  However,  such  an  assessment  would  also 
need to pay attention to systematic problems such as the fact that some sectors are more 
"patent-intensive"  than  others  and  that  the  specific  R&D  costs  per  patent  differ  between 
technologies.  

•  Secondly, a company's current (and announced future) positioning across various business-
fields  may  provide  some  insights  into  the  areas  of  research  that  could  be  regarded  as 
strategic. The Compustat database, a database of 88000 companies worldwide maintained 
by Standard and Poor's, may be of use here.  

•  Finally  and  probably  most  importantly,  a  systematic  and  ongoing  direct  contact  to 
companies and associations beyond the scope of this report would be needed for validating 
the assumptions used.  

EN 

25 

   EN 

 
3.3.  Member States' public R&D investments 

Unlike the estimation of corporate R&D investments in energy technologies, the assessment 
of  public  energy  R&D  investments  in  Member  States  is  primarily  based  on  available 
supranational datasets, which has been enhanced by the use of some national data which result 
from the direct contact with EU Member States. The following two datasets have been used as 
the principal starting points: the Eurostat GBAORD and the IEA RD&D statistics. They will 
be described in more detail in the following. 

The Eurostat GERD (Gross Domestic Expenditure on R&D) database19, which contains R&D 
expenditure  by  R&D  performers,  could  not  be  used  as  its  breakdown  does  not  provide  the 
level of detail on different energy technologies required for this report. 

3.3.1.  GBAORD (Government Budget Appropriations or Outlays on R&D) 

Government  Budget  Appropriations  or  Outlays  on  R&D  are  all  appropriations  allocated  to 
R&D in central government or federal budgets. It is also recommended that provincial or state 
government  should  be  included  when  its  contribution  is  significant,  while  local  government 
funds should be excluded (OECD, 2002). Data are collected from government R&D funders 
and  maintained  by  Eurostat  and  the  OECD  and  follows  the  NABS  (Nomenclature  for  the 
Analysis and Comparison of Scientific Programmes and Budgets) classification.  

Socio-economic objective 5 'Production, distribution and rational utilisation of energy' is the 
most  relevant  main  category  for  the  present  report.  It  covers  research  into  the  production, 
storage,  transportation,  distribution  and  rational  use  of  all  forms  of  energy.  It  also  includes 
research  on  processes  designed  to  increase  the  efficiency  of  energy  production  and 
distribution, and the study of energy conservation. 

For this report, data for 2007 have been used mostly. Due to major data gaps that would have 
hampered  a  comprehensive  analysis  at  the  EU-27  level,  a  simple  gap  filling  procedure  has 
been applied using data from the latest available years back to the year 2003. This is noted in 
detail in the notes below the figures presenting the results of this analysis.  

The 4-digit level of detail provided by the GBAORD database can be considered as accurate 
enough  for  the  objectives  of  this  report  (see  Table 3).  Unfortunately,  disaggregated  data  on 
GBAORD energy subgroups were only available for the Czech Republic, Germany, Ireland, 
Greece, Spain, Malta, the Netherlands, Romania, Slovenia and the UK20. This means that for 
some  of  the  major  energy  R&D  funding  Member  States  such  as  France  or  Italy  no  data  is 
available  at  this  disaggregated  level,  inhibiting  an  aggregated  figure  on  the  EU-27  Member 
States' public R&D investment by technology (see Figure 6).  

19 

20 

GERD is maintained by Eurostat/OECD on the basis of data collected from all R&D performers. It has 
a sectoral breakdown (BES: business and enterprise, GOV: government, HES: higher education; PNP: 
private non-profit).  
In the case of IE and MT the reported values are zero. 

EN 

26 

   EN 

 
                                                 
SUBSECTORS OF PRODUCTION, DISTRIBUTION AND RATIONAL UTILISATION OF ENERGY" (CATEGORY 5) 

GBAORD 
code 

500 

501 
502 

503 

504 
505 
 * 5051 
 * 5052 
 * 5053 

 * 5054 

506 

509 

GBAORD term 

Term used in this analysis 

waste 

including 

management 

General research on production, distribution, and rational 
utilization of energy 
Fossil fuels and their derivatives 
Nuclear fission 
Radioactive 
decommissioning with regard to fuel/energy 
Nuclear fusion 
Renewable energy sources 
Solar thermal and photovoltaic energy 
Geothermal energy 
Water, wind and wave energy 
Research  into  biomass  conversion  (particularly  into  the 
areas  of  pyrolysis,  gasification,  extraction  and  enzyme 
processing);  research  on  the  processing  of  waste  from 
industry, agriculture and the domestic sector with a view 
to energy 
Rational utilization of energy 
Other  research  on  production,  distribution  and  rational 
utilization of energy 

General research on energy 

Fossil Fuels 
Nuclear fission 

Radioactive waste 

Nuclear fusion 
RES 
Solar 
Geothermal 
Water, wind & wave 

Biomass 

Rational utilisation 

Other 

Table 3: 

Classification of energy-relevant sectors in GBAORD 

Source: GBAORD 

n
o

i
l
l
i

m

800

700

600

500

400

300

200

100

0

FR

DE

IT

ES

NL

SE

FI

DK

BE

HU

UK

AT

CZ

Production, distribution and rational util.of energy (main category 5, no further breakdown available)
Rational utilisation of energy
Renewables
Nuclear fusion
Radioactive waste management
Nuclear fission
Fossil Fuels
Other energy subsectors
General research on energy

Figure 6: 

Distribution of energy-related R&D budgets of EU Member States, 2007 

Source: GBAORD (data retrieved from Eurostat in January 2009) 

Note: No data for BG. Gap-filling was applied by using 2006 data for CZ, DE, ES (all sectors) and UK (500, 
501, 503, 505, 506); 2005 data for NL (501) and HU (category 5); 2004 data for SI (all sectors), UK (502, 509) 
and NL (509). 

EN 

27 

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€
 
 
3.3.2. 

IEA RD&D statistics 

The  International  Energy  Agency  (IEA)  hosts  a  publicly  accessible  database  on  energy 
RD&D budgets from the IEA member countries. Data is collected from government RD&D 
funders.  

Unlike  the  GBAORD,  the  IEA  database  covers  demonstration  activities  on  top  of  pure 
research  and  development  activities.  'Demonstration  projects'  are  of  large  scale,  but  are  not 
expected  to  operate  on  a  commercial  basis  (IEA,  2008).  In  practice,  however,  most  IEA 
member countries do either not provide data on funds directed towards demonstration, or do 
not display them separately. As a consequence, the aggregated demonstration activities of EU 
Member States that are explicitly specified us such in the IEA database amount to some 9% of 
total  R&D  activities  of  these  countries  in  2007  (gap-filled),  yet  with  important  differences 
across technologies as shown in Figure 3 (see also section 3.1 for a further clarification of the 
scope covered by the present assessment). For the purpose of this report, we thus consider the 
IEA data as mainly related to R&D investments. 

The breakdown of the IEA R&D data follows a scientific/technical nomenclature21. The level 
of  detail  more  or  less  matches  the  requirements  of  this  report.  Furthermore,  most  countries 
provided data at this high level of detail, which renders the IEA database central for this work. 

Only  19  of  the  27  EU  Member  States  are  IEA  members.  Consequently,  the  database 
systematically  contains  no  data  for  the  other  countries,  i.e.  for:  Bulgaria,  Cyprus,  Estonia, 
Latvia, Lithuania, Malta, Romania, and Slovenia. Nevertheless, the aggregated R&D budgets 
of the Member States covered by the IEA database account for almost 99% of the overall EU-
27 energy budget according to GBAORD data, thus limiting the errors incurred by a lack of 
data in the missing EU Member States, notwithstanding that the contributions of the excluded 
Member States may be higher for individual technologies.  

The latest available data are for the year 2007. Similar to the procedure applied for GBAORD 
data,  some  straight  forward  'gap  filling'  process  was  applied  for  the  IEA  data.  For  entries 
missing for 2007, the value from the latest available year was applied down to the year 2003; 
data  older  than  2003  were  not  considered.  This  means  that  IEA  data  for  Greece  (latest 
available year at detailed level: 2002), and Luxembourg (2000) were neglected. In the case of 
Finland and the Netherlands, mainly 2006 data have been used. For the Czech Republic and 
the Slovak Republic 2003 data were used. This approach slightly distorts the overall picture 
(see section 4.3), but is nevertheless justified given that the main interest of this report lies on 
the  aggregated  EU  figures.  Stemming  from  the  consultation  process  with  Member  States,  it 
was decided to use national figures for the year 2007 in the case of France, the UK, Germany, 
Austria and Belgium22, either replacing the IEA figures or complementing them. In the case 
of  Ireland,  it  was  decided  to  use  official  national  figures  for  the  year  2006  as  proxy  for  the 
R&D investments in the year 2007 instead of using the data from the IEA RD&D statistics. 

21 

22 

See  also  European  Commission  (2005)  for  a  comparison  of  energy  R&D  statistics  in  the  European 
Union. 
Note that in Belgium, nuclear-related R&D (fusion and fission) is under federal responsibility namely 
through  the  DG  Energy  by  the  FPS  Economy,  while  administration  of  non-nuclear-related  R&D 
activities is the main responsibility of the regional governments. The non-nuclear energy R&D figures 
thus are the aggregate of the regional funds.  

EN 

28 

   EN 

 
                                                 
In  addition  to  the  2007  figures,  an  average  of  the  national  R&D  investments  over  the  time 
span  2002-2007  is  displayed  in  most  of  the  charts  shown  in  the  report.  This  supplementary 
information prevents the risk of giving too much weight to data mavericks and one-off events 
while at the same time providing a longer term perspective. 

3.4. 

EU FP6 public energy R&D investments 

European  funds  complement  the  Member  States'  public  R&D  support.  The  Research 
Framework Programme and EURATOM Framework Programme are the key source of R&D 
financing  on  energy  technologies.  Other  EU  funding  schemes  such  as  the  Competitiveness 
and  Innovation  Programme  with  its  pillar  Intelligent  Energy  Europe,  the  Cohesion  funds, 
Trans-European  Networks,  etc.  could  either  not  be  assessed  quantitatively  on  the  level  of 
detail  needed  for  this  report,  or  were  considered  less  relevant  for  research  as  they  mainly 
focus on deployment. They are mentioned in box 1. 

For the purpose of this report, the expenditures23 of the 6th Research Framework Programme 
and the EURATOM Framework Programme 2002-2006 have been analysed. As FP6 ended in 
2006,  detailed  data  on  R&D  expenditures  are  available  on  a  project  level,  which  allows  a 
decent allocation of R&D spending to the various technology types. Such detailed data is not 
yet  available  for  FP7,  thus  preventing  the  use  of  FP7-figures  for  an  in-depth  assessment. 
Nevertheless,  some  detail  is  provided  on  the  evolution  of  energy-related  R&D  investments 
from FP6 to FP7 to allow for an assessment of future trends. The reflections on FP7 are based 
on the budget decisions taken so far.  

The  breakdown  of  the  FP6  investments  has  not  been  based  on  the  budget  lines  (such  as 
'Sustainable  Energy  Systems'),  as  this  would  not  provide  the  level  of  detail  required  by  the 
present work. Instead, individual projects have been allocated 'manually' to the various SET-
Plan  priority  technologies,  which  allowed  estimating  the  total  EU-funded  expenditures  for 
various  technologies  under  FP6.  The  assessment  systematically  includes  all  projects  funded 
within of the core budget line used for energy-R&D projects (Sustainable Energy Systems); to 
the  extent  possible  it  has  been  complemented  by  other  energy-relevant  projects  that  are 
funded through other budget lines (e.g. 'sustainable surface transport' or 'horizontal research 
activities  involving  SMEs')  based  on  various  publications  (European  Commission,  2004; 
2007b-e).  This  allocation  approach is  associated  with  (limited)  uncertainty  as  some  projects 
simultaneously address various technologies (e.g. projects on alternative motor fuels comprise 
work on biofuels, H2 and natural gas; projects on integrating fluctuating renewable electricity 
sources may be allocated to renewables or to grids). In those cases, a decision was taken on to 
which  technology  the  expenditures  should  be  allocated.  Even  though  this  process  creates  a 
potential source of error (see section 4.3.2) it is justified as it avoids a double-counting of the 
budget of one single project. In future work, one may go a step further and allocate fractions 
of the project budget to individual technologies; this would nevertheless require an in-depth 
knowledge  of  the  contents  of  each  project.  Despite  the  uncertainties  related  to  the  present 
approach,  a  comparison  with  other  sources  (Rossetti  di  Valdalbero  et  al.,  2007;  European 
Commission,  2007b-e;  Langlois  D'Estainot,  2009;  EPIA,  2007;  Orion  Innovations,  2008; 
Filiou et al., 2009) does reveal only limited differences. 

Note  that  the  analysis  of  EURATOM  funds  is  based  on  budgets.  Furthermore,  not  only 
project-related funds have been included but also the JRC funds dedicated to nuclear energy. 

23 

The assessment is based on commitments, not payments. 

EN 

29 

   EN 

 
                                                 
As  the  EU  Research  Framework  Programmes  are  of  multiannual  nature,  while  the  present 
report  aims  at  presenting  the  EU  R&D  investments  for  the  most  recent  year  available,  they 
had  to  be  broken  down  further  in  order  to  determine  the  specific  budgets  available  for  one 
single year. In order to level out annual fluctuations in the budget that are due to the project 
cycles, it was decided to assume an even allocation of the total expenses to every year of the 
FP6 duration (the financially effective duration of FP6 was four years). The figures shown for 
the EU public R&D investment thus relate to an average annual investment over the years of 
the duration of FP6. 

4. 

RESULTS 

4.1. 

Overall results 

Overall, the findings of this report indicate that already today, substantial R&D investments 
are  directed  towards  low-carbon  energy  technologies,  in  particular  from  industry.  Public 
research funding in EU Member States complements corporate R&D investments. However, 
the  share  of  energy-related  research  in  the  total  of  public  research  remains  limited  for  most 
Member States. 

towards  selected  non-nuclear  SET-Plan  priority 
The  aggregated  R&D  spending 
technologies24 amounted to €2.38 billion in 2006/7, out  of which €1.66 billion originate from 
corporate  R&D  investments  in  2007,  while  €0.57  billion  stem  from  public  national  R&D 
budgets in EU Member States in 200725 and €0.16 billion are financed through the European 
6th Research Framework Programme26 in 2006 (see Figure 7). 

ca. €2.38 billion

69%

Corporate R&D investment (2007) 

Public EU (FP6; annual average)

Public R&D spending of EU Member
States (2007)

24%

7%

Figure 7: 

Indicative R&D investment in non-nuclear SET-Plan priority technologies from industry 
(2007), the public national sector (2007) and EU funds through FP6 (2006) 

Source:  Corporate  data  result  from  the  present  analysis  carried  out  by  JRC-IPTS;  public  national  data  from 
IEA, complemented with direct information from some Member States; EU data from FP6. 

24 

25 

26 

Technologies  included  are:  hydrogen  and  fuel  cells;  wind  energy;  photovoltaics;  carbon  capture  and 
storage; biofuels; smart grids and concentrating solar power. 
The public R&D budgets of EU Member States are taken from the IEA R&D statistics. They refer to 
the year 2007, but data gaps were filled with data from earlier years back to 2003. Note that the IEA 
statistics miss data for a number of EU Member States. 
The  payment  commitments  under  the  Sixth  EC  Framework  Programme  were  assumed  to  be  evenly 
spread over the years of its duration. Note that the (annualised) energy-related R&D budget of FP7 is 
substantially above that of FP6.  

EN 

30 

   EN 

 
 
                                                 
This  is  complemented  by  the  nuclear  R&D  budget,  for  which  no  single  figure  can  be 
provided as it was not possible to narrow down R&D investments to research on generation 
IV reactors, which are the focus of the nuclear fission related activities within the SET-Plan. 
Nevertheless, some distinction could be made between the total nuclear-related budgets and a 
limited  nuclear  R&D  budget  excluding  e.g.  research  on  environmental  protection,  waste 
storage  and  safety  considerations,  which  narrow  down  the  nuclear  research  on  plain  reactor 
technologies that are considered to include research on generation IV. Following the narrow 
approach,  reactor-related  research  investments  may  be  around  €0.46  billion,  while  the  total 
nuclear fission R&D budgets including research on all nuclear energy-related would exceed 
€1.2 billion. Fusion related research adds  another €0.48 billion to this figure. 

The  central  figure  taken  in  the  following  as  estimate  for  the  total  R&D  investments  in  all 
(nuclear  and  non-nuclear)  low-carbon  technologies  highlighted  by  the  SET-Plan  therefore 
amounts to €3.3 billion .  

4.1.1.  Corporate R&D investments 

The central approach used in this report leads to an estimate of around €1.86 billion in 2007 
of total corporate R&D investment in the low-carbon technologies considered (nuclear + non-
nuclear SET-Plan priority technologies).27 This meant an increase in the order of magnitude 
of  some  15%  compared  to  the  roughly  estimated  R&D  investment  in  the  year  2006  (for 
limitations of this comparison see box 3). 

Corporate  R&D  investments  are  spread  throughout  most  EU  Member  States.  Nevertheless, 
the headquarters of companies with a substantial R&D investment in low-carbon technologies 
are  largely  concentrated  in  a  few  Member  States,  namely  Germany,  France,  UK,  Denmark, 
Spain and Sweden, which together account for almost 95% of the total. Note, however, that 
this picture may be distorted by uncertainties associated with the methodology applied.  

Italy

Austria

Others

Belgium

Finland

Sweden

Spain

Germany

Denmark

UK

~ €1.9 
billion

France

Figure 8: 

Indicative  regional  distribution  of  corporate  R&D  investment  (2007)  in  SET-Plan 
priority  technologies  by  countries  that  host  the  headquarters  of  the  R&D  investing 
companies 

Source: JRC-IPTS 

Note: Figures are subject to important uncertainties. The associate to countries is done at the basis of location 
of headquarters, not on the basis of location of the R&D activities.  

27 

This figure would rise to some €2.2 billion if all  nuclear-related R&D efforts were included, i.e. also 
those related to radiation safety and waste management.  

EN 

31 

   EN 

 
 
                                                 
Source 

This report 

BERD 

New Energy 
Finance 

ERMINE 

SRS 
NET&EEE 

Sectoral 
coverage 

Total  selected 
low-carbon 
technologies 

Business- 
and 
Enterprise  R&D 
in 
expenditure 
energy-related 
fields 

Energy 

Clean 
R&D 
Investment 
including 
energy 
efficiency 
excl. nuclear 

R&D 
investments in 
power 
generation (all 
technologies) 

but 

private 

All 
energy 
research 

Geographical 
coverage 
Corporate  R&D 
(€ billion) 

EU 

1.9 

EU 

EMEA 

5.7 (2.2 if only 
funds by BES) 

3.5 

EU 

3.9 

EU 

2 

Table 4: 

Comparison of results across various studies 

Despite  the  uncertainties  associated  with  the  approach,  a  comparison  to  the  results  of  other 
studies (see Table 4) supports the approximate size of this outcome while at the same time it 
confirms that this figure should be considered as rough estimate only. 

•  According  to  the  New  Energy  Finance  assessment,  the  corporate  investment  in  clean 
energy  technologies  amounted  to  around  US$4.8  billion  (ca.  €3.5  billion)  in  2006  in  the 
EMEA  region.  A  large  part  of  the  discrepancy  with  the  findings  of  this  report  may  be 
explained  by  the  broader  definition  of  clean  energies  applied,  which  comprises 
substantially  more  technologies  than  the  few  considered  in  this  report  such  as 
improvements of energy efficiency, even if nuclear technologies have not been included. 
The difference in the geographical boundaries may be considered as of limited importance. 

•  The  ERMINE  project  found  for  2004  an  overall  R&D  investment  of  the  EU  electricity 
her industries. A large part of this (€3.9 

supply industry of €1 billion and €7.5 billion of ot
billion) was attributed to R&D in the power generation sector, yet comprising all and not 
only low-carbon technologies.  

•  According to the SRS project results, industry spent around €2 billion in energy research. 
Note that the latter database contains important gaps and may thus be an underestimation. 

•  According to the Eurostat BERD database, the business and enterprise R&D expenditures 
for various energy-related sectors amounted to €5.7 billion in 2007 (gap filled; see Table 
2).  Note  that  this  aggregated  figure  likely  constitutes  a  low  estimate  as  data  for  some 
Member States are missing at the high level of detail. In order to make these figures more 
comparable to the central approach used within this report, only the R&D expenditures that 
are funded by the business enterprise sector should be compared. These would amount to 
around  €2.2  billion  for  energy-related  sector s.  However,  this  is  most  probably  an 
underestimation, given that the data availability is worse for data broken down by source 
of funds than for expenditures financed from all funds. If, therefore, we assumed that the 
share  of  energy-related  R&D  expenditures  within  total  BERD  (4%)  is  similar  for 
investments from all funders and those from the business sector only, the business sector 
funded energy-related R&D expenditures would amount to €4.2 billion. The BERD figure 
would then more or less confirm the order of magnitude of the results obtained, bearing in 
mind the data problems and the fact that the technologies considered in the present report 
are a small but innovation-intensive subset of all energy technologies. Furthermore, unlike 
the  EU  R&D  Investment  Scoreboard,  the  BERD  figures  relate  to  R&D  investments 
performed by business on a certain territory, while disregarding the geographic location of 
the headquarters. 

EN 

32 

   EN 

 
4.1.2.  Public R&D investments by Member States 

Overall spending on energy R&D 

The total energy-related public R&D spending in the EU Member States amounted to €2.56 
billion or €2.52 billion in 2007 according to th e GBAORD and IEA databases, respectively. 
This amount is less than half of the energy-related public R&D budgets in 1985 due to a sharp 
decline in the 1980s and early 1990s in particular of nuclear energy R&D, but is well above 
the low spending of the late 1990s/early 2000s (see Figure 10).  

Note  that  the  IEA  RD&D  statistics  and  the  energy-related  parts  of  the  GBAORD  in  theory 
cannot  directly  be  compared  as  the  IEA  database  includes  demonstration  on  top  of  R&D 
activities. In practice, however, budgets for demonstration activities are provided only by few 
IEA  members,  amounting  to  about  9%  of  the  total  on  the  aggregated  EU  level  (see  section 
3.1). 

Table 5 shows the overall energy-related R&D budget by EU Member State according to the 
GBAORD  and  IEA  Member  States.  It  becomes  obvious  that  public  energy  R&D  largely 
concentrates  on  a  few  Member  States.  The  aggregated  energy  R&D  budgets  of  France, 
Germany and Italy account for around 65% of the aggregated budget from all Member States 
according to both the GBAORD and the (modified) IEA databases. Relative to GDP, France 
and Finland are spending the highest energy R&D investments among the EU Member States 
(based on GBAORD data). In general, however, the differences among EU Member States are 
of  limited  nature.  Compared  with  the  Japanese  public  energy  R&D  budget  appropriations 
(0.11%  of  GDP  in  2006),  the  aggregated  EU  figure  (0.02%  of  GDP  in  2007,  almost 
unchanged from 2006) reveals an enormous difference in the importance attributed to energy 
R&D. 

Setting  the  energy-related  part  of  the  GBAORD  in  relation  to  the  overall  GBAORD  can 
provide an indication of the importance of energy in a country's overall research budgets. The 
result is presented in Figure 9. On an EU aggregated level, the share of energy R&D in total 
R&D budgets was 2.9% in 2007, with only few Member States showing a substantially higher 
share (such as Hungary). This compares to a share of 15.2% in Japan and of 1.1% in the USA. 
Note,  however,  that  a  comparison  between  individual  EU  Member  States  and  Japan  or  the 
USA  is  distorted  due  to  the  fact  that  the  budgets  from  the  EU  Research  Framework 
Programme are not included, which can play an important role e.g. for nuclear fusion. 

EN 

33 

   EN 

 
D
&
R

t
e
g
d
u
b
V
O
G

l

a
t
o
t

f
o
e
g
a
t
n
e
c
r
e
P

16

14

12

10

8

6

4

2

0

11.6

(1982) *

9.4
(1985) *

4
(1990)

2.9
(2007)

*

*

U
H

I

R F
F

T

I

V
L

E
S

O
R

T
L

S
E

L
N

E
D

K
D

Z
C

E
E

R
G

E
B

T
A

T
P

I

L S
P

U
L

K
U

Y
C

K
S

E

I

T
M

S
U

P
J

7
2
U
E

Figure 9: 

Share  of  energy-related  R&D  funding  (i.e.  production,  distribution  and  rational 
utilisation of energy) in the overall public  R&D funding in selected EU Member States, 
Japan and the USA (2007)  

Source: GBAORD  

Table 5 reveals differences in the aggregated EU totals between the GBAORD and the IEA 
databases in the order of €40 million, despite th e fact that one might have assumed the IEA 
figures to be larger due to their (partial) inclusion of demonstration activities on top of R&D. 
Parts  of  the  difference  may  be  explained  by  the  distinct  regional  coverage  of  the  databases, 
which  stems  from  the  fact  that  not  all  EU  Member  States  are  IEA  members.  Other 
dissimilarities  relate  to  the  sectoral  breakdowns  with  GBAORD  following  the  NABS 
nomenclature  and  the  IEA  a  scientific/technological  structure28.  With  regard  to  individual 
countries, important discrepancies between the two databases can be observed in particular for 
Spain and the UK, but also for Denmark, Germany and France. From a methodological point 
of  view,  Table 5  illustrates  the  differences  made  by  the  gap-filling  procedure  explained  in 
section 2.2 and discussed further in section 4.3.2. In this report, however, a number of gaps 
could be filled through direct contact with the Member States, thus reducing the need for gap 
filling.  

28 

Moreover,  even  though  both  database  ask  for  provincial  (e.g.  Länder)  R&D  spending  to  be  included 
when  significant,  there  may  be  differences  in  the  extent  to  which  this  data  is  being  submitted  by  the 
Member States. For many countries, this data is not in the data submitted to the IEA (see also section 
2.2.2). 

EN 

34 

   EN 

 
 
 
 
 
 
 
                                                 
GBAORD for "Production, 
distribution and rational 
utilization of energy" (2007)1) 2) 

Public budget for energy RD&D, IEA (2007), gap-filled 3) 4) 

€ million 

% of EU total 

No gap filling; 2007 
data  
(€ 2007 million) 

Gap filling up to 
2003 & with 
national data 
( € 2007 million) 

31.7 

38.4 

n.a. 

0.1 

20.2 

47.5 

1.9 

78.1 

760.1 

542.7 

13.4 

34.1 

0.0 

1.2% 

1.5% 

n.a. 

0.0% 

0.8% 

1.9% 

0.1% 

3.0% 

29.7% 

21.2% 

0.5% 

1.3% 

0.0% 

359.5 

14.0% 

2.7 

3.1 

0.5 

0.0 

118.5 

8.2 

10.5 

14.8 

0.2 

1.0 

350.0 

90.5 

32.6 

0.1% 

0.1% 

0.0% 

0.0% 

4.6% 

0.3% 

0.4% 

0.6% 

0.0% 

0.0% 

13.7% 

3.5% 

1.3% 

2560.3 

100.0% 

31.9 

94.3 

n.a. 

99.7 

n.a.5) 

867.2 

414.4 

5.6 
- 6) 

354.5 

n.a. 

2.0 

70.6 

87.5 

220.8 

2248.5 

Average 
2002-07 
(€ 
million) 

34.1 

n.a. 

% of 
total 

1.3% 

3.7% 

% of 
total 

1.6% 

n.a. 

31.9 

94.3 

Not IEA member 

Not IEA member 

7.0 

99.7 

0.3% 

4.0% 

n.a. 

59.3 

n.a. 

2.8% 

Not IEA member 

102.9 

867.2 

414.4 

n.a. 

5.6 

16.3 

4.1% 

34.4% 

16.4% 

0.2% 

0.6% 

83.9 

847.5 

378.7 

3.9% 

39.4% 

17.6% 

4.4 

10.9 

0.2% 

0.5% 

354.5 

14.1% 

326.8 

15.2% 

not IEA member 

not IEA member 

n.a. 

not IEA member 

147.4 

5.8% 

139.2 

6.5% 

n.a. 

2.0 

0.1% 

2.4 

0.1% 

not IEA member 

n.a. 

not IEA member 

70.6 

87.5 

220.8 

2.8% 

3.5% 

8.8% 

59.0 

90.6 

116.1 

2.7% 

4.2% 

5.4% 

2522.1 

100% 

2149.5 

100% 

2616.7 

104% 

2363.3 

110% 

Austria 

Belgium 

Bulgaria 

Cyprus 

Czech Rep. 

Denmark 

Estonia 

Finland 

France 

Germany 

Greece 

Hungary 

Ireland 

Italy 

Latvia 

Lithuania 

Luxemburg 

Malta 

Netherlands 

Poland 

Portugal 

Romania 

Slovak Rep. 

Slovenia 

Spain 

Sweden 

UK 

Total EU 

US (IEA data) 

JP (IEA data) 
Table 5: 

125% 
Total energy-related R&D budgets in EU Member States, the USA and Japan according 
to the GBAORD and IEA databases 

2505.8 

2680.8 

99% 

Source: GBAORD, IEA (based on data retrieved in January 2009), manipulated as described below 

1) Gap-filling back to 2003, details on gap filling in the main sheet of each technology. 

Notes 
2) Data on GBAORD energy for HU from 2005; Data for PT, UK and IT come from 2006. 
3) Gap-filling in the IEA data is the following: 2007 for DK, HU, IT, PT, ES, SE (excl. smart grids for 2003), the 
US and Japan; 2006 for FI (excl. CSP for 2004), NL (excl. CSP for 2003); 2003 for CZ; No or very limited data 
for SK (2003), GR (last in 2002), LU (last in 2000) and PL (no data). Note that data for the year 2007 have been 
taken directly from national sources instead of the IEA for the following Member States: AT, DE, UK, FR and 
BE.  
4) No average values over the period 2002-2007 have been estimated for BE, CZ and GR due to limited time 
series data (data available for one year only). 
5) Official national data for Finland show that the total Finnish energy R&D investment increased by around 
40% between 2006 and 2007 to reach €142.8 million. As , however, no official breakdown by technology could 
be obtained for the year 2007, the present assessment is based on data from 2006 instead. 
6) Official national figures for 2006 were used as proxy for the year 2007 (instead of using IEA data). 

EN 

35 

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Overall, the above figures indicate that in absolute numbers public energy-related research in 
the EU is still concentrated on relatively few Member States. The aggregated Member States 
public  energy-related  R&D  budget  saw  an  increase  compared  to  its  minimum  in  the  late 
1990s/early 2000s, but still remains far below its values from two decades ago, largely due to 
declining nuclear energy R&D funds. Despite the renewed increase in recent years, the share 
of the EU's total budget dedicated to energy-related research (yet excluding the funds of the 
EC through e.g. the Framework Programmes) was limited (2.9%) and well below its share in 
the early 1980s (around 12%) or 1990 (4%). 

R&D spending in SET-Plan priority technologies 

Despite an overall decreasing energy research budget over the past two decades (with a slight 
uptake  in  more  recent  years,  see  Figure 10),  investments  in  non-nuclear  SET-Plan  priority 
technologies have been more or less stable throughout the 1990s with an increase afterwards. 
In  2007,  Member  States  invested  around  €570  m illion  in  R&D  related  to  the  non-nuclear 
SET-Plan  priority  technologies,  some  35%  of  their  total  public  non-nuclear  energy  R&D 
budgets. 

R&D to non-nuclear SET-P priority technologies
R&D to non-nuclear SET-P priority technologies

Other non-nuclear energy R&D
Other non-nuclear energy R&D

Nuclear energy R&D
Nuclear energy R&D

8%
8%

11%
11%

2007 (Gap filled)
2007 (Gap filled)

6%
6%

7%
7%

H2/FC
H2/FC

30%
30%

PV
PV

Wind
Wind

Transport
Transport
biofuels
biofuels
Smartgrids
Smartgrids

CCS
CCS

CSP
CSP

14%
14%

3% 3%
3% 3%

6%
6%

24%
24%

Energy efficiency
Energy efficiency

RES (excl. PV,
RES (excl. PV,
CSP, wind, biofuels)
CSP, wind, biofuels)

33%
33%

6000
6000

5000
5000

4000
4000

3000
3000

2000
2000

1000
1000

s
s
t
t
e
e
g
g
d
d
u
u
b
b
D
D
&
&
R
R
c
c
i
i
l
l

b
b
u
u
p
p
d
d
e
e
t
t
a
a
g
g
e
e
r
r
g
g
g
g
A
A

)
)
n
n
o
o

i
i
l
l
l
l
i
i

m
m

7
7
0
0
0
0
2
2

(€
(€

0
0
1985
1985

1986
1986

1987
1987

1988
1988

1989
1989

1990
1990

1991
1991

1992
1992

1993
1993

1994
1994

1995
1995

1996
1996

1997
1997

1998
1998

1999
1999

2000
2000

2001
2001

2002
2002

2003
2003

2004
2004

2005
2005

2006
2006

2007
2007

Source data: IEA
Source data: IEA

14%
14%

19%
19%

32%
32%

Fossil fuels (excl.
Fossil fuels (excl.
CCS)
CCS)

Other energy R&D
Other energy R&D

Electric power
Electric power
conversion
conversion

Energy system
Energy system
analysis
analysis

Energy storage
Energy storage

22%
22%

Nuclear
Nuclear
fission
fission

Nuclear
Nuclear
fusion
fusion

68%
68%

Figure 10: 

Trends in the aggregated public energy R&D funding of EU Member States (1985-2007; 
excluding EU funds) and detailed breakdown for the year 2007 

Source:  JRC-IPTS  based  on  IEA  data  (retrieved  in  January  2009),gap  filled  and  complemented  by  official 
national data for some Member States 

Note: The 2007 figures include the filling of data gaps with data from back to 2003. Note that no modification 
was  undertaken  to  e.g.  account  for  differences  related  to  the  changes  in  the  French  methodology  for  data 
between 1990 and 2002 (see also section 4.3.2), the fact that German data do not include the new Länder prior 
to 1992 or missing data for Belgium for the years 2000-2006. For the year 2007, both national (DE, FR, UK, 
AT, BE) and IEA data have been considered and gaps were filled for only FI, NL and CZ. For Ireland, official 
national data for the year 2006 have been used instead of the 2007 figures from the IEA database. Only 19 of the 
27 EU Member States are IEA members, meaning that data for 8 Member States are systematically missing; for 
others, data for some years may be missing. 

EN 

36 

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In 2007, France, Italy and Germany are the largest European public investors in the selected 
non-nuclear  SET-Plan  priority  technologies,  followed  by  the  UK,  Denmark,  Spain  and  the 
Netherlands  (see  Figure 11).  The  distribution  of  research  spending  towards  the  individual 
technologies,  however,  varies  substantially  across  the  Member  States,  reflecting  different 
constraints with regard to the natural potential of renewable energy technologies, the current 
energy mix and its historical developments and industrial capacities.  

The EU funds through FP6 (€157 million; see sect ion 3.1.3 for more details) are in the order 
of  the  top  investing  Member  State.  Adding  those  funds  to  the  aggregated  Member  States 
funding would bring the EU's total public R&D investment to non-nuclear SET-Plan priority 
technologies to €728 million.  

This would put the EU ahead of comparable R&D budgets in the USA (€437 million in the 
USA) and Japan (€187 million; see Figure 11), despit e the fact that both regions have slightly 
higher  total  energy  R&D  budgets  (see  Table 5).  Such  a  pure  quantitative  comparison, 
however, is misleading due to the important differences in the way in which energy R&D is 
being carried out in the different regions.  

Public R&D spending in non-nuclear SET-P priority technologies 
1- 2007 data (gap filled)
2- Annual average over the period 2002-2007

]
n
o

i
l
l
i

m

180

7
0
0
2

160

[
y
g
o

l

o
n
h
c
e
t

y
b
t
n
e
m
t
s
e
v
n

i

D
&
R
c
i
l

b
u
P

140

120

100

80

60

40

20

0

Total bioenergy minus biofuels

CO2 Capture and Storage

Transport Biofuels

Solar Thermal Power and High Temp. Apps

Photovoltaics

Wind Energy

Electricity Transm. & Distr. (Smart Grids)

H2 and Fuel cells

1

1

2

1

1

2

2

1

2

1

2

2

1

2

1

2

1

1

2

1

2

1

2

1

2

2

1

1000

900

800

700

600

500

400

300

200

100

0

Austria Finland Belgium SwedenNetherlands Spain Denmark

UK

Germany

Italy

France EU FP6
(avg per
year)

Japan USA EU

(MS+FP6)

Figure 11: 

Aggregated  public  support  to  selected  non-nuclear  SET-Plan  priority  technologies  of 
some EU Member States (and FP6 funds), the USA and Japan  

Source:  JRC-IPTS  based  on  IEA  RD&D  statistics,  gap  filled  and  complemented  by  official  national  data  for 
some Member States as described below; FP6 

Note: The R&D investments of Slovakia, the Czech Republic, Portugal, Ireland and Hungary are not displayed 
as  they  would  not  be  visible  at  the  scale  used  in  this  chart.  They  are  nevertheless  respected  in  the  present 
assessment.A  comparison  between  countries  suffers  from  data  gaps  as  the  IEA  database  missed  data  for  a 
number  of  EU  Member  States.  Gap  filling  for  EU  applied  with  data  from  back  to  2003.  Older  data  for  e.g. 
Greece and Luxembourg are not included and were dismissed. Furthermore, data on regional R&D investments 
are often not included. Also relevant energy R&D that is being carried under non-energy research programmes 
(e.g.  basic  research)  is  not  included  for  many  countries. Data  are  complemented by or  modified  according  to 
national statistics in the case of Germany, France, the UK, Austria and Belgium. For Ireland, official national 
data for the year 2006 have been used instead of the 2007 figures from the IEA database.The latest available 
IEA data for the USA are for 2002 for PV and CSP. Hence, 2007 data were taken from US DOE (2008) and 
Curtright et al. (2008). No annual average is provided for BE due to a lack of data over the period 2002-2007 

EN 

37 

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€
 
 
(only 2007 was available).For FP6, commitments have been assessed at the project level and then annualised 
over  the  effective  duration  of  FP6  as  described  in  detail  in  section  3.1.3.Even  though  the  present  analysis 
focuses  on  transport  biofuels  rather  than  total  bioenergy-related  R&D,  an  indication  of  the  latter  is  also 
provided in the chart. This seems necessary given that many countries provide data on bioenergy research, but 
not on the sub-category 'biofuels' even though it would be sensible to assume for a number of countries that a 
substantial part of bioenergy research is dedicated to biofuels R&D.  

Unlike the strongly focussed and coordinated energy technology policies in the USA through 
the  Department  of  Energy  (DoE)  and  Japan  through  the  Ministry  for  Economy,  Trade  and 
Industry (METI), no single European programme exists for fostering low-carbon technologies 
(with the exception of fusion related research).  

Pan-European cooperation is hampered by diverse organizational structures in energy R&D, 
ranging  from  the  institutional  set-up  to  programmes  and  public  private  partnerships 
(Wiesenthal  et  al.,  2008).  Non-aligned  research  strategies  and  sometimes  subcritical 
capacities, the variety of national regulations and technical specifications tend to fragment the 
market and inhibit industry investments in high-risk technologies. Even though a number of 
recent  initiatives  aim  at  improving  both  the  science-industry  link  and  cooperation  among 
Member States, current procedures remain far away from a coherent strategic priority setting 
at pan-European level that would enable to exploit synergies in energy R&D. 

Recent initiatives such as the ERA-NETs have started to tackle this problem. So far, however, 
NETWATCH29 data indicate that transnational R&D co-operation in low carbon energy R&D 
has  been  rather  limited  until  now.  Under  FP6,  energy  R&D  represented  7%  of  the  whole 
ERA-NET  activity30,  or  5 ERA-NETs  in  5  different  low  carbon  energy  areas.  22  countries 
have  been  involved:  19  EU  Member  States  and  3  associated  countries,  Norway  being  very 
active  with  3  participations.  In  general,  the  EU  Member  States  being  most  active  in  ERA-
NETs  stem  from  the  group  of  large  energy  R&D  investors  (see  Table 5).  Germany  and  the 
Netherlands  participate  in  all  5  co-operations,  and  also  coordinate  all  energy  ERA-NETs. 
Sweden, Denmark, Austria, Spain, France and United Kingdom participate in 4 of them. Italy 
is underrepresented with participation in only 1 energy-related ERA-NET. The new Member 
States  on  average  participate  in  only  in  1  ERA-NET  in  this  field,  Poland  leading  with  2 
participations and 1 observer role. 

The  fields  covered  by  the  FP6  ERA-NETs  are  photovoltaic  solar  energy  (PV-ERA-NET), 
innovative energy technologies (INNER), hydrogen and fuel cells technology (HY-CO), clean 
energy fossil technologies (FENCO-ERA) and bio-energy (BIOENERGY). Most of the calls 
had  a  clear  experimental  character  and  were  used  by  the  ERA-NETs  to  develop  and  test 
possible  strategies  of  future  cooperation.  Between  2006  and  2008,  these  five  ERA-NETs 
launched 11 joint calls. The time from the start of the ERA-NETs to the first call is about 2 
years,  which  seems  to  be  a  standard  in  all  ERA-NETs,  not  only  in  energy.  Future 
transnational co-operation initiatives will therefore have to take into account a certain delay in 
the launch of first calls. All calls were funded through a virtual pot mode, enabling countries 
and  regions  to  apply  existing  national  procedures  and  to  pay  for  their  own  participants, 
without trans-national flows of national funding. The budget committed by these five ERA-
NETs  to  the  11  joint  calls  has  been  €23.3  million,  equalling  a  mere  4  %  of  the  total 

29 

30 

NETWATCH  is  a  Central  Information  Platform  on  Transnational  R&D  Programme  Collaboration, 
being constructed by IPTS and contracted by DG RTD. 
Note  that  for  comparison  purposes,  other  energy  related  ERA-NETs  such  as  ERA-NET  Transport  or 
ERA-Build  are  not  included  since  in  earlier  surveys  of  DG-RTD  they  were  not  attributed  to  this 
thematic field. 

EN 

38 

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aggregated  public  budget  that  Member  States  dedicated  to  R&D  on  non-nuclear  SET-Plan 
priority technologies in 200731. 

Overall,  the  assessment  indicates  that  despite  important  steps  towards  an  increased 
collaboration in energy research, the EU may not be using the full potential for innovation of 
the  internal  market  by  exploring  synergies  between  Member  States  in  the  development  and 
deployment  of  new  energy  technologies.  This  means  that  even  though  the  sum  of  national 
public budgets of EU Member States exceeds those of the USA and Japan, such a comparison 
is  misleading.  The  USA  and  Japanese  market  size,  investment  and  research  capacities  far 
exceed those of most Member States alone.  

Public  R&D  budgets  from  Member  States  directed  to  nuclear-related  research  amount  to 
€0.59 billion for nuclear fission. If, for the purpose of this report with its focus on generation 
IV reactors, the parts dedicated to nuclear safety,  environmental protection, fissile  materials 
control  and  radiation  protection32  were  not  taken  into  consideration;  the  nuclear  fission 
'reactor technology related' R&D budget would be reduced to €0.25 billion. €0.28 billion are 
invested in R&D on nuclear fusion. 

The  overall  aggregated  Member  States'  public  spending  towards  SET-Plan  priority 
technologies  in  the  year  2007  amount  to  around  €1.1  billion  (around  half  of  which  goes  to 
each nuclear and non-nuclear low-carbon technologies) thus accounting for 43% of the total 
energy-related public R&D investments (i.e. not only those to low-carbon technologies). 

Table 6 summarises the aggregated Member States public R&D support by SET-Plan priority 
technology based on GBAORD and IEA data (with and without gap-filling for the IEA data, 
indicating  the  importance  of  and  risks  related  this  type  of  data  treatment).  For  information, 
figures  for  Japan  and  the  USA  are  also  provided,  based  on  the  data  from  the  IEA  RD&D 
database. 

As in some cases Member States provided data for a main category (e.g. bioenergy), but not 
for the subcategory selected for this report (e.g. transport biofuels), relevant main categories 
are  also  included  in  Table 6.  The  additional  information  is  useful  for  estimating  the 
uncertainty  created  by  using  data  on  the  high  level  of  detail.  For  example,  the  USA 
significantly invests in bioenergy research, but, no data is available on biofuel-related R&D in 
the  IEA  database.  Considering  the  ambitious  US  targets  on  biofuels  in  general  and  second 
generation  biofuels  in  particular  (ligno-cellulosic  ethanol),  one  may  assume  that  substantial 
parts of the bioenergy research budgets are dedicated to biofuels R&D. This, however, could 
not be captured with the available data33. 

31 

32 
33 

Note that the comparison of the total amount of all energy-related ERA-NETs calls launched under FP6 
with  the  annual  public  R&D  spending  of  Member  States  towards  non-nuclear  SET-P  priority 
technologies results in an overestimation of the percentage dedicated to joint calls, given that the calls 
usually relate to multi-annual projects and that they were launched during the period 2006-2008. 
These parts are summarised in the IEA category IV.1.4 'Nuclear Supporting Technology'. 
In  Figure 11  and  Figure 15  this  is  addressed  by  including  also  the  total  bioenergy  R&D  budgets. 
Furthermore,  in  Figure 11,  estimates  have  been  made  for  the  PV  and  CSP  R&D  budgets  despite  this 
data not having been available. 

EN 

39 

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GBAORD 2007 

IEA (EU19) 2007 

IEA 

Categories 
used  in  this 
report 

Terms by GBAORD 

R&D budget 

RD&D budget 

€ million 

with gap filling 
(2003-2006) 

Terms by IEA 

€ million 

€ million 

without 
gap 
filling 

with gap 
filling up 
to 2003 

USA 

Japan 

€ million 

€ million 

Renewable 
Energy 
Sources 

Renewable Energy 
Sources 

351 

Renewable 
Energy Sources 
(cat. III) 

469 

557 

304 

128 

Water, wind and wave 
energy 

15 

Wind (cat. III.2.) 

72 

81 

36 

Wind 

PV 

CSP 

Biofuels  

Bioenergy 

H2/FC 

Smart 
Grids 

CCS 

Fossil fuels 

Nuclear 
fission 

Nuclear 
fission: 
narrow 
down 
SET-P 
technology 

to 

Nuclear 
fusion 
Table 6: 

Solar thermal and 
photovoltaic energy 

125 

Research into biomass 
conversion... with a 
view to energy 

n.a. 

n.a. 

n.a. 

Fossil fuels and their 
derivatives 

Nuclear fission 

21 

n.a. 

n.a. 

n.a. 

33 

140 

Nuclear fusion 

139 

Photovoltaics 
(cat. III.1.2.) 

Solar Thermal 
Power and High 
Temp. Apps. (cat. 
III.1.3.) 
Production of 
Transp. Biofuels 
incl. from Waste 
(cat. III.4.1.) 

Total bioenergy 
(cat. III.4) 

H2 and fuel cells 
(cat. Group V.) 
Electricity 
transm. & distr. 
(cat. VI.2.) 
Total CO2 
Capture and 
Storage ( II.3.) 
Fossil Fuels (cat. 
II) 

Nuclear fission 
(cat. IV.1.) 

Nuclear fission 
(cat. IV.1.) - 
Nuclear 
Supporting 
Technology (cat. 
IV.1.4) 

Nuclear fusion 
(cat.IV.2.) 

123 

136 

101 

32 

33 

11 

65 

65 

n.a. 

2 

2 

0 

5 

183 

245 

143 

15 

164 

171 

183 

135 

33 

36 

219 

559 

47 

39 

240 

587 

35 

71 

34 

9 

268 

221 

231 

1528 

231 

248 

153 

652 

265 

278 

228 

94 

Aggregated  public  R&D  support  to  selected  energy  technologies  in  the  EU,  Japan  and 
USA in 2007 according to GBAORD and IEA 

Source:  JRC-IPTS  based  on  data  from  GBAORD  and  IEA  RD&D  statistics;  all  data  downloaded  in  January 
2009; data treated as described.  

Note: Data on the selected low-carbon technologies considered in this report are put in bold letters. 
Data  for  PV  and  CSP  in  the  U.S.  based  on  recent  literature  (Curtright,  2008;  US  DOE,  2008).  Data  are 
complemented by national statistics in the case of Germany, France, the UK, Austria and Belgium. For Ireland, 
official national data for the year 2006 have been used instead of the 2007 figures from the IEA database. 

EN 

40 

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4.1.3.  Energy-related R&D investments under FP6 

The  most  relevant  budget  line  in  FP6  for  energy-related  R&D  projects  was  'Sustainable 
Energy  Systems'  with  an  allocated  budget  of  €810  million  over  the  period  2002-2006 34.  In 
addition to the project funds, the European Commission's Joint Research Centre spent €72.6 
million on the priority 'Energy' over the FP6 period (JRC, 2008). It should be noted that the 
budget earmarked in FP7 for non-nuclear energy activities is €2350 million, yet over a longer 
time period (2007-13). On an annual average, this nevertheless means a substantial increase.  

The scope of  the  present analysis goes beyond the energy projects financed under the 'core' 
energy  budget  line  'sustainable  energy  systems'  as  described  in  section  3.4.  To  the  extent 
possible,  it  also  includes  relevant  projects  funded  under  budget  lines  such  as  'sustainable 
surface transport' or 'horizontal research activities involving SMEs', 'Aeronautics and Space' 
and  'Nanotechnologies  and  nanosciences'.  In  total,  project  funds  stemming  from  'non-core-
energy funds' add some €100 million to the R&D  on SET-P priority technologies, mainly in 
the areas of hydrogen and fuel cells, CSP and PV. 

The  total  support  to  non-nuclear  SET-Plan  priority  technologies  through  the  various  budget 
lines  of  FP6  has  been  estimated  to  have  been  in  the  order  of  €629  mi llion  over  the  period 
2002-2006, or €157 million on an annual average.  

Complementing  the  FP  budgets,  the  EURATOM  framework  program  allocated  €815.5 
million  to  fusion  activities.  The  total  EURATOM  contribution  for  nuclear  fission-related 
activities was €189.2 million. However, only a smaller pa rt of this is dedicated to research in 
new nuclear (GEN IV) reactor technologies, which are explicitly mentioned in the SET-Plan. 
Those  activities  are  mainly  financed  under  the  topic  'Innovative  Concepts'  (ca.  €17  million) 
within  the  budget  line  'Other  activities'.  The  JRC  spent  an  additional  €280.1  million  on 
nuclear energy, yet mainly not directed towards GEN IV reactors (JRC, 2008). 

A  broad  range  of  other  funding  schemes  exist,  parts  of  which  may  be  used  for  e.g. 
demonstration  projects  of  new  energy  technologies.  Without  being  comprehensive,  box  1 
briefly  describes  some  of  them,  largely  based  on  an  earlier  study  (DG  TREN  Task  Force, 
2008). 

34 

Decision 1513/2002/EC of the European Parliament and of the Council 

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41 

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Box 1 - Other EU financing funds 

Intelligent  Energy  Europe  has  been  an  EU  programme  for  the  promotion  of  energy 
efficiency and renewable energy sources. The IEE I programme lasted from 2003 to 2006. It 
had a total budget of €200 million over the period 2003-2006, of which €69.8 million were 
allocated  to  energy  efficiency,  €80  million  to   renewable  energy  sources,  €32.6  million  to 
energy aspects of transport, and €17.6 million on  the promotion of renewables and efficiency 
at international level.A further breakdown can be obtained when assessing the commitments 
under  IEE  I  instead  of  the  budget.  Within  ALTENER,  commitments  to  Renewables  for 
Electricity Generation amounted to €18.6 million, to  Renewables for Heating and Cooling to 
€16.6  million  and  for  Small  Renewables  to  €15.9  million;  commitments  to  biofuels 
accumulated  to  €10.5  million.  The  IEE  II  progra mme  started  in  2007  as  part  of  the  €3.6 
billion  Competitiveness  and  Innovation  Framework  Programme.  It  will  last  to  2013. 
Altogether,  around  €727  million  will   be  available  to  fund  projects  for  the  promotion  of 
energy  efficiency  and  renewable  energy.  This  implies  a  doubling  of  the  average  annual 
budget compared to the IEE I Programme. 

Within the Cohesion Policy, support to energy-related R&D activities takes place in various 
forms. Firstly, within the Cohesion Policy €49.9  billion are allocated for supporting Research 
and  Technological  Innovation  over  the  period  2007-2013,  parts  of  which  apply  to  the 
technologies  and  actors  considered  here.  In  addition,  these  funds  will  help  to  improve  the 
research  infrastructure  in  general,  supporting  e.g.  R&D  activities  in  research  centres, 
technology transfer and cooperation activities. Secondly, €9 bill ion are allocated to support 
renewables  and  energy  efficiency  over  the  same  period,  mainly  focusing  on  demonstration 
and  deployment.  In  the  context  of  the  Cohesion  Policy  initiatives  to  support  the  European 
Economic  Recovery  Package,  an  amendment  has  been  adopted  to  the  European  Regional 
Development  Fund  to  allow  energy  efficiency  and  renewables  interventions  in  residential 
buildings in all EU Member States. This opens the possibility for Member States to reallocate 
a further €8 billion to these types of investme nts. Finally, Cohesion Policy funds can also use 
innovative  financing  mechanisms  to  increase  the  leverage  of  public  investments  and 
encourage private sector participation. Examples of this are JESSICA and JASPERS that can 
both  support  energy  investments  with  Cohesion  Policy  funds  with  the  collaboration  of  the 
EIB among other international institutions. 

The  Trans-European  Networks  'Energy'  are  used  for  promoting  electricity  and  gas 
infrastructure  projects.  With  regard  to  low-carbon  energies,  they  may  play  a  role  for  e.g. 
financing  offshore  wind  connections  or  of  reserve  capacities  and  smart  grids  for  a  better 
integration of fluctuating renewable energy carriers.  

The last reform of the Common Agricultural Policy decided in November 2008, known as 
'Health  Check',  shifts  funds  from  direct  aid  to  farmers  into  Rural  Development  funding 
through  the  European  Agricultural  Fund  for  Rural  Development  (EAFRD).  The  additional 
funding  obtained  for  five  identified  "new  challenges",  including  climate  change  and 
renewable energy, totals 8.2 billion Euros for 2010-2013. 

4.2. 

R&D investments by SET-P priority technology 

In the following, the results of the assessment shall be presented at the basis of the individual 
low-carbon  technologies  that  are  the  focus  of  this  report.  The  assessment  of  the  public 
national  R&D  budgets  of  Member  States  largely  relies  on  the  IEA  RD&D  statistics,  thus 

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lacking  information  about  a  number  of  EU  Member  States  (see  section  1.1.1).  Due  to  the 
limited  data  availability  described  above,  it  was  also  not  always  possible  to  narrow  the 
industry's  research  investment  down  to  definite  figures  in  the  individual  technologies.  This 
means that when comparing e.g. the R&D investments by technology fields, it should be kept 
in mind  that  the  uncertainties might be  larger  than  the  differences between the investments. 
All in all, it is likely that the approach followed leads to an under-estimation of the corporate 
R&D investments, stemming from the fact that only a limited number of companies could be 
considered for each sector, and due to missing data that sometimes did not allow an educated 
estimation for some of the companies (see section 3.2.1). 

In  general,  data  for  PV,  wind  and  concentrating  solar  power  are  more  robust  than  those  for 
H2/FC, biofuels and CCS. This is due to the fact that in prior fields, a substantial number of 
companies are specialised in this technology only; therefore their total R&D investment could 
be assumed to be spent on those technologies, thus reducing the uncertainty (see section 4.3). 
The  figures  on  R&D  investment  for  Smart  Grids  should  be  considered  as  particularly 
uncertain as research in this area is often subsumed under headings on a more general level; 
besides, no comprehensive list of key actors could be generated for this sector.  

4.2.1.  Wind energy  

Europe is leading in wind energy, holding a 61% share of the globally installed wind energy 
capacity  in  2007  (EUROBSERV'ER,  2008a).  Given  the  high  global  investments  in  this 
technology  (around  US$50  billion  in  2007;  Boyle  et  al.,  2008),  it  is  not  surprising  that 
research investments in the EU reached €383 million in 2007. 

With wind energy in general being considered a rather mature technology, R&D investments 
are clearly dominated by industry, accounting for three quarters of the total. The comparably 
elevated maturity of wind energy would also be supported by wind energy showing the largest 
share of support to demonstration activities within the aggregated national R&D investments 
across  all  technologies  considered  (see  Figure 3  and  section  3.1  for  a  further  explanation  of 
the limitations of the underlying data). 

Both corporate and public investments mostly occurred in those EU Member States that have 
a  large  wind  energy  share  and  industry  (Germany,  Denmark  or  Spain).  The  large  public 
budgets  of  other  Member  States  may  be  explained  by  plans  that  aim  at  actively  increasing 
their wind energy share, such as the UK with ambitious offshore wind plans. However, even 
if the above Member States accounted for some 90% of the EU aggregated funds, also other 
Member States such as Italy, Sweden or France invested in wind energy related research. The 
EU funds that were dedicated to wind energy projects within FP6 remained limited. 

Compared  to  the  year  2006,  the  estimated  corporate  R&D  investments  in  wind  energy 
increased significantly (by an order of magnitude above 20%) to reach €292 million in 2007 
while  public  national  funds  showed  a  small  decrease  (-7%).  The  EU  funds  under  FP6 
amounted  to  around  €43  million  over  the  period  2002-6  (or  €11  million  on  an  annual 
average), a figure which is similar to the one estimated by Langlois d'Estainot (2009). 

The aggregated R&D investment of EU-based companies (€292 million in 2007) is the result 
of  an  assessment  of  13  companies.  Companies  being entirely  or  mostly active in this sector 
such  as  Vestas,  Gamesa,  Enercon,  Nordex  and  RE  Power  are  among  the  largest  investors. 
This figure of €292 million compares relativel y well to the results of other studies: 

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•  The Technology Platform Wind assumed corporate R&D investments of a set of 6 selected 
companies  to  be  in  the  order  of  €175  million  in  2006 35  (TP  Wind,  2008),  based  on  an 
approach  similar  to  the  one  used  here.  The  differences  to  the  present  report  can  be 
accounted for by the extended research scope of the present study, covering 13 companies. 

•  The SRS project estimated the corporate R&D investment allocated to wind energy to be in 
the order of €110 million for 2005. The discrepancy  to the assessment in the present report 
may be explained by the lack of data for countries with an important wind industry (such 
as  Germany  and  Spain).  Furthermore,  the  R&D  investments  of  the  wind  industry  have 
been growing substantially in recent years, explaining another part of the differences in the 
results of the SRS and the present report.  

•  The comparison of the corporate R&D investments with the turnover of the European wind 
energy sector further confirms the result of this work. Assuming its turnover to have been 
in the order of €11.3 billion 36 (Zervos et al., 2008), the results of the present report would 
thus indicate an R&D intensity of this sector of 2.6%-3.0%. This is considerably above the 
low  R&D  intensities  of  companies  active  in  the  electricity  sector  (0.6%)  and  oil  and  gas 
producers (0.3%) and in the order of magnitude of producers of electrical components and 
equipment (3.4%) and industrial machinery (2.6%) (Hernandez et al., 2008). Considering 
that  the  selection  of  companies  associated  with  research  on  wind  energy  made  in  the 
present  report  consists  of  companies  from  all  of  the  above  sectors  with  a  focus  on 
component  suppliers  and  specialised  wind  energy  turbine  producers,  this  comparison 
supports the finding of the present assessment37. 

Public EU (FP6, annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

3%

ca. €383 million

21%

76%

1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

1

2

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2

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Figure 12: 

Approximate R&D investment in wind energy from industry and public sectors 

HU AT IE PT CZ SE FR FI

IT NL ES DK DE UK

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

35 
36 

37 

Data are corrected from the original report as Nordex had been counted twice. 
The  turnover  of  the  European  wind  industry  was  estimated  to  have  been  around  €9  billion  in  2006 
(EWEA,  2007).  Extrapolating  this  into  2007  would  result  in  an  approximate  turnover  of  €10  billion 
(EUROBSERV'ER, 2008a), supporting the figure provided by Zervos et al., 2008.  
From this comparison one cannot derive whether the R&D intensity of the sector is sufficient or not. 
For deriving such a conclusion, it may be more appropriate to compare with R&D intensities of other 
rapidly developing sectors as done in chapter 5 despite some methodological problems that may arise 
when linking distinct sectors with different innovation systems. 

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€
 
 
                                                 
Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. Irish data refer to the year 2006. R&D investments for Belgium cannot be displayed at the current 
scale of the chart. 

4.2.2.  Photovoltaics 

The aggregated research investments in photovoltaic technologies are estimated to have been 
€384  million  in  2007.  The  data  indicate  that  pub lic  funds  account  for  a  substantial  share 
(42%),  and  even  so  may  not  yet  fully  reflect  all  PV-related  spending  in  large  national 
institutes which partially is not included in the data collected in the IEA RD&D statistics (see 
section 1.1.1). Compared to the year 2006 public national funds increased by almost 15%.  

Public EU (FP6, annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

7%

n
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ca. €384 million

35%

58%

€ 

35

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20

15

10

5

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1

1

2

1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

2

1

1

2

2

2

1

1

1

1

2

1

2

2

1

2

1

2

1

2

1

2

Figure 13: 

Approximate R&D investment in photovoltaics from industry and public sectors 

PT IE FI AT SE ES DK BE NL UK IT FR DE

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. No annual average estimated for Belgium due to a limited number of data; Irish data refer to the 
year 2006. 

The funds spent through the EC FP6 are in the order of 17% of the aggregated Member States 
national  public  funds  (see  Figure 13).  On  an  annual  average  over  the  duration  of  FP6,  they 
were  €27  million,  or  €108  million  over  the  entire  FP6  period.  This  result  of  the  present 
project-based assessment of EU funds is fully in line with figures provided by EPIA (2007) 
and Menna et al. (2007). 

Most  of  the  public  funds  originated  from  countries  with  a  comparably  high  deployment  of 
PV, such as Germany, France, Italy, and the Netherlands. Despite a limited deployment of PV 
in the UK, British public R&D investments are relatively high while the opposite is the case 
for  Spain.  Most  of  the  EU  corporate  R&D  investments  in  PV  stem  from  companies  with 
headquarters in Germany, France, Spain and the UK. 

The Spanish data presents a contrast in that on the one hand, the country has an excellent solar 
resource, and combines a favourable deployment scheme with high growth rates in installed 
PV  capacities38,  while  on  the  other  the  public  and  corporate  research  budgets  are  relatively 

38 

In 2007, it ranked second among EU Member States in terms of installed PV capacity. 

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low. This may partly be explained by the use of imported technology. Also PV has become a 
priority in the Spanish national energy strategy only recently, and would thus impact on future 
R&D budgets but would not yet be reflected in R&D budgets that are the results of decisions 
taken some years before.  

Only 4 (Q-cells, Solarworld, BP Solar, Isofoton) of the top 15 manufacturers of PV modules 
are  located  in  the  EU  and  the  EU  correspondingly  produced  28.5%  of  global  PV  cells 
(EUROBSERVER, 2008b). At the same time, given the high growth rates of the global PV 
market  in  recent  years  and  its  potentials  for  further  expansion,  the  sector  has  become 
attractive for a number of non-specialised multi-business companies (such as Siemens, Shell, 
BASF, Schott and Total) and saw a corporate R&D investment of €221 million in 2007 in the 
EU, well above comparable figures for the year 2006 (an increase of more than 20%). This is 
the  result  of  the  assessment  of  30  key  companies  in  this  sector,  for  which  data  could  be 
obtained.  Unfortunately,  for  some  important  companies,  no  data  could  be  acquired39. 
However,  a  comparison  with  other  studies  endorses  the  findings  obtained  with  the  present 
approach: 

•  In  particular,  according  to  an  estimate  published  by  the  German  Association  of  solar 
industry  (Bundesverband  Solarwirtschaft  BSW)  the  German  PV  industry  invested  €176 
million in R&D in 2007, out of which €150 million came from the dedicated PV industry 
and business units and another €26 milli on from suppliers (Ruhl et al., 200840). This R&D 
investment  from  'industry'  (€150  million)  can  be  compared  to  the  R&D  investment  of 
companies  considered  in  the  present  report  with  headquarters  in  Germany,  which 
amounted  to  €118  million  in  2007.  This  reveals  reasonable  accordance  between  the  two 
studies,  in  particular  when  one  considers  that  the  German  approach  assesses  the  R&D 
investment  of  both  German  and  foreign  enterprises  in  Germany  (this  latter  part  is  not 
covered  by  the  approach  applied  in  the  present  report)  and  that  the  company  assessment 
approach used here was not fully complete as noted above. 

•  Compared to  the  turnover  of  the  EU  PV sector,  which was around  €9-10  billion in 2007 
(EPIA personal communication; EUROBSERV'ER, 2008b), the estimated R&D intensity 
is 2.2-2.5%. Given that the assessment includes a mix of companies with one part coming 
from  less  R&D  intensive  sectors  with  R&D  intensities  below  1%  (e.g.  construction  and 
materials,  oil  and  gas  producers  and  electric  utilities)  and  the  from  sectors  with  R&D 
intensities  of  the  order  of  2%  to  4%  (chemicals,  electrical  components  and  alternative 
energy), the R&D intensity found for PV would support the finding of the analysis. 

4.2.3.  Concentrating solar power 

CSP-related research spending (approx. €86 mill ion) was relatively limited in 2007 compared 
with  other  SET-Plan  priority  technologies,  reflecting  the  fact  that  interest  in  this  field  has 
started  growing  again  only  relatively  recently.  The  potential  locations  of  CSP  plants  are 
focused in the countries around the Mediterranean and as such, it is not surprising that public 
R&D support is dominated by Italy and Spain, accounting for more than three quarters of the 
aggregated EU Member States funds (see Figure 14). 

39 
40 

For another 7 companies that were identified as important players, no figures could be obtained. 
The study was also used for verifying that all major companies were included in the present work.  

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The German contribution to CSP-research amounts to another 18% of the EU Member States' 
public  aggregated  investment,  which  may  be  explained  by  the  strong  position  of  German 
industry in this technological field. This means that three Member States i.e. Italy, Spain and 
Germany account for around 95% of the total public R&D investment in this technology. It is 
noted, however, that these figures may not fully reflect CSP-related R&D spending in French 
national R&D centres. 

The EU support to CSP-related R&D activities through FP6 funds as assessed in the present 
report reached €20 million over the FP6 duration  (or €5 million on an annual average). This 
figure  is  slightly  below  the  investments  of  €25  million  published  in  European  Commission 
(2007d), which can partly be explained by the fact that some CSP-related projects have been 
allocated to other SET-Plan priority technologies in order to avoid double counting.  

Corporate R&D investments (around €50 million)  accounted for 56% of the overall spending, 
led  by  companies  based  in  Spain  and  Germany,  followed  by  Italian  and  French  companies. 
Spanish  and  German  companies  are  the  main  actors  involved  in  the  ongoing  demonstration 
projects launched in Spain, supported by the national feed-in programme. The estimation of 
the corporate R&D investment relies on the assessment of 18 larger companies for which data 
could be obtained. The assumptions for these companies have been checked with and revised 
in  line  with  an  in-depth  assessment  of  this  sector  (Haug  et  al.,  2009),  which  also  provided 
aggregated information on a number of smaller companies that were as well included in the 
present assessment. As a consequence, the estimation of corporate R&D investments of this 
report  is  rather  well  in  line  with  the  findings  of  €52.5  million  in  Haug  et  al.  (2009).  Note, 
however, that this should be considered as a low estimate. The uncertainties related with the 
estimation of R&D investments for the year 2006 do not allow for an indication of the trend 
in corporate R&D investments in this sector.  

Public EU (FP6, annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

6%

38%

ca. €86 million

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2- Annual average over the period 2002-2007

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56%

Figure 14: 

ES
Approximate R&D investment in CSP from industry and public sectors 

DK

UK

DE

FI

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. R&D investments for Austria cannot be displayed at the current scale of the chart. 

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€
 
 
4.2.4.  Biofuels 

Transport biofuels have become a priority in the EU policy over the past years with a rapidly 
growing market. This is reflected by an important research budget of €347 million in 2007. 
Note  that  this  figure  is  not  restricted  to  research  into  2nd  generation  biofuel  production 
pathways  that  are  a  priority  within  the  SET-Plan,  but  comprises  all  transport  biofuel 
technologies. Unlike for many other technologies, the Member States with the largest public 
R&D budgets in many cases do not coincide with the countries that host the headquarters of 
biofuel-research intensive companies.  

The  public  share  of  R&D  investments  remains  low  with  only  23%  of  the  total  budget  (see 
Figure 15). EU funds through FP6 amounted to around €13.5 million on an annual average, 
which  compares  well  to  the  assessment  in  Kutas  et  al.  (2007).  The  limited  share  of  public 
R&D investments may not only be due to the relatively elevated maturity of biofuels, but may 
also be explained by data restrictions: 

•  Public research budgets for first generation biofuels would naturally be limited considering 
the maturity of these technologies. However, due to the potential negative impact of these 
starch- or oil-based fuels on food prices and the environment, advanced biofuel processes 
are increasingly being considered as the more promising future pathways. As research into 
those '2nd generation biofuels' has only recently become a (public) priority, it is reasonable 
to assume that it is not yet fully reflected in the national R&D budgets that are based on 
budget decisions taken some years ago.  

•  Furthermore, the data suggest that some Member States may not explicitly disclose R&D 
on biofuels, but rather  allocate it  under the category  bioenergy-related research. In  2007, 
the total R&D investment in bioenergy for the EU Member States reaches €245 million of 
which  only  €65  million  is  allocated  to  trans port  biofuels.  For  this  reason,  the  overall 
bioenergy-related public national research budgets are also shown in Figure 15. 

Corporate  R&D  investments  into  biofuels  are  €269  million,  based  on  an  assessment  of  the 
R&D  expenditures  of  23  companies.  Compared  to  the  roughly  estimated  2006  figures,  this 
would  mean  an  increase  of  some  10%  to  20%  (note  the  uncertainties  related  to  such  a 
comparison  as  explained  in  box  3).  The  companies  included  in  the  analysis  consist  of 
specialised biofuel companies, large car manufacturers and oil companies, with the latter two 
accounting for the larger part of corporate R&D investments. Unfortunately, no figures could 
be obtained for a number of important biodiesel and -ethanol producers.  

Within  the  limits  of  data  accuracy  a  regional  breakdown  indicates  that  corporate  R&D 
investments do not necessarily originate from companies with headquarters in countries that 
show a high public R&D budget. Indeed, all countries with high public biofuel-related R&D 
budget  are  home  to  companies  with  substantial  research  investment  for  biofuels  (i.e. 
Germany,  France,  Denmark,  Sweden,  Spain  and  Austria).  But  at  the  same  time,  the 
assessment finds that substantial contributions also come from British and Finnish companies, 
even their public budgets do not explicitly allocate funds to biofuels R&D. A slightly better 
match would thus be obtained between the location of corporate and public funds, if the total 
public  bioenergy-related  budgets  were  considered  instead  of  transport  biofuels  only,  which 
may  be  a  sensible  proxy  for  some  countries  that  do  not  explicitly  reveal  figures  on  biofuel 
R&D (see bullet point 2 above). 

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If  we  assume  the  turnover  of  the  EU  biofuel  industry  to  have  been  in  the  order  of  €6-7.5 
billion  in  200741,  the  results  of  the  present  report  (€269  million)  would  imply  an  R&D 
intensity of 3.6-4.5%. This R&D intensity may seem elevated at first glance if compared to 
the  results  for  the  wind  energy  and  PV  sectors.  However,  it  seems  more  plausible  when 
considering  that  manufacturers  of  automobiles/parts,  which  are  among  those  companies 
interested  in  biofuel  research,  have  a  relatively  higher  R&D  intensity  (4.6%)  than  most 
energy-related sectors.  

The comparison with the SRS project results indicates that the present analysis may be overly 
optimistic. According to that project, corporate R&D expenditures in bioenergy amounted to 
less  than  €50  million  in  2005.  However,  it  is  important  to  note  that  biofuel  research  has 
gained  in  momentum  over  the  last  years,  which  may  account  for  parts  of  the  difference. 
Furthermore, the approach used in the present assessment allocates R&D expenditure to the 
site of the headquarters. As such, all research done by large EU-based oil companies active in 
biofuels research (e.g. Shell, BP, Total) or car manufacturers (e.g. Volkswagen) is allocated to 
the EU. 

Public EU (FP6, annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

4%

ca. €347 million

19%

77%

€ 

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1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

1

Total bioenergy minus biofuels

Prod. of Transport Biofuels incl.
from Wastes

MS with reported R&D 
investments in transport biofuels

1

2

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2

IE FI NL UK AT BE HU DE IT ES DK SE FR

60

50

40

30

20

10

0

Figure 15: 

Approximate  R&D  investment  in  transport  biofuels  from  industry  and  public  sectors 
(R&D investment in bioenergy is also included as supplementary information) 

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. R&D investments of Portugal and Slovakia cannot be displayed at the current scale of the chart. 
No annual average estimated for Belgium due to a limited number of data; Irish data refer to the year 2006. 

41 

Note  that  no  official  figure  could  be  obtained  for  the  turnover  of  the  EU  biofuel  industry.  For  this 
reason,  it  had  to  be  approximated  by  two  distinct  approaches.  Firstly,  multiplying  the  EU  biofuel 
production figures with the typical market prices for bioethanol, biodiesel and pure vegetable oil would 
result in a turnover of some €6 billion, yet disregardi ng benefits from the sale of co-products. Secondly, 
the turnover of the German biofuel industry (BMU, 2008) has been extrapolated to the total EU on the 
basis  of  Germany's  contribution  to  overall  EU  biofuel  production  (data  based  on  EUROBSERV'ER, 
2008c). This would result in a turnover of almost €7.5 billion.  

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4.2.5.  Carbon dioxide capture and storage (CCS) 

Research investments into CCS amounted to €296 million in 2007. Both public and corporate 
R&D  investments  largely  stemmed  from  relatively  few  Member  States  and  companies  with 
headquarters in these countries, namely Germany, France, and the UK (as well as Sweden and 
Denmark with regard to corporate investments). Together with biofuels, CCS-related research 
showed  the  by  far  lowest  amount  of  public  funding  with  a  share  of  19%  (see  Figure 16). 
Somehow similar to the case of biofuels, this low amount and share of public funding might 
be explained by three factors: 

•  Firstly, CCS has only recently become a priority for many Member States, reflecting the 
increasingly stringent targets on climate change. This may not (yet) be reflected in the past 
decisions that underlie the public R&D budgets for the year 2007, which might imply an 
underestimation of current public R&D efforts in that area. 

•  Secondly, with CCS being a relatively new technology, many Member States may not yet 
have accounted for CCS in an explicit category, but ranked it within the category of 'fossil 
fuels', which has an important EU Member States budget of €240 million. This would also 
explain why data on CCS are available for only eight Member States. 

•  Thirdly,  even  though  CCS  is  still  in  its  developing  phase,  most  of  the  single  processes 
underlying it are rather well proven and the main challenges are its large-scale application 
and cost reduction. The latter may not be considered as R&D but rather demonstration or 
even  early  deployment,  and  would  thus  not  necessarily  be  included  in  public  research 
efforts.  

EU funding through FP6 dedicated to CCS-research has been in the order of €70 million (or 
€17 million as annual average). This result is fully supported by an assessment made by the 
European Commission (2007e), which estimated the FP6 support to CCS-projects to be €70 
million. 

Public EU (FP6, annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

6%

n
o

i
l
l
i

m

ca. €296 million

13%

81%

30

25

20

15

10

5

0

1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

1

2

2

2

1

1

2

1

1

2

1

2

DK

ES

IT

NL

UK

FR

Figure 16: 

Approximate  R&D  investment  in  CO2  capture  and  storage  from  industry  and  public 
sectors 

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

EN 

50 

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€
 
 
Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. R&D investments for Portugal, Belgium and Austria cannot be displayed at the current scale of 
the chart. 

The  elevated  corporate  R&D  investments  in  this  sector  (around  €240  million  in  2007)  are 
based on the fact that most large utilities, oil companies and some component suppliers have 
an interest in this technology. This is underlined by the activities within the 'Greenhouse Gas' 
Implementing Agreement, one of the transnational R&D programme cooperation activities of 
the  IEA,  which  is  dominated  and  mainly  financed  by  industry.  Out  of  the  23  companies 
assessed  in  this  sector,  seven  are  electric  utilities,  three  are  oil  companies,  three  are  large 
component  suppliers  and  another  three  are  major  chemical  companies.  Given  the 
methodology applied, the intrinsic uncertainties of determining the R&D share dedicated to a 
certain technology are elevated for these companies as they are also active in many different 
areas (see section 4.3). 

Nevertheless, corporate CCS-related R&D investments are of the same order of magnitude as 
information provided by the Technology Platform for Zero Emission Fossil Fuel Power Plants 
in a letter to Commissioner Piebalgs from February 2008 (ZEP, 2008b), according to which 
the "corporate commitments" of the companies signed "to the early development of CCS, as 
well as the achievement of CCS-related efficiency-increase, already amount to a total of more 
than  €635  million  over  the  past  five  years  in  a ggregate".  This  figure  would  more  or  less 
confirm the estimation of the present report when considering that the research efforts in later 
years  have  probably  been  more  intense  than  those  in  earlier  years  given  the  increasing 
importance of CCS, and considering further that the present assessment is based on a group of 
EU-based companies that is (slightly) larger than the signees to the letter. 

4.2.6.  Hydrogen and fuel cells 

Hydrogen and fuel-cells seem to attract the largest R&D investments among the non-nuclear 
energy  technologies  considered  in  this  report:  around  €616  million  are  dedicated  to  this 
technology. This elevated investment may be explained by the fact that, unlike for most other 
technologies  assessed,  the  category  'hydrogen  and  fuel  cells'  comprises  an  entire  fuel  chain 
from production to consumption with a broad range of transportation, stationary and portable 
applications, thus attracting a large number of different private and public actors. As such, a 
multitude of different single technologies are subsumed under the heading 'hydrogen and fuel 
cells', all of which are at different levels of maturity.  

Public R&D investments of EU Member States in 2007 and (annualised) EU funds under FP6 
amounted to around €241 million, with the EU  funding under FP6 having accounted for more 
than one quarter of this. This would mean that the EU FP6 funds for H2/FC research projects 
reached  around  €70  million  on  an  annual  aver age  (€280  million  over  the  duration  of  FP6). 
This  figures  remains  below  the  estimates  of  other  sources  that  are  in  the  order  of  €300-320 
million  (European  Commission,  2007b;  Filiou  et  al.,  2009;  Orion  Innovations,  2008).  This 
discrepancy  can  be  explained  by  the  allocation  process  undertaken  in  the  present  work  (see 
section 3.4). If all projects that were somehow related to H2/FC research had been allocated to 
H2/FC (even though their focus has been on other research areas such as CCS), the total EU 
R&D  investment  in  H2/FC  would  have  reached  €318  million  in  the  present  analysis. 
However, for consistency reasons, such double counting has been avoided, which may have 
caused some (limited) distortions for individual sectors (see also section 4.3.2).  

Compared to the year 2006, public national R&D budgets of the EU Member States included 
in the analysis increased by 17%. Member States with important R&D spending on hydrogen 

EN 

51 

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and fuel cells include France, Germany, Italy and Denmark, followed by the UK with some 
distance  (see  Figure 17).  The  same  countries  also  host  the  companies  with  the  largest 
corporate R&D investments, led by German, British and French companies. 

The  public  R&D  investments  found  in  the  present  report  remain  below  those  of  a  recent 
publication  based  on  data  from  the  HY-CO  project,  according  to  which  the  aggregated  EU 
and  Member  States  budgets  amounted  to  €275  million  in  2005  with  further  increases  to  be 
expected  (Neef,  2008).  Parts  of  the  discrepancies  may  be  explained  by  missing  data  on 
regional  R&D  funds  that  are  excluded  for  some  countries.  In  Germany,  for  example, 
hydrogen and fuel-cell related research investments financed by the Länder amounted to €18 
million in 2006 (Schneider, 2007). It is also possible that the important regional investments 
into H2/FC-related research in Italy are not included in the IEA database.  

The  high  corporate  R&D  investments  (€375  million)  might  be  explained  by  the  number  of 
companies interested in this research area as well as the fact that hydrogen and fuel cells are 
considered  as  a  strategic  research  field  for  many  of  the  large  multinational  companies  with 
high overall research expenditures. The present assessment looked into 68 companies active 
in this area, among them eight car manufacturers; six oil companies or utilities and four large 
component  suppliers.  The  remainder  predominantly  comprises  various  small  companies 
specialised  in  fuel  cells,  but  also  includes  some  large  chemical  or  gas  companies  that  are 
mainly involved in hydrogen-related research.  

In particular for multinational companies it is important to note that the approach used in this 
report allocates the R&D to the location of headquarters and not to the country in which the 
research  is  effectively  being  carried  out.  This  may  explain  part  of  the  differences  of  the 
present results with other studies:  

•  The '2007 Worldwide Fuel Cell Industry Survey42' (PWC et al., 2007) collected data on the 
global fuel cell industry through a web-based survey. It finds that global R&D investment 
in  fuel  cells  amounted  to  US$829  million  in  2006.  However,  only  some  US$107  million 
(ca.  €80  million 43)  occurred  in  EU  Member  States.  Compared  with  the  findings  of  the 
present  work,  this  estimate  on  EU  investment  in  the  Fuel  Cell  Survey  seems  rather  low. 
This may primarily be due to the differences in the allocation of companies to geographic 
regions, which is of particular importance for this sector as it involves many multinational 
companies. Unlike the present report, the Fuel Cell Report allocates R&D investments to 
the  country  in  which  the  R&D  is  being  carried  out.  In  addition,  the  response  rate  of  EU 
based  companies  in  the  study  was  limited  (out  of  the  182  responses,  only  37  where 
received from EU companies). Finally, the Fuel Cell Report concentrates on fuel cells and 
therefore leaves out the hydrogen production part.  

•  The SRS project concludes that some €30 m illion were spent on hydrogen-related research 
in 2005. According to ERMINE, even less (€14 m illion) was spent on that line of research, 
yet  restricted  to  the  electricity  sector.  These  differences  cannot  be  explained  in  simple 
terms  but  may  partially  stem  from  lack  of  data  in  those  projects.  Furthermore,  car 

42 
43 

http://www.usfcc.com/resources/2007worldwide_survey_final_low.pdf 
If  this  amount  was  amended  by  data  for  the  Netherlands  and  France  (based  on  figures  from  ECN 
(Energy  Research  Centre  of  the  Netherlands)  and  l'Association  Française  de  l'Hydrogène),  which  are 
not explicitly included, the EU total would rise to some €150 million.  Such an approach would however 
lead to major methodological problems. 

EN 

52 

   EN 

 
                                                 
manufacturers, which are among the prime investors in fuel cells according to our analysis, 
are not considered by the ERMINE study. 

•  In 2004, the IEA roughly estimated the private sector's R&D investment in hydrogen and 
fuel cells to be in the order of US$3-4 billion (IEA, 2004). Despite the lack of a regional 
breakdown  and  important  developments  in  the  sector  since  then,  this  estimation  would 
support the order of magnitude of the present assessment. 

Given the particular uncertainties for deriving the corporate R&D investments in the present 
report  and  considering  the  wide  span  of  results  found  in  literature,  the  results  on  industrial 
R&D  investments  in  H2/FC  must  be  regarded  with  care.  A  further  comparison  would  be 
needed with a special focus on the differences in the geographical allocation and definition of 
the sectoral boundaries.  

Public EU (FP6, annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

11%

ca. €616 million

28%

61%

n
o

i
l
l
i

m

€ 

60

50

40

30

20

10

0

1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

1

2

1

2

1

1

2

1

2

1

2

2

2

1 2

1

2

1

1

BE

AT

SE

ES NL UK DK

IT

DE

FR

Figure 17: 

Approximate  R&D  investment  in  hydrogen  and  fuel  cells  from  industry  and  public 
sectors 

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are  available.  Portuguese  R&D  investments  cannot  be  displayed  at  the  current  scale  of  the  chart.  No  annual 
average estimated for Belgium due to a limited number of data. 

4.2.7. 

Smart grids 

The investments in R&D related to smart grids seem to be in the order of €273 million with 
private funds accounting for more than 75% of the total (€212 million). Note that this figure is 
highly uncertain both with regard to data from industry and to public data44, and most likely 
comprises grid-related research that goes beyond a narrow definition of 'smart' grids. 

Due to the somehow 'fuzzy' boundaries of the 'smart grids' category, it was often not possible 
to  make  a  substantiated  assumption  for  the  share  of  R&D  investments  dedicated  to  that 
technology.  For  this  reason,  the  assumptions  were  made  for  all  grid-connected  research 
investment.  Similarly,  the  IEA  R&D  statistics  used  for  assessing  the  national  public  R&D 

44 

According to IEA database, public national support to smart grids decreased by almost 50% between 
2006 and 2007. This is largely caused by a fall in Italian funds, which had shown very elevated R&D 
investments on smart grids for the year 2006 compared to data from both the years before and 2007. 

EN 

53 

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spendings  do  not  contain  a  dedicated  category  for  smart  grids;  instead  category  IV.2 
'Electricity Transmission and Distribution' was used.  

Also  the  EU  funds  through  FP6  that  have  been  estimated  to  have  been  €14  million  on  an 
annual  average  over  the  effective  duration  of  FP6  remain  below  the  estimates  made  in 
European  Commission  (2007c).  Parts  of  the  differences  stem  from  the  allocation  process 
applied  in  the  present  work.  Other  parts  may  be  explained  by  the  fact  that  not  all  R&D 
included  in  European  Commission  (2007c)  would  necessarily  be  associated  with  the  group 
'smart grids'. 

Finally, smart grid related research may attract companies that go beyond the search pattern 
applied  in  this  report.  Besides  the  component  suppliers,  electric  utilities  and  other  energy 
companies  assessed,  companies  active  in  sectors  such  as  information  technologies  may  be 
active in this area, such as IBM which has initiated the Intelligent Utility Network. Corporate 
R&D investments in smart grids largely stem from French-based companies (e.g. Areva, EdF 
Group) and German companies (e.g. Siemens). 

Public EU (FP6, annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

5%

17%

ca. €273 million

78%

n
o

i
l
l
i

m

45

40

35

30

25

20

15

10

5

0

1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

2

1

1

2

1

2

2

2

1

1 2

1

2

1

2

1

2

1

2

1

2

1

DE UK SK DK IE AT FR SE BE NL FI

IT

Figure 18: 

Approximate R&D investment in smart grids from industry and public sectors 

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. Note that the IEA category IV.2 'Electricity Transmission and Distribution' comprises more than 
smart grids only. No annual average estimated for Belgium due to a limited number of data. 

4.2.8.  Nuclear fission  

Within  the  context  of  the  SET-Plan,  research  into  'generation  IV'  reactors  is  of  particular 
interest. Unfortunately, it has not been possible to narrow down either the public or the private 
nuclear  fission  related  R&D  investments  exclusively  to  research  on  generation  IV 
technologies,  meaning  that  the  figures  provided  in  the  following  are  likely  to  be  an 
overestimation45.  In  order  to  limit  the  overestimation,  the  main  analysis  refers  to  research 

45 

The concept of Generation IV is linked to particular objectives such as greatly increased sustainability 
and  minimised  long-lived  waste  production,  increased  resistance  to  weapons  proliferation,  a  level  of 
safety  at  least  equivalent  to  the  best  achievable  in  current  technology  with  emphasis  on  passive  and 

EN 

54 

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€
 
 
                                                 
investments in the area of nuclear reactor technology and the fuel cycle (to the extent that this 
was  possible  for  the  private  sector).  To  simplify,  this  group  will  be  referred  to  as  'nuclear 
reactor R&D' in the following. Nonetheless, it was decided to also present figures on 'total 
nuclear  fission  related  R&D',  which  besides  reactor  technology  R&D  also  contains  topics 
such as nuclear safety, environmental protection, waste management, fissile materials control 
(i.e. security issues), and a variety of other topics – some of which may have no direct relation 
to  energy  production.  Figure 20  thus  provides  information  on  these  total  nuclear  fission 
related R&D budgets as well.  

Note,  that  these  cannot  be  directly  compared  with  the  investments  in  any  other  technology 
assessed  within  the  present  report,  since  the  R&D  is  for  the  sector  as  a  whole  whereas  all 
other technologies focus on innovative "low carbon" aspects only (e.g. CCS research does not 
include  any  activities  on  coal  mining,  fossil  fuel  combustion  technology,  etc.).  Even  a 
comparison between the R&D investments of other technologies with those in 'nuclear reactor 
R&D' thus remains difficult without a clear idea of the generation-IV component. Besides, it 
should be remembered that generation IV is a refinement of a technology already responsible 
for  large-scale  low-carbon  energy  production.  The  nuclear  industry  is  a  well-established, 
profitable and high-tech industrial sector that, as part of normal investments in improvements 
and everyday developments in current technology, already devotes considerable resources to 
R&D on the nuclear fuel cycle in general and nuclear reactor technology in particular. 

The difference between total nuclear fission R&D and reactor-related R&D is illustrated for 
the  national  public  budgets  in  Figure 19  –  the  difference  between  the  two  categories  is 
accounted  for  by  'nuclear  supporting  technologies',  which  is  excluded  when  focusing  on 
'nuclear reactor R&D'. There is some doubt, however, over the exact definition of the R&D 
undertaken and even the public or industrial attribution of parts of this spending. In particular, 
though some revenue is attributed within the public domain, it may originate from the sale of 
nuclear electricity or nuclear reactors / services. For example, it is known that the funding of 
R&D  on  waste  management  (in  particular  geological  disposal)  is  supported  essentially 
through  the  "polluter  pays  principle"  (i.e.  revenue  from  sale  of  nuclear  electricity)  even 
though  funds  are  often  managed  in  the  public  domain.  More  detailed  analysis  than  was 
possible within the present survey will be needed in order to quantify such effects.  

intrinsic design features, and other uses of nuclear energy such as process heat for industrial processes, 
e.g. hydrogen production. It is these aspects that are of particular interest in the context of the SET-Plan. 
Most of this effort is currently at the stage of pre-competitive research. 

EN 

55 

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n
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m

7
0
0
2

300

200

100

0

"Nuclear reactor R&D"

FR

BE

IT

DE

NL

FI

SE

CZ

Others

Fuel Cycle

Nuclear
Supporting
Tech.

Other
Converter
Reactors

Light-Water
Reactors

Other
Nuclear
Fission

Nuclear
Breeder

Figure 19: 

Aggregated  public  support  of  EU  Members  to  R&D  in  selected  nuclear  energy 
technologies in 2007 

Source: IEA RD&D statistics 

Note:  Gap  filling  applied  with  data  from  back  to  2003  as  follows:  2006  data  were  used  for  Finland  and  the 
Netherlands while for the Czech Republic 2003 data were used. Note that only the total fission R&D is given for 
the UK in 2007 (€4.3 million); no nuclear R&D breakdow n is available except for nuclear breeder in 2003 for 
the UK. 

R&D investment in nuclear reactor R&D amounted to around €458 million in 2007, almost 
equally  financed  by  the  private  (€205  million)   and  the  public  sector  (€253  million).  Both 
private  and  public  funds  largely  concentrate  within  France.  In  2007,  France  accounted  for 
more  than  half  of  the  total  public  budgets  of  EU  Member  States  in  nuclear-reactor  related 
research. This result is to be viewed in the light of France's large share of nuclear generating 
capacity  in  Europe.  i.e.  ca.  50%.  Other  Member  States  directing  important  budgets  towards 
nuclear-reactor related research were Italy, Germany and the Netherlands (though very little 
was related to generation IV). 

Total investments in all nuclear fission related R&D (€1.25 billion) would be almost three 
times the part  that  is  dedicated to  research on  nuclear reactor technologies.  Corporate R&D 
investments account for 44% of this budget. 76% of the Member States funding stems from 
France, which spends half of its total energy R&D budget on nuclear fission (again, must be 
viewed in the light of the 79% of domestic electricity consumption being of nuclear origin in 
France). 

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€
 
 
Public EU (EURATOM budget; annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

1%

Nuclear reactor 
technology

45%

ca. €458 million

54%

Total nuclear 
fission

9%

44%

ca. €1250 million

500

450

400

350

300

250

200

150

100

50

n
o

i
l
l
i

m

Other nuclear fission (i.e. nuclear
supporting technology)

2

1

Nuclear fission (mainly reactor
research and fuel cycle, thus without
safety, waste, environment) 

1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

1

2

2

1

1

2

1

2

1

2

1

0

1

2

1

1

2

47%

CZ

FI

ES SE UK NL BE DE

IT

FR

Figure 20: 

Approximate R&D investment in nuclear fission from industry and public sectors 

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. Date for Slovakia, Denmark and Hungary cannot be displayed at the scale of the present chart. 
Note that it was not possible to narrow the analysis on 'generation IV' reactors. For this reason, a sub-group 
'nuclear  reactor  technology'  has  been  artificially  created,  which  mainly  ignores  R&D  dedicated  to 
environmental safety, radiation protection etc., but is still much broader than pure 'generation IV'. No annual 
averages estimated for Belgium and Czech Republic due to a limited number of data. Regarding EU funds for 
'total  nuclear  fission',  not  only  project-related  funds  under  EURATOM  have  been  included  but  also  the  JRC 
funds dedicated to nuclear energy. 

The assessment of corporate R&D investments in nuclear energy is based on nine companies 
only,  reflecting  the  limited  number  of  major  players  in  this  sector.  Similar  to  the  public 
funding, French companies (AREVA, EdF, GDF-Suez to a lesser extent) largely dominate the 
total corporate R&D investments in nuclear fission. Unfortunately, for most companies it was 
not possible to determine the part of nuclear R&D that is dedicated to reactor technologies. 

Nevertheless,  a  rough  estimate  indicates  that  corporate  R&D  investment  in  nuclear  reactor 
technology  may  be  in  the  order  of  €200  million,  while  corporate  research  into  all  nuclear 
fission related aspects would amount to around €550 million. However, only a fraction of this 
will be on generation IV technology, reflecting unwillingness by industry to invest heavily in 
a  technology  that  is  30  years  from  possible  commercial  deployment  and  in  a  sector  where 
there  is  considerable  political  and  regulatory  uncertainty.  Consequently,  most  industrial 
players see this currently as the principal responsibility of the public sector. 

This compares to the results of the ERMINE project, which estimated the private investment 
into  nuclear  fission-related  R&D  to  be  in  the  order  of  €304  million  in  2004.  Given  that 
AREVA, by far largest spender in this area, saw an annual increase in its R&D expenditure of 
more than 20% over the past three years, the ERMINE result are relatively well in line with 
the present assessment.  

Box 2 – Euratom FP budget (indirect actions) on Gen IV reactors 

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€
 
 
In  Euratom  FP6  some  €17  million  were  dedicate d  to  'innovative  concepts'  out  of  a  total  of 
€189  million  for  all  fission-related  research  (i.e .  less  than  10%).  This  is  support  to  pre-
competitive research on the potential of Gen IV technology. The overall Euratom FP7 budget 
for 'indirect actions' in nuclear fission has not increased above inflation relative to FP6, and 
the  programme  retains  its  broad-based  nature  dealing  with  a  number  of  priority  areas  in 
nuclear  science  and  technology,  some  of  which  have  little  if  anything  to  do  with  nuclear 
energy  per  se.  Nonetheless,  it  is  likely  that  Gen  IV-related  research  will  constitute  a  larger 
percentage of the total during FP7 than during FP6.  

4.2.9.  Nuclear fusion  

Nuclear fusion is publicly financed with the EU-funds contributing around 42% of the total 
(up to FP6 2006) and the Member States contributing the remaining 58% in 2007, amounting 
to  a  total  of  around  €482  million  (see  Figure 21).  Germany  is  the  by  far  largest  singly 
spending country, followed by Italy, France and the UK. 

Nuclear  fusion  energy  research  constitutes  an  exception  among  the  SET-Plan  priority 
technologies.  There  is  hardly  any  corporate  R&D  investment  and  most  public  R&D 
investments are implemented in one single European Programme coordinated by EURATOM. 
After  the  decision  to  build  ITER  was  taken  in  2006,  the  implementation  of  the  largest 
programmes  (ITER  and  Broader  Approach)  is  carried  out  through  the  "European  Joint 
Undertaking  for  ITER  and  the  Development  of  Fusion  Energy",  which  was  established  in 
April 2007. 

Taking  into  account  that  the  bulk  of  the  budget  for  ITER  construction  will  be  provided 
through the EU budget, it may be expected that the EU share of the overall expenditure in the 
next years will clearly exceed that of the Member States. This will reaffirm the exceptionality 
of the fusion case, while at the same time showing that major global endeavours, such as the 
development of fusion energy through ITER, necessitate a different approach. Within the 7th 
EU Framework Programme (and here within the EURATOM part), the maximum amount for 
the  implementation  budget  dedicated  to  fusion  related  research  for  the  period  2007  to  2011 
will be €1947 million, which means more than a  doubling compared to the FP6 support. More 
than half of this amount is allocated to work involved in the construction of ITER, but not less 
than €900 million is reserved for other ITER re levant activities including fundamental plasma 
research  and  technology  development  projects.  It  must  be  noted  that  this  research  cannot 
directly be compared to other technologies given the scale of the initial investments needed 
for  constructing  ITER  (with  capital  costs  expected  to  be  some  €5  billion  and  the  total 
expected costs over its 35-year experimental lifetime reaching around €10 billion). 

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Public EU (EURATOM budget; annual average)

Public R&D spending of EU MS (2007)

Corporate R&D investment (2007) 

ca. €482 million

58%

42%

0%

n
o

i
l
l
i

m

120

100

80

60

40

20

0

1- 2007 data (gap-filled)
2- Annual average over the period 2002-2007

1

2

1

2

2

1

1

2

2

1

2

21

1

2

2

1

1

1

2

1

2

1 2

PT SE DK AT BE FI NL ES UK FR IT DE

Figure 21: 

Approximate R&D investment in nuclear fusion from industry and public sectors 

Source: JRC-IPTS based on IEA RD&D statistics and official information from some Member States; FP6; EU 
Industrial R&D Investment Scoreboard 

Note: Some EU Member States are not IEA member and do thus not figure in the database; for others no data 
are available. No annual average estimated for Belgium due to a limited number of data. 

4.3. 

Analysis of uncertainties 

Both  the  assumption-based  approach  for  estimating  corporate  R&D  investments  by 
technology and the data on public R&D investments are associated with some uncertainties. 
The main uncertainty related with the estimates of corporate R&D investments stems from the 
assumption-based allocation process used for breaking down a company's R&D investment in 
the  technologies  considered  in  the  report,  and  from  missing  data  for  some  companies.  With 
regard  to  public  R&D  investments,  differences  in  the  extent  to  which  individual  Member 
States include regional funding, institutional budgets and support to demonstration activities 
in  their  submission  to  the  International  Energy  Agency  are  the  main  source  of  uncertainty. 
Finally,  the  project-based  allocation  process  of  the  EU  FP6  funds  is  a  potential  source  of 
(minor) errors.  

4.3.1.  Uncertainties associated with estimates for corporate energy R&D investments 

The analysis of corporate R&D investments by technology includes a number of uncertainties, 
the  level  of  which  depend  on  whether  exact  figures  could  be  obtained,  official  data  was 
available as a starting point, or 'educated guesses' had to be made.  

Figures  with  a  'very  high  accuracy'  (or  very  high  confidence  level)  could  be  obtained  for 
companies  

•  for which the R&D investment is known through annual reports or the EU Industrial R&D 
Investment Scoreboard, and that are active exclusively in one technological field. Here, it 
was  assumed  that  100%  of  the  well-known  total  R&D  investment  is  allocated  to  the 
respective technology; 

•  that provided the exact breakdown of their R&D investments either through direct contact 

or in official publications. 

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€
 
 
The  uncertainty  associated  with  figures  on  R&D  investment  for  this  group  of  companies  is 
estimated to be in the order of ±2%. 

Figures with 'high accuracy' (or high confidence level) are those that may be slightly inexact, 
but the probability of missing at least the right range is very low with an estimated uncertainty 
range around ± 10%. They relate to  

•  companies for which the estimates made in the present report were refined through direct 
contact, but which did nevertheless not provide exact figures on their R&D investments by 
technology; 

•  companies for which the present estimates (or range) are supported by figures from other 

studies. 

Figures  with  'significant  uncertainties'  relate  to  estimates  that  had  to  be  made  on  the 
allocation of the total R&D investment to individual SET-Plan priority technologies. This is 
the case for companies that are active in various fields at the same time and for which none of 
the  above  two  points  applies.  Here,  the  R&D  expenditures  have  been  assessed  with  the 
methodology  described  above,  which  relies  on  a  number  of  assumptions  based  on  indirect 
indicators (such as the number of staff or patents; total sales by division), press released and 
expert  guesses.  Whenever  possible,  different  approaches  have  been  combined  in  order  to 
control  the  uncertainties  related  with  one  approach.  For  example,  an  analysis  based  on  the 
number  of  R&D  employees  working  in  this  specific  technology  was  cross-checked  with  a 
parallel  assessment  based  on  patents  or  turnover.  Nevertheless,  the  estimates  made  for  the 
R&D investments for this group of companies are approximate values only and we assume an 
uncertainty range that may reach ± 50% of the central estimate.  

Overall,  the  allocation  process  thus  proves  to  be  the  greatest  source  of  uncertainty  in  the 
approach. Enhancing the level  of  certainty of the  outcome  would  require  a  more  systematic 
research.  A  more  comprehensive  analysis  will  require  an  intensified  direct  contact  to 
companies,  a  more  systematic  assessment  of  the  companies'  patent  registrations,  an 
assessment of the business areas and a closer look into press announcements that may reveal 
plans for future development and thus allow some conclusions regarding R&D priorities (see 
also section 3.2.5).  

Finally, there have been a few companies for which the lack of information did not even allow 
a rough estimate. However, this does not concern any of the major R&D investors and would 
thus not distort the aggregated result to a large extent. The total lack of data typically occurred 
for some small companies active in one technological area only, such as biofuels or H2/FC. It 
can  also  refer  to  companies  for  which  the  total  R&D  expenditure  is  available  from  the  EU 
Scoreboard  but  the  lack  of  any  information  did  not  allow  any  allocation  to  individual 
technologies. 

Figure 22 illustrates the distribution of results with the various levels of accuracies in terms of 
both the number of companies and the total R&D investment.  

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Number of EU companies 
(total of 136)

Share of corporate R&D investments

Very high accuracy

High accuracy

Significant uncertainty

No data

21

68

Very high accuracy

33

High accuracy

Significant
uncertainty

56%

14

24%

20%

Figure 22: 

Number of companies and share of corporate R&D investments by level of uncertainty of 
the analysis  

Source: JRC-IPTS 

Applying the uncertainty  ranges  of ±2%, ±10% and ±50% to the overall results, the overall 
uncertainty  in  the  total  corporate  R&D  investment  could  amount  to  a  maximum  of  ±  €568 
million,  roughly  ±30%  of  the  total46.  This  figure  does,  however,  not  include  any 
uncertainties that stem from the fact that some companies are not considered due to lack of 
data.  

The composition of companies associated to the different levels of accuracy and with it the 
uncertainty  ranges  vary  across  individual  technological  sectors.  In  the  areas  of  wind  energy 
and  CSP  with  an  elevated  share  of  specialised  companies,  the  R&D  investments  can  be 
estimated  with  a  very  high  accuracy  for  more  than  75%  of  the  companies  considered.  This 
share  decreases  for  PV  (around  40%)  and  even  more  so  for  sectors  such  as  CCS  and  smart 
grids, in which most of the companies considered are active in multiple business fields, thus 
necessitating an assumption-based breakdown that decreases the level of accuracy.  

While the above description applies for the estimates made for the year 2007, the uncertainties 
associated to the rough estimates provided for the year 2006 are larger as the latter are partly 
derived from the hypotheses made for the year 2007. This is described in more detail in box 3. 

Box 3 - Methodology and uncertainties for approaching the 2006 R&D corporate 
investments 

The scope of this report lies in the estimation of selected R&D investments for the year 2007. 
As an assessment of a one-year snapshot, however, bears a risk of giving too much weight to 
one-off  events  or  data  mavericks,  it  was  decided  to  also  include  an  annual  average  of  the 
public  national  R&D  expenditure  between  2002  and  2007  (see  section  1.1.1).  Even  though 
data scarcity does not allow for a similar approach  on corporate  R&D investments, a rough 
estimation  of  the  corporate  R&D  investments  for  the  year  2006  has  been  carried  out. 
Nevertheless, the accuracy of the 2006 figures remains below the 2007 estimates. This is due 
to  the  fact  that  a  simplified  approach  has  been  used  for  estimating  2006  corporate  R&D 
investments,  partly  derived  from  the  assumptions  made  for  2007.  Depending  on  the  data 
availability for an individual company, an estimate has been produced on the following basis:  

46 

An uncertainty analysis performed at the level of individual companies indicates a smaller uncertainty 
range of ±18% but contains some methodological problems and has thus not been further pursued.  

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1- The exact figure has been taken from official reports, the EU R&D scoreboard, etc. where 
available for 2006. 

2- The total R&D investment was provided for 2006 but there was no information about how 
it was spread over the SET-Plan priority technologies. In this case, the same share (in terms of 
percentage of the total R&D) has been assumed as for the year 2007. This extrapolation is the 
source  of  some  additional  uncertainties  given  that  the  assumptions  were  originally  'tailored' 
for the year 2007.  

3-  It  has  been  assumed  that  the  2006  R&D  investments  are  equal  to  2007  figures.  This  is 
mainly assumed for small companies for which no information was available for 2006. This 
requires an idea on whether significant changes in the R&D activities from 2006 to 2007 have 
occurred for the company considered. 

4- An estimate of the 2006 R&D expenses has been obtained on the basis of the number of 
R&D  employees  in  the  year  2006.  This  approach  was  mainly  applied  for  companies 
specialised in a particular technology (e.g. fuel cells small companies). 

All in all, the results for 2006 are associated with higher uncertainties than the 2007 figures, 
impeding  a  direct  comparison  between  them.  Nevertheless,  we  consider  that  the  accuracy 
allows  a  qualitative  indication  of  the  trends  in  corporate  R&D  investments,  without  being 
able to quantify it with a high degree of precision.  

4.3.2.  Uncertainties associated with estimates for public energy R&D investments 

As the assessment of national public R&D investments of EU Member States largely draws 
on  the  IEA  RD&D  statistics  and  refers  to  the  GBOARD  only  as  a  reference  for  cross-
checking  on the  aggregated  level,  the  following assessment of uncertainties focuses on data 
based on the IEA database.  

Uncertainties in the IEA figures mainly originate from the differences in the extent to which 
individual  Member  States  include  regional  funding,  institutional  budgets  and  support  to 
demonstration  activities  in  their  original  data.  Such  discrepancies  limit  the  accuracy  of  a 
direct  comparison  across  Member  States.  Furthermore,  it  needs  to  be  noted  that  even  for  a 
given Member State, this may change over time, adding some uncertainty when assessing the 
R&D trends over time. The mismatch between IEA members and EU Member States as well 
as the lack of data for some IEA members for a certain year and technology makes it difficult 
to derive an aggregated figure for the EU Member States' public energy R&D investment. As 
this is nonetheless needed  for the present analysis, it had to be approximated by  applying a 
gap  filling  procedure  and  by  excluding  some  Member  States  from  the  analysis  of  public 
national  R&D  investments  (unless  official  data  could  be  obtained  through  the  consultation 
process  with  Member  States).  The  impact  of  the  above  limitations  on  the  present  results  is 
discussed below. 

According  to  the  IEA  questionnaire  (IEA,  2008),  federal  R&D  budgets  should  be 
complemented  by  regional  (e.g.  provincial)  R&D  spending  when  significant.  Even  so,  this 
does not seem to be the case for many countries, while it is included for others (e.g. Belgium). 
In the case of Germany, for example, R&D support through regional governments (Länder) is 
not part of the data underlying the IEA statistics. The regional support to non-nuclear energy 
R&D of the 16 German Länder amounted to around €96 million in 2006 (Schneider, 2007), 
equivalent to considerably more than one third of the  equivalent federal  budget  in 2006.  At 

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the aggregated EU-level, the regional German funds would be in the order of 4% (including 
both  nuclear  and  non-nuclear  energy  R&D  as  one  may  assume  that  regional  funds  directed 
towards  nuclear  R&D  are  of  limited  nature).  Unfortunately,  the  under-estimation  on  the 
aggregated  EU  level  that  stems  from  the  non-inclusion  of  some  regional  funds  cannot  be 
further quantified as it would require an in-depth assessment of the national data included in 
the IEA RD&D statistics, which has been outside the scope of the present work. However, it 
must  be  noted  that  regional  R&D  funds  take  an  important  role  only  in  a  limited  number  of 
Member  States,  foremost  all  Germany,  for  which  an  estimation  of  the  uncertainty  could  be 
performed.  One  may  thus  speculate  that  the  total  uncertainty  stemming  from  potentially 
missing regional funds should not exceed some ±10-15% of the total. 

The IEA data focuses on energy-related R&D and as such excludes basic research 'unless it is 
clearly oriented towards the development of energy-related technologies' (IEA, 2008; section 
3.1).  Often,  this  implies  that  the  national  data  relate  to  a  national  energy  R&D  programme, 
thus missing additional energy-related R&D spending that stem from other programmes (such 
as  defence  or  general  research  programmes).  At  the  same  time,  parts  of  the  institutional 
funding included may in practice cover research of a more basic nature. The extent to which 
such data are included can not be further quantified. It is expected to vary across the Member 
States,  influenced  by  the  structure  of  their  national  energy  research  programmes  and 
institutional set-up, and must be taken into account when comparing Member States' data one 
with another. 

As explained in section 3.1, the data included in the IEA RD&D statistic shall capture public 
national support to demonstration activities in addition to their R&D support. However, most 
of the IEA members do not include or display this data. The share of demonstration activities 
thus remains small in general, yet differs between countries and technologies (Figure 3). This 
needs to be kept in mind when comparing data across countries and technologies.  

Data gaps make it difficult to assess the trend of R&D investments over time (such as the one 
shown in Figure 10). This is due to changes in the methodology, the geographical coverage 
etc. For example, the German data prior 1992 do not include the new Länder. Other Member 
States have provided only partial information for few years. For Belgium, data for the years 
2000-2006 are missing. France recently changed the methodology applied for calculating its 
national  public  research  and  development  expenditure  on  energy  (DGEMP  2007; 
MEEDDAT, 2008). Public budgets were re-calculated officially in accordance with the new 
methodology back to the year 2002 and match the IEA figures for those years. The figures of 
the IEA database prior to 2002 relate to the previous methodology. Any trends over time need 
to  note  this  break  in  series,  in  particular  considering  the  discrepancy  between  the  two 
approaches (e.g. the results differ by a factor of 1.9 for the year 2002) and the fact that France 
accounts for around one third of the EU Member States' aggregated budget. Despite this risk 
of distortion it was decided to not manipulate the IEA data for France prior to 2002, but to 
restrict  the  analysis  to  the  data  directly  available  from  the  database  in  order  to  ensure 
comparability with other sources.  

As mentioned in section 1.1.1, only 19 of the 27 EU Member States are IEA members. This 
implies  that  the  database  systematically  contains  no  data  for  Bulgaria,  Cyprus,  Estonia, 
Latvia,  Lithuania,  Malta,  Romania,  and  Slovenia.  A  comparison  with  the  energy  R&D 
budgets  according  to  the  GBAORD  database,  which  includes  data  for  most  Member  States, 
reveals that the mistake made in the EU-aggregate that is caused by the lack of data for some 
Member States remains limited (see Table 5). The aggregated R&D budgets of the Member 
States  covered  by  the  IEA  database  account  for  around  99%  of  the  overall  EU-27  energy 

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budget  according  to  GBAORD  data,  notwithstanding  that  the  contributions  of  the  missing 
Member States may be higher for individual technologies.  

The aggregated EU Member States' national public R&D budgets would be more distorted by 
the lack of data on R&D investments that occur for some IEA members for a single year – 
often  the  most  recent  year;  here:  2007  –  and  technology.  At  the  time  of  downloading  the 
information form the IEA RD&D statistics in January 2007, information on their 2007 energy 
R&D investments was lacking for 10 of the countries assessed. Consequently, the aggregated 
figure for the year 2007 would have summed up to €1237 million only. Due to the exchange 
of  data  with  a  number  of  Member  States,  official  national  figures  could  be  obtained  to  fill 
these gaps for three countries (and adapt the figures for two others); for the others, a simple 
gap filling procedure has been applied. For entries missing for 2007, the value from the latest 
available  year  was  applied  down  to  the  year  2003.  Overall,  once  the  'data  gaps'  are  filled, 
public  national  energy  R&D  investments  in  2007  are  almost  a  factor  of  two  above  the 
aggregate that was based on the 'raw data', and are well in line with the levels found for the 
years before and the GBAORD figures. This result justifies the data manipulation applied in 
the present report.  

The  distortion  caused  by  the  gap  filling  procedure  is  limited.  Gap  filling  with  values  from 
previous  years  has  been  done  for  three  countries  with  a  total  R&D  investment  of  €257 
million. If one assumes that the maximal annual changes of their energy R&D investments do 
not exceed the relatively high value of 20%, the mistake caused by the gap filling would be 
€57  million,  equivalent  to  2.4%  of   the  total  aggregated  figure  over  all  EU  Member  States 
considered. Of course, for some technologies, a more drastic gap filling procedure has been 
necessary. Nevertheless, given that the main interest of this report lies on the aggregated EU 
figures, the gap filling approach seem appropriate and the related distortions could be limited 
due to the direct exchange of data with some Member States.  

In total, we assume that the potential errors made in the estimation of the aggregated public 
R&D investments of EU Member States should not exceed ± 13 to 19%, notwithstanding that 
it may be larger for individual technologies. 

Main uncertainties associated with the assessment of EU R&D funds under FP6 results from 
the biunique allocation of individual projects to one group of SET-Plan technologies and the 
assumption  of  an  even  split  of  the  investments  over  the  entire  duration  of  FP6.  The  latter 
seems fully justified for the present work as it levels out annual fluctuations due to the project 
cycles.  

In  order  to  avoid  double-counting  of  projects,  as  a  general  principle  the  funding  of  an 
individual project was allocated to not more than one technology. Considering that a number 
of projects simultaneously undertake research in fields related to different groups (e.g. CCS 
and hydrogen production), this leads to an uncertainty associated with the aggregated EU FP6 
funds by SET-Plan priority technology. This is most elevated for the sector hydrogen and fuel 
cells:  if  all  related  projects  were  accounted  for  in  this  sector  instead  of  removing  those  that 
have their research focus in other technological fields, the total FP6 funds would amount to 
€318 million over the period 2002-2006 instead of 
this  report  (i.e.  ±  13%).  Also  for  CCS,  biofuels  and  to  a  lesser  extent  CSP  the  bijective 
allocation  process  generates  some  distortion.  At  the  aggregated  level  over  all  technologies, 
however, these uncertainties level out unless they occur between SET-Plan priority and non-
priority  technologies  (such  as  between  transport  biofuels  and  bioenergy).  We  estimate  this 
error to not exceed ± 5%. 

the central figure of €279 million used in 

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4.3.3.  Combined uncertainties 

Not  all  uncertainties  of  the  present  analysis  can  be  quantified.  In  particular,  the  present 
assessment of corporate R&D investments tends to be an under-estimation of total industrial 
research efforts in this area, given that a number of companies could not be included in the 
present  assessment  due  to  either  the  lack  of  data  or  their  missing  inclusion  in  the  list  of 
relevant companies by technology. Furthermore, important up-stream research activities that 
are realised in the supply chain could only be captured to a limited extent. 

Keeping in mind that the overall figures tend to be an underestimation, an upper range of the 
uncertainties  related  with  the  R&D  investments  that  are  included  in  the  present  assessment 
can be roughly quantified. Assuming from the above reasoning an overall uncertainty of not 
more  than  ±  30%  for  the  estimates  on  the  corporate  R&D  investments,  ±  19%  for  public 
national  investments  and  ±  5%  for  the  EU  funds,  the  cumulative  error  on  the  total  R&D 
investment in SET-Plan priority technologies (€3.3 billion) would not exceed ± €784 million, 
or 24% of the total. 

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5. 

CONCLUSIONS 

The  present  report  provides  an  estimate  of  the  current  corporate  and  public  European  R&D 
investments in those low-carbon technologies that are of particular interest in the context of 
the  European  Strategic  Energy  Technology  Plan47  ('SET-Plan  priority  technologies').  Its 
ultimate objective is to offer a benchmark of the current R&D spending of those technologies 
to serve as a basis for the comparison with their future R&D needs48.  

For corporate and Member States' national public R&D spending the focus of the analysis lies 
on the 2007 figures while the relevant EU R&D investments are annualised figures under FP6 
(2002-2006). In order to avoid putting too much weight to one-off events or data mavericks, 
annual  average  of  the  public  national  R&D  expenditure  between  2002  and  2007  are  also 
included for comparison as well as a very rough estimation of the corporate R&D investments 
for the year 2006.  

Currently,  no  single  database  exists  which  would  allow  for  an  estimation  of  the  overall 
research  efforts  by  technology  in  the  EU-27.  Data  are  particularly  sketchy  with  regard  to 
corporate R&D, even though public R&D budgets are also incomplete. The low availability 
of data on industrial R&D data is influenced by the fact that companies consider information 
on  their  detailed  R&D  expenditure  as  confidential.  Therefore,  a  new  methodology  has  been 
developed  for  assessing  corporate  R&D  investments  on  company  level.  For  each  SET-Plan 
priority  technology,  the  number  of  key  R&D  investors  has  been  identified.  A  company's 
overall  R&D  investment  has  then  been  allocated  to  individual  technologies  based  on  the 
combination of publicly available information with expert judgment. Hence, the estimates of 
corporate R&D investments are subject to significant uncertainties. They should thus not be 
used or compared without taking into account the methodological limitations of this approach.  

With regard to public national R&D funding, the most recent available data (2007) have been 
used  from  Eurostat  (GBAORD)  and  the  International  Energy  Agency,  complemented  by 
information that was directly obtained from various Member States. Unfortunately, both the 
GBOARD and the IEA databases miss some entries at the technological level of detail needed 
and not all EU Member States are covered in the IEA database as only 19 EU Member States 
are also IEA members. Data missing for 2007 have been gap filled with data from previous 
years back to 2003 if available.  

For  an  overview  of  the  EU  funding,  the  6th  Research  Framework  Programme  and  the 
EURATOM Framework Programme were assessed. An assessment of the basis of individual 
project  has  been  performed,  going  beyond  projects  financed  under  the  'core  energy  budget 
line'  'sustainable  energy  systems'  and  also  including  relevant  projects  funded  under  budget 
lines such as 'sustainable surface transport' or 'Horizontal research activities involving SMEs' 
etc. An annual average of the commitments has been used for these multiannual programmes 
(2002-2006).  

47 

48 

Technologies  included  are:  hydrogen  and  fuel  cells;  wind  energy;  photovoltaics;  concentrating  solar 
power;  carbon  capture  and  storage;  biofuels;  smart  grids;  nuclear  fission  (Gen  IV  reactors);  nuclear 
fusion. 
See  section  2.1  for  a  definition  of  the  boundaries  of  R&D.  The  underlying  data  also  include  some 
support to some demonstration activities (in particular the public national budgets), but the focus of the 
assessment lies on the R&D investments. 

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Both the basic data as well as the approach applied in the present work are associated with a 
number  of  potential  errors.  The  main  uncertainties  for  the  estimates  of  corporate  R&D 
investments  derive  from  the  assumption-based  allocation  process  used  for  breaking  down  a 
company's  R&D  investment  in  the  technologies  considered  in  the  report.  Furthermore,  it  is 
reasonable  to  assume  that  the  results  on  industrial  R&D  investments  constitute  a  lower 
estimate of industrial research efforts, resulting from the lack of data and the limitation in the 
number  of  companies  included  in  the  assessment.  Moreover,  important  up-stream  research 
activities that are realised in the supply chain could only be captured to a limited extent. With 
regard  to  public  R&D  investments,  differences  in  the  extent  to  which  individual  Member 
States include regional funding, institutional budgets and support to demonstration activities 
in their submission to the International Energy Agency add some uncertainty. Also the lack of 
data  for  an  individual  year  and  technology  and  the  resulting  gap  filling  process  forms  a 
potential source of error.  

Keeping  in  mind  that  the  overall  figures  on  corporate  R&D  efforts  tend  to  be  an 
underestimation,  an  upper  range  of  the  uncertainties  associated  with  the  R&D  investments 
presented in the following can be roughly estimated. Applying an overall uncertainty range of 
not more than ± 30% for the estimates on the corporate R&D investments, ± 19% for public 
national  investments  and  ±  5%  for  the  EU  funds,  the  cumulative  error  on  the  total  R&D 
investment in SET-Plan priority technologies does not exceed ± 24% of the total even though 
higher  uncertainties  may  apply  to  the  results  related  to  one  individual  technology.  Future 
work  may  reduce  the  uncertainties  associated  with  the  estimation  of  corporate  R&D 
investments  by  expanding  the  list  of  companies  assessed,  enhancing  direct  contact  with 
industries;  and  making  a  more  systematic  use  of  indirect  indicators  such  as  patent 
applications. 

Despite  the  uncertainties  described,  the  order  of  magnitude  of  the  results  obtained  in  the 
present report is supported by a comparison with other sources both on the overall level and at 
the  level  of  individual  technologies  and  funders.  It  can  thus  be  considered  as  a  reasonable 
approximation of the present R&D investments.  

Hence,  the  following  substantiated  conclusions  can  be  derived  on  the  basis  of  the  present 
assessment.  Due  to  the  different  nature  of  nuclear  and  non-nuclear  energy  research,  the 
respective conclusions are being kept apart with points (1) to (3) relating to non-nuclear R&D, 
(4) on nuclear and (5) and (6) on nuclear and non-nuclear research. 

(1) 

R&D  investments  in  non-nuclear  SET-Plan  priority  technologies  amounted  to 
€2.38 billion in 2007 49 in the EU. The fact that large parts of non-nuclear energy 
research  are  dedicated  to  these  selected  low-carbon  technologies  indicates  that 
they  are  seen  as  a  strategic  research  field  by  both  public  and  industrial  R&D 
investors. 

National  public  non-nuclear  energy  R&D  budgets  in  EU  Member  States  amounted  to  more 
than €1.6 billion in 2007, out of which €571 mil
lion were dedicated to non-nuclear SET-Plan 
priority  technologies.  The  increase  of  R&D  investments  in  non-nuclear  SET-Plan  priority 
technologies since the late 1990s meant that their share in the total non-nuclear energy R&D 

49 

2007 figures  are provided  for  corporate  and  Member  States'  national public  R&D spending  while  the 
relevant EU R&D investments are annualised figures under FP6 (2002-2006). 

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spending rose from around 20% in 1999 to 34.5% in 2007, indicating the rising importance 
being given to those technologies. 

Under  the  6th  Research  Framework  Programme,  the  EU  spent  around  €157  million  on  non-
nuclear  SET-Plan  priority  technologies  on  an  annual  average.  No  detailed  figures  could  be 
obtained on the level of detail needed from FP7 (2007-13). However, taking into account that 
the average annual non-nuclear energy R&D budget has increased substantially compared to 
FP6,  one  may  assume  that  also  budgets  directed  to  (some)  non-nuclear  SET-Plan  priority 
technologies are above those of FP6.  

Almost 39% of the European public non-nuclear energy research budget (including Member 
States  and  the  EU  FP6  contribution)  are  dedicated  to  the  non-nuclear  SET-Plan  priority 
technologies considered in the present report. This figure would increase to more than 50% if 
instead of including only R&D on wind, PV, biofuels and CSP, all renewable energy-related 
research was included. 

Both in absolute and in relative terms this puts the EU in front of the US and Japanese public 
R&D  funds  dedicated  towards  a  similar  set  of  'non-nuclear  SET-Plan  priority  technologies', 
despite both countries having slightly larger total energy-related R&D budgets (yet including 
nuclear).  However,  such  comparison  is  misleading  as  it  disregards  the  fact  that  the  US  and 
Japanese  energy  programmes  are  strongly  focussed,  while  synergies  between  EU  Member 
States currently remain under-exploited due to limited alignment of national programmes and 
the slow uptake of joint activities. 

The  significant  corporate  R&D  investments  in  non-nuclear  SET-Plan  priority  technologies 
indicate that these technologies are also being considered as important by industry. Corporate 
R&D investments exceeded €1.65 billion in 2007, implying an important increase from 2006 
in the order of magnitude of some 15%.  

No  data  are  available  that  would  allow  for  an  assessment  of  the  share  of  corporate  R&D 
investments  dedicated  to  non-nuclear  SET-Plan  priority  technologies  within  the  overall 
energy-related R&D investments of industry. However, a very rough comparison with other 
studies  indicates  that  research  investments  for  SET-Plan  priority  technologies  play  an 
important role in total corporate energy R&D investments. The (rising) importance given to 
R&D into SET-Plan priority technologies by both the corporate and the private sector would 
also  be  supported  by  the  increasing  number  of  patent  applications  in  renewable  energy 
technologies (Johnstone et al., 2008).  

Even so, the R&D intensities in those sectors for which a turnover could be obtained remain 
low  compared  to  other  emerging  sectors.50  For  the  wind,  PV  and  biofuel  sectors,  the  R&D 
intensities derived from the present report are in the order of 2.2-4.5%. Even though they are 
well  above  the  R&D  intensities  of  traditional  energy  companies  (see  below  conclusion  3), 
they fall largely behind the R&D intensities of other sectors that experienced a boom in recent 
years, such as the IT-related sectors 'software', 'computer hardware' or 'semi-conductors' with 
R&D intensities in the order of 8% to 18% over the past five years51.  

50 

51 

Note that from a methodological point of view R&D intensities cannot directly be compared between 
different sectors due to the considerable differences in their innovation systems (see e.g. Malerba, 2004, 
on sectoral systems of innovation; Kaloudis and Pedersen, 2008, on the energy sector).  
Figures relate to EU-based companies and are taken from various versions of the EU Industrial R&D 
Investment Scoreboards (Hernandez Guevara et al., 2008). 

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(2) 

Aggregated  public  and  corporate  R&D  investments  are  in  a  similar  range  for 
most  non-nuclear  SET-Plan  priority  energy  technologies.  Exceptions  are  R&D 
funds  dedicated  to  hydrogen  and  fuel  cells  and  those  for  concentrating  solar 
power.  

European  R&D  investments  dedicated  to  CCS,  smart  grids,  biofuels,  wind  energy  and 
photovoltaics are in-between €270 million and €380  million each (see Table 7). Substantially 
larger R&D investments were found only for hydrogen and fuel cells research. This may be 
explained by the fact that this field comprises a broad diversity of different technologies from 
various ways of hydrogen production to manifold areas of applications for fuel cells, and is 
thus  of  interest  to  a  large  number  of  large  and  small  companies  with  different  backgrounds 
(e.g. car manufacturers; electric utilities; chemical companies and component suppliers). On 
the  other  hand,  R&D  investments  in  Concentrating  Solar  Power  are  considerably  below 
investments in other SET-Plan priority technologies due to the fact that this technology is of 
interest to a limited number of EU countries and companies only.  

Corporate 
R&D 
investment 
2007  
(€ million)  

Public EU 
(FP6 
respectively 
EURATOM; 
avg per year) in 
€ million  

Public R&D 
spending of 
EU Member 
States in 
2007  
(€ million)  

Total 

(Out of 
which 
demonstra
tion in 
MS 
national 
budgets) 

Non-nuclear SET-P priority technologies 

Hydrogen and fuel cells 
Wind 

PV 
CCS 

Biofuels 
Smart Grids 

CSP 
SUM (non-nuclear LC techs) 
Distribution by investor 

Nuclear SET-P priority technologies 

Nuclear Fission reactor (mainly 
reactor related research, thus 
without safety, waste, environment) 

Nuclear Fusion 
Total SET-Plan priority energy 
technologies 

375 

292 

221 

240 

269 

212 

48 

1656 
69% 

205 

0 

1862 

70 

11 

27 

17 

13 

14 

5 

157 
7% 

4 

204 

366 

Other relevant energy technology groups (including some of the above) 
Fossil Fuels 
All Renewable Energies 

n.a. 
n.a. 

n.a 
94 

Bioenergy 

Total Nuclear Fission  

n.a. 

550 

31 

115 

Table 7: 

Summary of results 

Source: JRC-IPTS, rounded numbers 

171 

81 

136 

39 

65 

47 

33 

571 
24% 

(24) 

(24) 
(15) 

(0) 
(19) 

(5) 
(1) 

(88) 

616 

383 

384 

296 

347 

273 

86 

2385 
100% 

248 

(0) 

458 

278 

1097 

240 
557 

245 

587 

482 

3325 

1252 

(88) 

(5) 
(142) 
(94) 

(1) 

The  uncertainties  stemming  from  the  methodology  applied  in  this  report  do  not  allow  a 
precise ranking of R&D investments by technology as uncertainties may reach the same order 
of  magnitude  as  the  actual  differences  between  the  R&D  investments  found  for  those 
technologies. In particular, uncertainties for corporate R&D investments are larger for those 
technological fields that attract large companies which are simultaneously active in research 

EN 

69 

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on  various  technologies.  This  is  the  case  e.g.  for  hydrogen  and  CCS,  while  many  of  the 
companies active in e.g. wind energy research primarily work in this area. In the latter case 
uncertainties are reduced as no assumptions would need to be made on how R&D investments 
are distributed across different technologies. At the same time, public R&D budgets may be 
underestimated for novel technologies such as CCS, biofuels or smart grids, thus creating an 
additional uncertainty. 

(3) 

Corporate  R&D  investments  account  for  an  important  share  in  overall  R&D 
spending  for  almost  all  non-nuclear  SET-Plan  priority  energy  technologies. 
Component  suppliers,  machinery  industry  and  specialised  (alternative)  energy 
companies play an important role for innovation in the energy sector.  

Corporate  R&D  investments  account  for  almost  70%  of  the  total  R&D  spending  in  non-
nuclear low carbon technologies. This hints at the active role of EU-based companies in these 
technologies  and  the  acknowledgment  of  the  importance  of  R&D  for  maintaining  a  strong 
profile in those promising technologies.  

The  assessment  indicates  that  innovation  in  the  energy  sector  may  not  predominantly  being 
carried  out  by  classical  energy  companies  such  as  electric  utilities  or  oil/gas  suppliers. 
Industries  with  elevated  research  activities  in  low-carbon  energy  technologies  include 
companies  active  in  industrial  machinery,  chemicals,  energy  components  or  those  that  are 
exclusively active in one area. This finding is also confirmed by the R&D intensities (2.2%-
4.5%)  found  for  a  number  of  SET-Plan  priority  sectors,  which  are  well  above  those  of 
companies active in the electricity sector (0.6%) and oil and gas producers (0.3%). Their order 
of  magnitude  rather  compares  to  the  R&D  intensities  of  producers  of  electrical components 
and equipment (3.4%) and industrial machinery (2.6%). This indicates that important parts of 
the  energy  research  are  being  carried  out  by  companies  other  than  traditional  energy 
companies (and that companies may consider the SET-Plan priority technologies as important 
research areas).  

This result is supported by previous assessments (e.g. Jacquier-Roux and Bourgeois, 200252). 
It is in line with the hypothesis that classical energy companies show a limited R&D intensity 
due  to  the  fact  that  they  produce  a  homogenous  good  (electricity;  fuels)  with  price 
competition  being  the  main  competition  success  criterion;  the  energy  sector  could  thus  be 
described as a 'supplier-dominated sector' following the classification of Pavitt (1984).  

(4) 

Substantial investments are also dedicated to R&D in nuclear SET-Plan priority 
technologies (approx. €0.9 billion). Fusion  R&D receives high public budgets due 
to the capital investment needs of the on-going ITER construction.  

Even  though  all  nuclear  electricity  production  is  considered  low  carbon,  the  focus  of  the 
nuclear-fission related research in the SET-Plan lies on generation IV reactors. Unfortunately, 
no estimation of the R&D investments for generation IV  reactors  could be made  within the 
present report. Nonetheless, in order to narrow down the nuclear fission related nuclear R&D 
investments, research efforts on nuclear reactor technologies have been used as a proxy, even 
though  this  approach  overestimates  the  generation  IV-related  parts  of  the  R&D  spending. 

52 

See  also  Kaloudis  and  Pedersen  (2008)  who  state  that  "Very  schematically,  we  could  claim  that  the 
sector is polarised between large, non-R&D process innovating incumbents on the one hand, and on the 
other  hand  small  new  entries,  often  R&D-based  and  specialised  on  one  type  of  renewable  energy 
technology." 

EN 

70 

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Nuclear reactor related R&D investments total around €460 million, almost half of which is 
being  financed  by  industry  (45%).  Both  private  and  public  R&D  efforts  are  largely 
concentrated in France. Public sector financing tends to concentrate on commercially riskier, 
longer-term and pre-competitive R&D, e.g. that currently being undertaken on generation IV 
reactor systems. 

Fusion-related  energy  research  constitutes  an  exception  in  a  threefold  way.  Firstly,  it  is 
implemented through a single European Programme, which explains the high contribution of 
EU  EURATOM  funds.  Secondly,  there  is  currently  hardly  any  industry  investing  in  fusion 
given the long time horizon of this research area. Thirdly, the forthcoming construction phase 
of  ITER  is  associated  with  high  capital  investments  on  a  large  scale  research  infrastructure 
that  will  be  used  by  the  global  fusion  research  community  for  a  long  period  of  time.  These 
factors explain the R&D investments in nuclear fusion of around €482 million in 2007 and the 
further increase of the budgets for the next years, all of which are publicly financed. In FP7, 
the Euratom contribution has risen to €1947 million over 5 years.  

(5) 

Both  public  and  corporate  R&D  investments  in  SET-Plan  priority  technologies 
are  largely  concentrated  in  a  limited  number  of  EU  Member  States.  For  many 
technologies,  the  countries  with  high  public  R&D  funds  simultaneously  account 
for the largest corporate R&D investments. 

The assessment of the present report indicates that more than 99% of the aggregated national 
(nuclear  and  non-nuclear)  R&D  budgets  directed  towards  SET-Plan  priority  technologies 
originate  from  eleven  Member  States:  France,  Germany,  the  UK,  Denmark,  Italy,  Spain, 
Sweden,  Belgium,  the  Netherlands,  Finland  and  Austria  with  the  first  three  accounting  for 
almost 70% of the total. At the same time, the R&D investments from companies located in 
Germany, France, the UK, Denmark, Spain and Sweden were found to make up almost 95% 
of the total corporate investments.  

(6) 

Public and industrial research investments seem to complement one another.  

In  many  cases,  the  group  of  countries  that  give  strong  support  to  research  into  a  certain 
technology from public funds simultaneously shows the largest R&D investment of industry 
into  that  technology.  This  may  be  seen  as  an  indication  of  a  positive  correlation  between 
public  research  support  and  industrial  R&D  investments.  Such  a  hypothesis  would  be 
supported by Jaumotte and Pain (2005), who found that an increase of non-business R&D had 
a positive effect on both private sector R&D and patenting.  

Such  a  relation,  is  however  not  straight-forward.  Without  being  exhaustive,  Member  States 
may decide to support research to those technologies for which a domestic industry exists. At 
the  same  time,  technologies  that  are  considered  strategic  within  a  national  energy  strategy 
would be supported both through push (R&D) and pull (deployment) instruments, which may 
trigger the creation of a domestic industry for that technology. In this context, Johnstone et al. 
(2008) demonstrate on the basis of patent applications for renewable energies that both R&D 
policies and market introduction policies have a significant impact on the innovation activity 
in a country. 

According  to  the  classical  innovation  theory,  technologies  that  are  close-to-market  and  thus 
require expensive pilot plants and up-scaling would face larger industrial contribution, while 
technologies that are further from market are mainly publicly financed as industry would not 

EN 

71 

   EN 

 
want  to  take  the  risk.  At  the  same  time,  the  share  of  support  that  targets  demonstration 
activities within public budgets would be elevated for more mature technologies.  

This  theory  can  partially  be  supported  by  the  assessment  of  the  present  report,  even  if  the 
scope  of  the  report  includes  demonstration  only  to  a  very  limited  part  (see  section  2.1). 
Besides,  data  gaps  prevent  a  clear  proof.  Nevertheless,  it  can  be  observed  that  the  share  of 
corporate R&D investments is elevated for rather mature technologies like wind energy and 
biofuels53.  Also  the  publicly  funded  demonstration  activities  are  comparably  large  for  wind 
and biofuels. At the same time, PV, generation IV reactors and CSP experience relatively less 
industrial support (and a lower part of the public R&D funds is dedicated to demonstration). 
Following  the  above  hypothesis,  this  may  be  explained  by  the  fact  that  the  latter  three 
technologies  can  be  considered  as  less  mature  if  one  assumed  that  research  in  PV  largely 
focuses on new technologies rather than dealing with the more mature crystalline silicon cells. 
On  the  extreme  end,  all  fusion  related  research  is  publicly  funded.  Hydrogen  and  fuel  cell 
research  somehow  constitute  a  hybrid  due  to  the  fact  that  this  category  comprises  a  wide 
variety of technologies both on the fuel production as well as on the (mobile and stationary) 
consumption  side,  with  the  individual  technologies  having  reached  different  levels  of 
maturity.  

However,  the  above  finding  must  be  interpreted  with  care.  The  direct  comparison  between 
public  and  corporate  R&D  investments  faces  some  uncertainties  that  result  from  likely 
differences  in  the  definitions  of  R&D  between  these  actors  (see  also  section  2.1  for  a 
definition  of  the  scope  of  RD&D  covered).  The  publicly  (co-)  funded  research  budgets 
assessed  in  the  present  report  probably  tend  to  focus  on  basic  research  and  pre-competitive 
industrial  research,  while  industry  would  be  inclined  to  finance  more  applied  research, 
including pilot projects.  

53 

It  is  also  elevated  for  CCS.  This  may,  however,  be  due  to  an  under-estimation  of  the  public  R&D 
efforts. 

EN 

72 

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6. 

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l'énergie en France, 22 juillet 2008. 

Menna,  P.,  Gambi,  R.,  Gillett,  W.,  Tondi,  G.,  Anderson,  D.,  Deschamps,  G.,  Ostrom,  R., 
Scholz,  H.(2007):  European  Photovoltaic  RTD  and  Demonstration  Programme.  Paper 
presented  at  the  22nd  European  Photovoltaic  Solar  Energy  Conference,  Milan,  September 
2007. 

Naneva,  M.,  Paschos,  V.  (2008):  Assessment  of  corporate  R&D  investments  in  the  energy 
sector. Work prepared during an internship at the European Commission. 

Neef, H.-J. (2008): International overview of hydrogen and fuel cell research. Energy (2008), 
doi:10.1016/j.energy.2008.08.014. To be published. 

New  Energy  Finance  (2008):  Corporate  RD&D  into  clean  energy  in  2007:  General  Electric 
sets example. Research Note, 14 January 2008. 

OECD  (2002):  Proposed  Standard  Practice  for  Surveys  on  Research  and  Experimental 
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Orion  Innovations  (2008):  Hydrogen  Future  Study  –  HyFuture.  Report  prepared  for  the 
Scottish Hydrogen and Fuel Cell Association, Final Report, 31 March 2008.  

Pavitt, K. (1984). Sectoral patterns of technological change: towards a taxonomy and a theory. 
Research Policy Vol. 13, pp. 343-373. 

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Energy research. Revue de l'Energie, 576:77-85. 

Ruhl,  V.,  Lütter,  F.,  Schmidt,  C.  (2008):  Standortgutachten  Photovoltaik  in  Deutschland  - 
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(2007):  Förderung  der  nichtnuklearen  Energieforschung  durch  die 

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SRS  project  (2007):  Gathering  Energy  RTD  Expenditures:  The  conditions  for  data 
collections. Developed within the SRS NET & EEE project under FP6 ("Scientific Reference 
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TP Wind (2008): European Wind Energy Technology Platform - Strategic Research Agenda. 
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Van  Beeck,  N.,  Doukas,  H,  Gioria,  M.,  Karakosta,  C.,  Psarras,  J.  (2009):  Energy  RTD 
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Capacities in EU Member States. IPTS Scientific and Technical Reports EUR 23435. 

ZEP  (Technology  Platform  for  Zero  Emission  Fossil  Fuel  Power  Plants)  (2008a):  Zero 
Emission fossil fuel Power plants. Country profile UK. May 2008 update. 

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Industrial Initiative on CCS. Letter to Commissioner Piebalgs from 21. February 2008. 

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European Wind Energy Association. 

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7. 

LIST OF ACRONYMS 

billion 

Generation IV nuclear reactors 

Directorate-General for Research  

Framework Programme 
6th Research Framework Programme 

European Research Area Networks 
Electricity Research Road Map in Europe (FP6 project) 

BERD Business Expenditures on R&D 
BES  Business Enterprise Sector 
bn 
CCS  Carbon dioxide capture and storage 
CSP  Concentrating Solar Power 
DG RTD 
DG TREN  Directorate-General Energy and Transport 
DG  Directorate-General (of the European Commission) 
DoE  Department of Energy (USA) 
European Commission 
EC 
EII 
European Industrial Initiative 
EMEA Europe, Middle East and Africa 
EPIA  European Photovoltaic Industry Association 
ERA-NET 
ERMINE 
EU or EU-27  European Union 
EWEA European Wind Energy Association 
FP 
FP6 
GBAORD  Government Budget Appropriations or Outlays on R&D 
GDP  Gross Domestic Product 
GEN-IV 
H2/FC Hydrogen and Fuel Cells 
ICB 
IEA 
IPTS  Institute for Prospective Technological Studies (of the JRC) 
ITER  International Thermonuclear Experimental Reactor 
JRC 
JTI 
m 
MEEDDAT  Ministère  de  l'écologie,  de  l'énergie,  du  développement  durable  et  de 
l'aménagement du territoire (France) 
METI  Ministry for Economy, Trade and Industry (Japan) 
MS  Member State of the European Union 
NACE Statistical Classification of Economic Activities  
NNE  Non-nuclear Energy 
OECD Organisation for Economic Co-operation and Development 
PV 
R&D  Research and Development 
RD&D Research, Development and Demonstration 
RTD  Research Technology Development 
SETIS Strategic Energy Technology Plan Information System 
SET-Plan 
SME  Small and Medium Sized Enterprises 
SRS NET & EEE 
use efficiency and energy RTD (FP6 project) 
TP 

Joint Research Centre (of the European Commission) 
Joint Technology Initiative 
million 

Industry Classification Benchmark 
International Energy Agency 

Scientific  Reference  System  on  new  energy  technologies,  energy  end-

(European) Strategic Energy Technology Plan 

Technology Platform 

Photovoltaic 

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