Communication from the Commission - ‘Electra’- For a competitive and sustainable electrical engineering industry in the European Union
Date: 2009-10-29
Institutions: European Commission
Subjects: competitiveness, cooperation policy, electrical industry, energy saving, energy technology, innovation, research and development, sustainable development, technical regulations, vocational training

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 29.10.2009 
COM(2009)594 final 

COMMUNICATION FROM THE COMMISSION 

‘ELECTRA’ 

For a competitive and sustainable electrical engineering industry  
in the European Union 

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COMMUNICATION FROM THE COMMISSION 

‘ELECTRA’ 

For a competitive and sustainable electrical engineering industry  
in the European Union 

1. 

INTRODUCTION 

The May 2009 Competitiveness Council1 identified the electrical engineering industry (EEI)2 
as one of the keys to a competitive and strong industrial base in the European Union (EU). 

Electrical  engineering  is  one  of  the  biggest  industries  in  the  world.  Its  products  range  from 
simple  consumer  goods  to  highly  sophisticated  industrial  turbines,  power  grids  and  power 
stations. In the EU, the industry numbers some 200 000 enterprises, mostly SMEs, employing 
around  2.8  million  people.  In  2008,  total  production  was  worth  €411  bn  and  the  EEI 
accounted for 10 % of EU exports, which represented a slight trade surplus3. 

The EU ranks second in world EEI production with 21 %, behind China (30 %) and ahead of 
the US and Japan (both 19 %). In terms of value added, it is second behind the US, ahead of 
Japan  and  China.  European  EEI  products  have  a  good  reputation  for  quality  and  reliability. 
But  competitors  are  catching  up,  while  the  EU  has  not  yet  managed  to  close  the 
competitiveness gap with the US. A tailor-made vision for the EEI is needed to maintain and 
improve its competitiveness worldwide. 

The  European  EEI’s  future  as  a  producer  of  technologies  for  a  wide  range  of  applications 
depends on exploiting the high growth potential of particular markets among others in energy 
supply infrastructure, energy-efficient buildings, transport networks, industrial production and 
the development of smart technologies to suit existing and future societal needs. 

This Communication sketches the short- and long-term growth potential of those markets and 
lists the actions and instruments needed to keep the EEI competitive while at the same time 
unlashing  the  industry’s  potential  to  contribute  to  the  EU’s  2020  climate  change  targets.  It 
builds on the recommendations of the 2008 Electra report4 and connects them with ongoing 
and  planned  EU  policies.  It  also  takes  account  of  the  European  Economic  Recovery  Plan5 
geared to short-term business survival and job preservation in Europe.  

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Doc 10082/09. 
For the products covered, see: http://ec.europa.eu/enterprise/electr_equipment/electrareport_annex1.pdf. 

http://epp.eurostat.ec.europa.eu/portal/page?_pageid=0,1136217,0_45571467&_dad=portal&_

schema=PORTAL. 
http://ec.europa.eu/enterprise/electr_equipment/electra.htm. The ELECTRA report was drafted with the 
assistance of the European Commission but does not necessarily reflect the opinion of the Commission. 
COM (2008) 800. 

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2. 

TURNING CHALLENGES INTO OPPORTUNITES  

2.1. 

Research, development and innovation 

The  EEI  lacks  access  to  RTD/innovation  and  its  financing.  A  major  reason  for  this  is  its 
strong SME nature. Financial markets and institutions tend to be cautious about investing in 
RTD projects, in particular where SMEs are concerned. There are a number of EU schemes 
supporting  RTD/innovation,  although  they  need  to  be  better  synchronised6  and  coordinated 
from both supply and demand perspectives. 

Partners  in  the  Enterprise  Europe  Network7  and  cluster  organisations8  need  to  improve  and 
professionalise their support services and better integrate innovative SMEs. Clusters generally 
meet  EEI  needs  because  they  provide  or  channel  sector-specific  and  customised  business 
support  services.9  This  includes  facilitating  cooperation  between  SMEs  and  research 
institutes,  promoting  IPR10  and  technology  transfer.  Such  services  should  reflect  the 
Commission  Recommendation  on  the  management  of  intellectual  property  in  knowledge 
transfer  activities  and  the  Code  of  Practice  for  universities  and  other  public  research 
organisations11.  EEI  businesses  themselves  need  to  become  more  proactive  in  supporting 
cluster initiatives and joining clusters. 

Research  and  innovation  may  also  be  stimulated  by  fiscal  instruments,  for  example  through 
tax  incentives  or  innovation  vouchers,  and  by  improving  the  conditions  for  risk  capital 
investment, for instance for business angels or cross-border venture capital. 

Concerns  about  the  innovation  capacity  were  key  in  selecting  EEI  in  the  framework  of  the 
product  market  and  sector  monitoring.  An  ongoing  investigation  aims  to  identify 
shortcomings by exemplary case studies and also to analyse these from a broader perspective. 
The  investigation  will  assess  how  innovation  can  be  improved  to  overcome  existing 
shortcomings12. 

European Technology Platforms (ETPs) serve as a valuable indicator of technological trends, 
enhancing  research  activities  with  a  high  degree  of  industrial  relevance  and  defining 
technology  road  maps.  Single  ETPs  address  the  needs  and  challenges  of  their  technology 
areas and are expected to be successful there at a precompetitive (early development) stage. A 
number of them are particularly relevant to the EEI.13 

The  Strategic  Energy  Technology  (SET)  Plan14  aims  to  speed  up  research  on  and 
demonstration  and  deployment  of  low  carbon  technologies  through  cooperation  between 
industry,  research  bodies  and  government.  It  provides  a  framework  for  carbon  capture  and 
storage  and  other  key  EU  technology  challenges  with  a  view  to  meeting  the  EU  climate 
change  targets  for  2020.  Many  of  the  proposals  relate  directly  to  EEI  equipment  and 
technologies. 

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Mini-study on ‘Synergies between EU instruments supporting innovation’, June 2008. 
http://www.enterprise-europe-network.ec.europa.eu/index_en.htm. 
COM(2008)652. 
Europe INNOVATM initiative: http://www.europe-innova.org/index.jsp. 
http://www.ipr-helpdesk.org/. 
C(2008) 1329. 
http://ec.europa.eu/economy_finance/publications/publication13083_en.pdf. 
For the list, see: http://cordis.europa.eu/technology-platforms/individual_en.html. 
COM(2007) 723. 

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The  European  Economic  Recovery  Plan  includes  ‘smart  investment’  in  research  to  support 
innovation in the manufacturing, construction and automotive sectors, which are particularly 
affected by the crisis and face significant challenges in the transition to the green economy. 
Three  public-private  partnerships  worth  a  total  of  more  than  €3.2  bn  are  being  set  up  to 
promote  public  interest  with  industrial  commitment  and  leadership  in  determining  strategic 
research activities in these three sectors. The EEI should benefit as it produces many of the 
technologies in question. 

2.2. 

The need to supply and maintain skills 

A  serious  problem  which  hampers 
its 
RTD/innovation  performance,  is  the  shortage  of  engineers  and  other  high-skilled  personnel 
designing and producing advanced technologies. This has to be redressed in order to maintain 
the EU’s technological leadership. 

the  EEI,  particularly 

the  development  of 

In the short term, Member States need to set up or intensify training schemes or scholarships 
to ensure that workers’ skills are not lost in the economic crisis but upgraded in anticipation 
of economic recovery. The future competitiveness of the engineering sector and its ability to 
provide  technologies  relevant  to  the  EU’s  climate  change  objectives  will  depend  largely  on 
how the crisis affects its existing workforce. 

In  the  long  term,  the  challenge  for  the  industry,  social  partners,  national  authorities  and 
education  and  training  systems15,  preferably  in  cooperation,  is  to  ensure  a  supply  of  highly 
qualified  and  well-educated  workers  with  the  right  combination  of  theoretical  and  practical 
skills16.  

To  this  end,  the  EU  is  promoting  various  policies  including  the  New  Skills  for  New  Jobs 
initiative17,  flexicurity18,  lifelong  learning19  and  e-skills20.  It  is  currently  exploring  the 
feasibility of setting up Europe- and sector-wide skills and employment councils to provide a 
platform  for  information  sharing  and  exchange  of  good  practice  between  the  sector's 
stakeholders, national authorities and those responsible for education and vocational training. 
The  challenge  of  ensuring  a  highly  educated  workforce  is  also  recognised  by  the  European 
social partners. The Commission will promote EU sectoral social dialogue as a tool of good 
governance also in the EEI sector to contribute to fostering skills development and improving 
skill matching. Other sectors with similar challenges such as the European gas and electricity 
sectors can share positive experiences in this respect. 

Persisting barriers to mobility within the EU, in particular for researchers and highly skilled 
people,  are  being  tackled  inter  alia  through  the  recently  launched  European  Partnership  for 
Researchers as part of the European Research Area (ERA). The ERA enables Europe to speak 
with  a  consistent  voice  in  international  fora  and  with  its  main  international  partners.  Public 
authorities at all levels jointly promote consistency between their R&D cooperation activities 
and develop joint initiatives that give Europe leadership in addressing global challenges and 

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COM(2008) 865. 
http://ec.europa.eu/social/main.jsp?langId=en&catId=89&newsId=529&furtherNews=yes. 
COM(2008) 868. 
http://ec.europa.eu/social/main.jsp?catId=102&langId=en  
http://ec.europa.eu/education/index_en.htm. 
COM(2007) 496; http://ec.europa.eu/enterprise/sectors/ict/e-skills/index_en.htm. 

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reaching sustainable development goals21. In this context, the lack of EU-wide recognition of 
engineers’ qualifications is still an unsolved problem. 

Another important measure is the ‘Blue card’ Directive22 aiming to respond to fluctuating EU 
labour  market  needs  by  creating  a  fast-track  and  flexible  procedure  for  admitting  highly 
qualified specialists from outside the EU. 

2.3. 

Tackling climate change and energy efficiency  

The  EEI  is  a  key  producer  of  efficient  and  environmentally  friendly  technologies. 
Contributing substantially to meeting the 2020 climate change targets provides an opportunity 
to boost its future competitiveness and its worldwide technological leadership23. The best way 
is  to  target  energy  efficiency  across  all  market  segments,  making  full  use  of  technologies 
which  are  already  available.  Today  the  direct  use  of  electricity  in  buildings,  industry  and 
transport  accounts  for  up  to  23 %  of  the  EU’s  total  energy  consumption24.  The  full  energy-
saving  potential  up  to  2020  (compared  with  2005)  ranges  between  25 %  and  30 %25.  Since 
around 80 % of currently installed energy-using products will still be in place in 202026, it is 
not  enough  to  replace  products  at  their  end  of  life  with  more  efficient  models:  the  products 
now in use must be upgraded to use more energy-efficient techniques.  

The  four  main  markets  where  EEI  technologies  can  already  impact  on  energy  supply  and 
demand are:  

•  power supply  

•  industrial applications 

•  transport  

•  buildings.  

It  is  mainly  up  to  the  industry  to  develop  and  improve  products  and  processes  to  trigger 
market take-up, but public authorities need to provide the appropriate framework: removing 
regulatory obstacles, raising awareness, mobilising financial assets and instruments, activating 
market  forces  and  fostering  technology  development,  research  and  innovation.  Despite  the 
current economic crisis the public and private sector investment needed to achieve substantial 
energy savings will have to be given high priority.  

The EU Emission Trading System (ETS)27 to reduce greenhouse gas emissions can boost the 
competitiveness  of  EEI  as  a  producer  of  technologies  limiting  CO2  emissions.  Sustainable 
ETS programming can contribute to achieving CO2 reduction, technology pull, creating more 
jobs  and  avoiding  ‘production  leakage’  in  the  EU  and  ‘carbon  leakage’  outside  the  EU. 

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http://ec.europa.eu/research/era/index_en.html. 
Council Directive 2009/50/EC of 25 May 2009, OJ L 155, 18.06.2009. 
http://ec.europa.eu/enterprise/electr_equipment/electrareport_annex3.pdf  –  market  values  for  energy 
supply and automation would increase from €22 bn and €58 bn to €34 bn and €84 bn respectively from 
2005 to 2020. 
COM (2005) 265. 
COM(2006) 545. 
http://ec.europa.eu/enterprise/electr_equipment/electrareport.pdf. 
Doc 17271/1/08 — Presidency Conclusions December 2008. 

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Moreover, from 2013 onwards, State revenues from the ETS — if directly used, in line with 
the  State  aid  rules  —  might  be  a  major  source  of  co-financing  for  the  highest-impact 
investments, which would also limit the risk of relocation of CO2 emitters. 

2.3.1. 

Power generation, transmission and distribution  

Fossil-fuel  plants  are  the  major  power  generators  in  the  EU-27,  with  53.6 %  of  gross 
electricity  generation  in  200628.  However,  the  efficiency  of  electricity  generation  by  these 
plants averages less than 40 %29. Almost 60 % is lost in generation and a further 5 % to 10 % 
in transmission and distribution, so only 30 % reaches customers as final available electrical 
energy30.  Focusing  on  improving  average  efficiency  in  power  generation  by  means  of 
equipment upgrade can raise the average from 40 % to 60 % and, if combined heat and power 
technologies are used31, even up to 85 %32. If proven successful, such power plants could be in 
demand internationally, particularly in emerging economies like China, India and Brazil. As 
such equipment is usually installed for at least 20-30 years, timing is crucial to achieving the 
intended results. 

Renewable sources of energy are increasingly seen as alternatives to fossil fuels. Their growth 
could  drive  EEI  and  have  an  effect  on  grid  stability,  but  would  require  the  development  of 
dynamic energy storage on a large scale. The directive on the promotion of the use of energy 
from renewable sources33 is expected to help speed up market absorption of technologies in 
question.  

To adapt to using decentralised renewable sources and to improve efficiency more generally 
power grids in the EU need to be modernised34. Maintaining and improving reliable, efficient 
grids,  vital  for  a  modern  society  and  for  the  EU’s  energy  security,  will  require  substantial 
investment35  in  smart  metering  and  smart  grids  so  as  to  manage  space-  and  time-varying 
sources of energy.  

Member States should accelerate the granting of approvals and permits for large infrastructure 
investment and coordinate such processes where cross-border connections are planned.  

Energy  transport  losses  can  be  reduced  by  converting  to  direct  current  for  long-distance 
transport,  to  replace  alternating  current,  which  is  more  suitable  for  shorter  links.  Direct 
current is particularly suitable if production centres are far from consumption centres and for 
underwater  operations,  for  instance  to  connect  offshore  wind  parks  to  onshore  networks. 
Where  the  industry  is  unable  to  agree  on  self-regulation,  the  Commission  is  considering 
proposing implementing measures for certain products with high energy consumption used for 
infrastructure under the EuP Directive36. In this context, the Commission is investigating the 
scope for introducing requirements for transformers and related equipment. 

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http://ec.europa.eu/energy/publications/doc/statistics/part_2_energy_pocket_book_2009.pdf p.30. 
‘Energy Technology Perspectives 2008’ of the International Energy Agency. 
‘Energy Technology Perspectives 2008’ of the International Energy Agency. 
Directives 2004/8/EC and 2007/74/EC. 
‘Energy Technology Perspectives 2008’ of the International Energy Agency. 
Directive  2009/28/EC  of  the  European  Parliament  and  of  the  Council  of  23  April  2009,  OJ  L  140, 
5.6.2009, p. 16–62. 
The current grid system is primarily built for the distribution of electrical power in one direction. 
http://ec.europa.eu/enterprise/electr_equipment/electrareport_annex2.pdf. 
Directive 2005/32/EC on the eco-design of Energy-using Products (EuP); OJ L 121, 22.7.2005. 

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lines  have 

triggered  public  concern  about  exposure 

Overhead 
low  frequency 
electromagnetic fields and environmental debate. Deployment of underground cables could be 
one  solution  in  some  cases37  but  it  is  not  widespread.  It  should  be  an  integral  part  of  the 
European  transport  networks  strategy,  thus  creating  synergies  and  reducing  costs  and 
timescales38.  Environmental  concerns,  linked  to  ‘Natura’  (nature  conservation)  legislation, 
will also have to be taken into account. 

to 

Generally, in electricity generation, transmission and distribution, market forces in the EU are 
still  too  weak  and  regulatory  barriers  persist.  A  prerequisite  for  more  competition  in  the 
electricity market is a fully liberalised internal energy market. 

2.3.2. 

Industrial applications 

Industry  consumes  30 %  of  the  final  energy  demand  in  the  EU39.  By  changing  certain 
production processes, savings of 30 % and even up to 65 % can be obtained40. To fully explore 
the  overall  saving  potential,  EU  industry  as  a  whole  needs  to  regard  investing  in  energy-
efficient  applications  as  a  strategic  management  decision,  by  using  for  instance  the  ISO 
energy management model41. 

High energy savings can be achieved in two main production processes: 

–  Electric  motors  use  up  to  70 %  of  the  electricity  consumed  in  industrial  applications  and 
half  of  them  could  be  retrofitted  with  variable  speed  drives,  yielding  significant  energy 
savings up to 50 %. Moreover, only about 12 % of them are electronically controlled. An 
implementing  measure  of  July  200942  under  the  EuP  Directive,  aiming  at  improving  the 
energy and environmental performance of electric motors, will be a key element.  

–  Most  of  the  waste  heat  from  industrial  processes  could  be  recovered  and  used  for  local 

power generation by steam turbines.  

In addition, EU industry as a whole could improve its energy efficiency by making optimum 
use  of  low-consumption,  high-efficiency  loads  such  as  lighting  systems,  motors,  power 
capacitors, transformers and cables through appropriate automation and controls. Procedures 
and tools to monitor performance and maintain systems are also important in this regard. 

2.3.3. 

Transport 

The  transport  sector  accounts  for  around  30 %  of  final  energy  demand43  in  the  EU.  The 
potential  energy  savings  are  considerable:  approximately  26 %  by  2020  compared  with 
200544. Optimisation of transport logistics and traffic management can provide major energy 
efficiency gains. Innovative EEI technologies help to save energy and reduce CO2 emissions.  

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Underground  electricity  networks  have  limitations  in  replacing  overhead  lines,  in  particular  because 
they have a large capacitive load that must be compensated about every 50 km. 
COM(2007) 135. 
COM(2005) 265. 
http://ec.europa.eu/enterprise/electr_equipment/electra.htm. 
http://www.iso.org/iso/pressrelease.htm?refid=Ref1122. 
Commission Regulation (EC) No 640/2009. 
Green Paper on energy efficiency. 
COM(2006) 545. 

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Member States’ recovery plans to mitigate the effects of the crisis for the car industry45 have 
an  impact  not  only  on  energy  saving  and  CO2  emissions,  but  also  on  related  employment 
within the EEI. 

The Green Cars Initiative in the European Recovery Plan offers an opportunity to act both on 
vehicle  technologies  and  on  distribution  infrastructure  and  energy  supply.  It  is  a  set  of 
measures targeted at the crisis in the European automotive sector. Its main pillar concerns the 
electrification  of  road  and  urban  transport,  including  different  types  of  research  activities 
supported by ETPs like ERTRAC (European Road Transport Research Advisory Council) and 
EPoSS  (European  Technology  Platform  on  Smart  Systems  Integration).  The  Initiative 
involves  EIB  loans  to  car  producers  and  suppliers  to  finance  innovation  and  FP7  research 
funding  in  public-private  partnerships  (for  total  research  efforts  of  €1  bn);  some  Member 
States  have  also  introduced  demand-side  measures  to  boost  the  uptake  of  new  vehicles  and 
help scrap older vehicles. 

Given  the  importance  of  reducing  carbon  emissions  from  road  transport,  and  the  price  and 
security  of  oil  supply,  electric  cars  may  well  be  an  alternative  to  traditional  internal 
combustion engines using fossil fuels. In the long-term mass production of electric cars will 
help car manufacturers to achieve Community CO2 emissions targets for passenger cars46 and 
will  contribute  to  the  overall  aim  of  reducing  CO2  emissions  —  provided  that  electricity  is 
generated  from  renewable  or  low-carbon  sources.  Besides  low  greenhouse-gas  emissions, 
these  vehicles  have  no  pollutant  tailpipe  emissions  such  as  particulates  and  nitrogen  oxides 
and produce only low noise. Electric vehicles could potentially be used to store energy in a 
distributed energy system and may thus contribute to eliminating peak loads in the network. 
According  to  the  CARS21  mid-term  report47,  in  the  short  to  medium  term,  hybrid 
technologies (hybrids and plug-in hybrids) are likely to be used alongside internal combustion 
engines.  For  the  medium  to  longer  term,  fully  electric  vehicles  and  hydrogen-powered 
vehicles  are  the  most  promising  options.  However,  strong  efforts  to  make  electric  cars  a 
commercially  viable  option  are  still  necessary.  A  significant  barrier  is  the  cost  of  electric 
vehicles related to the cost of high power-density batteries, the continuous R&D investment 
and  small  economies  of  scale  at  the  early  stages  of  market  introduction.  The  short  driving 
range and scarce charging infrastructure are practical problems for consumers. Finally, there 
is a need to ensure the proper functioning of the internal market of electric vehicles through 
the adoption of harmonised approval requirements.  

2.3.4. 

Buildings 

Commercial,  public  and  residential  buildings  account  for  some  40 %  of  total  final  energy 
demand, of which more than 27 % is in the form of electricity48. The potential energy savings 
could be up to 30 % by 2020 compared with 200549. Most of this energy is used for heating 
(boilers,  water  heaters)  and  lighting.  The  energy  efficiency  of  lighting  is  covered  by  two 
measures50  under  the  EuP  Directive,  and  new  rules  on  minimum  energy  efficiency  and 
labelling for boilers and water heaters should be adopted over the coming months. Public and 

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http://ec.europa.eu/enterprise/automotive/pagesbackground/competitiveness/index.htm. 
In  line  with  the  Regulation  (EC)  No  443/2009  setting  emission  performance  standards  for  new 
passenger  cars  as  part  of  the  Community’s  integrated  approach  to  reduce  CO2  emissions  from  light-
duty vehicles. Please see: http://ec.europa.eu/environment/air/transport/co2/co2_home.htm. 
CARS 21 Mid-Term Review High Level Conference — Conclusions and Report. 
Green Paper on energy efficiency. 
COM(2006) 545. 
Commission Regulation (EC) No 244/2009 and Commission Regulation (EC) No 245/2009. 

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private  lighting  equipment  and  systems  consume  20 %  of  total  final  demand  for  electricity. 
Lighting  industries  have  an  energy-saving  potential  of  between  30 %  and  65 %51.  Modern 
technologies  like  light-emitting  diodes  (LED)  could  save  30 %  of  today’s  consumption  by 
2015 and up to 50 % by 202552. 

Energy  management  systems  can  greatly  reduce  the  CO2  footprint  of  buildings.  The  key 
challenge is to devise solutions that cover current buildings, as up to 80 % of them will still be 
in use in 2020. Return on investment will be a key point for owners and their tenants. Often 
the investor is not the user of the building, which means that the initial expense may matter 
more to him than energy efficiency over the building’s lifetime. Education of professionals in 
the sector, information for customers, incentives to renovate and insulate private buildings, a 
commitment on the part of governments to improve the energy efficiency of publicly owned 
buildings, and regulation or codes are all needed. In this respect, the Energy Performance of 
Buildings  Directive  (EPBD)  and  its  revision  is  a  key  Community  instrument  for  addressing 
the energy efficiency of buildings. 

Results could be achieved with high-efficiency and flexible products and systems (domestic 
appliances,  heating,  ventilation,  etc.),  optimisation  of  transformer  loads  and  variable-speed 
drives,  presence  detection  to  activate  pumps  and  ventilators  in  shopping  centres,  and 
automation  and  control  systems.  These  not  only  optimise  technical  building  systems  while 
saving energy, but also increase safety and security. Awareness-raising, training programmes, 
public procurement and tax measures promoting the best-performing products will contribute 
to these ends53. Existing buildings offer the most scope for improvement but also entail weak 
points, like safety. The Commission will launch a study to assess how to improve the safety of 
electrical installations in buildings while at the same time increasing their energy efficiency 
and enabling safe integration of renewable energy sources and new services like charging of 
electric vehicles.  

In the current crisis, Member States’ investments in upgrading the energy efficiency of public 
buildings  such  as  offices,  hospitals  and  schools  deserve  higher  priority.  So  far,  Member 
States’ measures to support energy-efficiency investment, in particular focusing on reducing 
the energy consumption of buildings, amounts to a fiscal stimulus of around €20bn, or 0.16  % 
of EU GDP, over 2009-1054. 

2.4. 

Coping with societal needs — growth markets 

Current and future needs of EU citizens derive inter alia from demographic changes due to an 
ageing  society,  necessitating  reliable  and  quick  healthcare  systems,  building  infrastructures 
that  allow  intelligent  living/ambient  assisted  living  and  a  greater  emphasis  on  security.  The 
EEI  thus  has  wide  scope  to  develop  innovative  technologies  for  future  infrastructure  and 
applications to cope with these societal needs within quite a short time. 

The  following  applications  help  to  meet  these  needs,  have  a  strong  technological  and 
industrial base in Europe and depend more than other markets on the creation of favourable 
framework conditions through specific public policy measures. 

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French Agency for the Environment and Energy Management. 
COM(2008) 241. 
COM(2008) 660. 
http://ec.europa.eu/economy_finance/publications/publication15666_en.pdf p.57-63 and p.72. 

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Electromedical products 

There  is  increasing  demand  for  good  healthcare  and  advanced  treatments.  E-health  systems 
will be important because they allow better information sharing among professionals and with 
patients, thereby creating more ‘patient-friendly’ healthcare services. By developing  new E-
health  systems,  the  EEI  will  not  only  help  patients,  but  will  also  create  strong  competitive 
assets  on  a  global  scale.  The  Commission  is  determined  to  encourage  new  E-health 
communication systems, e.g. through standardised solutions.  

Buildings for intelligent living and ambient assisted living 

This  market  will  be  driven  both  by  increasing  energy  costs  and  by  the  increase  in  single 
person  households  and  working  from  home.  These  factors  will  trigger  developments  in 
technologies  such  as  interoperable  remote  access  and  control  and  ‘greener  buildings’, 
including both passive and active energy-efficient technologies. 

Security 

The  EU  is  facing  increasing  security  threats  in  the  form  of  terrorist  attacks  and  illegal 
migration. The EU EEI can contribute to this end being a producer of the technical solutions 
required55  in  order  to  enhance  security,  for  citizens,  infrastructure  and  utilities,  at  the  EU’s 
borders, and within the framework of crisis management56.  

2.5. 

Internal Market and standardisation 

The internal market system, with its uniform regulatory approach, greatly facilitates the free 
movement  of  electrical  appliances.  The  recent  measures  to  create  a  New  Legislative 
Framework (NLF) for EU harmonisation legislation for products should make it much easier 
for the EEI and others to market their products. As part of this process, by the end of 2010 the 
Commission  will  draft  a  proposal  on  the  obligations  of  economic  operators  and  the  role  of 
notified  bodies,  intended  to  make  the  relevant  legislation  more  coherent.  Another  NLF 
component,  the  Regulation  on  Accreditation  and  Market  Surveillance  (RAMS),  Regulation 
765/2008, which comes into effect on 1 January 2010, should strengthen market surveillance 
systems for products. These measures should also reinforce the credibility of CE marking. 

Standardisation  is  a  prerequisite  for  workable  EU  rules  for  electrical  products.  Voluntary 
standards  and  technical  specifications  supplement  the  requirements  of  EU  law.  With  the 
assistance  of  the  European  Standards  Organisations  (ESOs),  including  CENELEC57,  new 
technologies  are  spread  through  the  implementation  of  electrotechnical  standards,  providing 
open access to innovation. 

The  ESOs  must  continue  to  produce  the  standards  necessary  to  facilitate  market  take-up  of 
energy-efficient  and  environmentally  friendly  systems  and  products,  in  particular  electrical, 
electronic, mechanical and ICT equipment. To this end, they must deepen the integration of 
environmental and energy efficiency aspects in the standardisation process58 and set priorities 

55 
56 
57 
58 

http://ec.europa.eu/enterprise/electr_equipment/electrareport_annex3.pdf. 
See also COM(2009)149 on Critical Information Infrastructure Protection. 
http://www.cenelec.eu. 
Communication ‘Integration of Environmental Aspects into European Standardisation’ COM(2004) 130 
final. 

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in related work programmes and mandates. Standardisation activities also need to become a 
more integral part of RTD projects under the framework programmes.  

3. 

CONCLUSIONS & FOLLOW-UP 

This Communication identifies areas with growth potential to which the EEI can significantly 
contribute. In particular, EU climate and energy policies should be seen as an opportunity for 
the  EEI  to  develop  new  businesses,  new  industries  and  new  jobs,  especially  in  times  of 
recession.  Full  implementation  of  the  measures  outlined  below  should  encourage  long-term 
investment  in  energy  infrastructure  and  ensure  high-skilled  human  capital,  thus  reinforcing 
the EU’s technological base.  

It  should  also  be  noted  that  as  part  of  the  Lisbon  agenda  the  Commission  is  carrying  out 
product market and sector monitoring as a follow-up to the Single Market Review59 including 
radio, TV and communication equipment and major household appliances, and the retail sale 
of electrical household appliances, radio and television sets. The EEI was selected for this in-
depth sector investigation, as one of the sectors with problems in terms of market functioning 
and which are also either economically important or important for improving the adjustment 
capacity of the EU economy. Final results of this work are expected by the end of 2009. 

The following specific actions need to be taken: 

Industry should: 

(1) 

(2) 

(3) 

(4) 

step up its R&D efforts, for example to improve the energy efficiency of equipment in 
electricity grids and power plants, notably those that are fossil fuelled. 

invest in automation and ICT within industrial applications.  

go for voluntary agreements on the energy performance of products, where such action 
is likely to deliver policy objectives faster or in a less costly manner than mandatory 
requirements without conflicting with EU law. 

develop harmonisation in intelligent home control systems, including smart metering 
systems,  allowing  networking  of  household  appliances  and  better  management  of 
electrical  loads  along  with  better  temperature  control.  A  good  example  is  the  ‘smart 
home’ project60 supported by the Commission.  

Utilities are encouraged to: 

(5) 

proactively  upgrade  electricity  grids  allowing  integration  of  a  varied  portfolio  of 
electricity generation including centralised and decentralised sources61, and equipment 
in  power  plants  to  reduce  primary  energy  demand  and  CO2  emissions,  in  order  to 
ensure a proper functioning of the internal energy market and security of supply. 

59 
60 
61 

http://ec.europa.eu/citizens_agenda/docs/sec_2007_1517_en.pdf  
http://www.smartenergyhome.eu/. 
COM(2008) 241 and the updated Strategic Energy Review. 

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Member States are invited to: 

(6) 

(7) 

facilitate  new  trans-national  energy  connections  which  allow  better  use  of  existing 
capacity  on  the  basis  of  industry  responsibility  and  concepts.  Attention  should  be 
given to the deployment of underground power cable systems. 

foster  solutions  that  boost  consumer  take-up  of  energy-saving  technologies  for 
existing  and  new  buildings,  including  incentives  for  consumers  to  replace  their  old 
appliances with more efficient ones. 

(8) 

ensure that products put on the market comply with the applicable legislation. 

The Commission will: 

(9) 

(10) 

(11) 

assess,  in  cooperation  with  the  ESOs,  the  need  for  standardisation  work  to  cover 
EPBD requirements and to help implement other legislation on energy efficiency like 
the  Eco-design  Directive,  the  Energy  Labelling  Directive  and  the  Eco-Label 
Regulation. 

continue  to  support  the  ISO  energy  management  model62,  which  will  provide 
organisations and companies with a widely recognised framework for building energy 
efficiency into their management practices.  

launch  a  study  to  assess  how  to  improve  the  safety  of  electrical  installations  in 
buildings while at the same time increasing their energy efficiency and enabling safe 
integration of renewable energy sources and other new applications. 

The  Commission  will  closely  monitor  these  actions,  measures  and  impacts,  in  cooperation 
with  stakeholders,  who  should  report  on  progress  in  their  implementation.  In  line  with  the 
conclusions of the May 2009 Competitiveness Council, the Commission will report in 2012 
on the implementation of the proposed measures. 

62 

http://www.iso.org/iso/pressrelease.htm?refid=Ref1122. 

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Annex I 
EEI-relevant EU policy initiatives 

The most relevant EU policies for the EEI are: 

•  The  climate  and  energy  package,  including  the  emission  trading  system  (EU  ETS)  and 

Directive 2009/31/EC on the geological storage of carbon dioxide63. 

•  The internal market in electricity64, the Communication ‘An energy policy for Europe’65, 
Decision  1364/2006/EC  laying  down  a  series  of  TEN-E  (Trans-European  Networks-
Energy) guidelines and the Green Paper on TEN-E66 as part of the Second Strategic Energy 
Review67 presented in November 2008. 

•  The  ‘Sustainable  Consumption  and  Production  (SCP)  and  Sustainable  Industrial  Policy 
(SIP) Action Plan’68, which aims to improve the energy and environmental performance of 
products,  with  incentives  (e.g.  public  procurement  or  tax  measures)  to  promote  the  best-
performing products. 

•  The  Ecodesign  of  Energy-using  Products  (EuP)  Directive69,  which  has  given  rise  to  a 
number of implementing measures for certain products. The SCP/SIP Action Plan contains 
proposals for extending the scope of the EuP Directive, revising the Ecolabel Regulation 
and  revising 
the  EU  Eco-Management  and  Audit  Scheme  Regulation,  plus  a 
Communication on Green Public Procurement.  

•  The Energy Efficiency Action Plan (EEAP)70, which incorporates 85 legislative and other 
measures to be implemented from 2007 to 2012, covering products, appliances, buildings, 
transport,  energy  conversion,  financing,  incentives,  etc.  The  EEAP  will  be  reviewed  in 
2009.  In  November  2008,  the  Commission  adopted  a  Communication  on  energy 
efficiency71  together  with  proposals  for  revising  the  Energy  Labelling  Directive  and  for 
recasting the Energy Performance of Buildings Directive. 

•  The  second  Strategic  Energy  Review72,  adopted  in  November  2008,  which  updates  and 

elaborates on solutions applicable to the EEI and other industries. 

•  The Environmental Technologies Action Plan (ETAP)73, which deals with eco-friendly and 
advanced  environmental  technologies  and  products  to  be  used  in  investment  and 
purchasing decisions. It also provides for financing facilities. 

•  The  Cohesion  Policy  for  2007-2013,  under  which  Member  States  may  provide  financial 
support  for  the  EEI  as  suggested  in  this  Communication.  The  Community  Strategic 

63 
64 
65 
66 
67 
68 
69 
70 
71 
72 
73 

OJ L 140, 5.6.2009. 
COM(2007) 528. 
COM(2007) 1. 
COM(2008) 782. 
http://ec.europa.eu/energy/strategies/2008/2008_11_ser2_en.htm. 
COM(2008) 397. 
2005/32/EC. 
COM(2006) 545. 
COM(2008) 772. 
http://ec.europa.eu/energy/strategies/2008/2008_11_ser2_en.htm. 
COM(2004) 38. 

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Guidelines give priority to innovation, support for SMEs and sustainable development. In 
response to the financial and economic crisis, the Cohesion Policy allows Member States 
to accelerate and increase support for low carbon services and technologies.74
 For example, 
a  proposed  amendment  to  the  ERDF  Regulation allows  Member  States  to  dedicate  up  to 
4 % of their total ERDF allocation to energy efficiency and renewable energy investments 
in housing. 

•  The Proposal for a Directive on industrial emissions (IPPC)75, which recasts seven existing 
Directives into a single clear and coherent legislative instrument. It will lead to significant 
benefits  for  the  environment  and  human  health  by  reducing  harmful  industrial  emissions 
across the EU, in particular through better application of Best Available Techniques. 

•  The ongoing feasibility study on the setup of sectoral councils on employment and skills at 
European level which could potentially lead to the creation of such councils for the EEI if 
the sector’s representatives support such initiative. 

74 
75 

COM(2008) 876 ‘Cohesion policy: investing in the real economy’. 
COM(2007)843 final. 

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Annex II 
EU funding for EEI activities 

The  following  instruments  are  potential  sources  of  grants,  loans,  loan  guarantees,  venture 
capital, private equity, technical assistance, interest rate subsidies or risk capital. 

•  The Cohesion Policy Funds — For the period 2007-2013, Member States plan to use more 
than  €10  billion  from  these  Funds  to  support  sustainable  energy  projects,  for  example, 
infrastructure,  co-generation,  renewable  energies,  energy  efficiency  and  training  and 
services  including  energy  performance  audits.  This  amount  will  be  complemented  with 
national public and in some cases private funding that can approximately double it. 

Beyond this, Cohesion Policy provides the largest EU support for SMEs, some €55 billion, 
which  covers  access  to  capital,  advanced  business  services,  start-ups,  cluster  initiatives, 
measures to stimulate RTD, eco-technologies and processes, etc. This amount is also to be 
topped up by national public and private capital. 

•  The 7th Framework Programme for RTD76 — €2.35 billion over the period 2007-2013 for 
non-nuclear  energy,  such  as  renewable  energy  generation,  CO2  capture  and  storage 
technologies,  clean  coal  technologies,  smart  energy  networks,  energy  efficiency  and 
savings and knowledge for energy policy-making.  

•  The Competitiveness and Innovation Programme (CIP)77 — €700 million in its operational 
programme  Intelligent  Energy  Europe  over  the  period  2007-2013  is  reserved  for  support 
for measures in the areas of low carbon energy, innovative technologies, energy efficiency 
and  renewable  energy  sources,  rational  use  of  energy  resources  and  energy-specific 
legislation. 

•  The  Trans-European  Energy  Networks  TEN-E78  —  €155  million  over  the  period  2007-

2013  to  help  promote  interconnection  and  interoperability  of  electricity  and  gas 
infrastructures.  

•  The Common Agricultural Policy79 — €3 billion for climate-friendly investments in rural 
development, like perennial energy crops, bio-energy plants, improving energy efficiency 
in machinery or renewable energy sources for on-farm or local use80. 

•  The  European  Social  Fund81  for  capacity  building  and  vocational  training  to  limit  skill 

shortages in energy-efficient and environmentally friendly technologies. 

Additional sources that can be used: 

•  Many Member States offer incentives for consumers to buy energy-efficient products such 
as vouchers for purchasers or personal income tax relief. When such incentives are granted 
without discrimination based on the origin of the product, they generally do not constitute 
State aid. State aid supporting environmentally friendly technologies or energy saving may 

76 
77 
78 
79 
80 
81 

http://cordis.europa.eu/fp7/home_en.html. 
http://ec.europa.eu/cip/index_en.htm.; http://ec.europa.eu/energy/intelligent/index_en.html. 
Decision 1364/2006/EC. 
http://ec.europa.eu/agriculture/bioenergy/index_en.htm. 
Regulations (EC) No 1698/2005 and No 1974/2006. 
http://ec.europa.eu/employment_social/esf/index_en.htm. 

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be  allowed  under  the  conditions  stipulated  in  the  Community  guidelines  on  State  aid  for 
environmental protection82, adopted as part of the Climate Package in January 2008. State 
aid to support RTD/Innovation projects, clusters, innovation actions, and the loan of highly 
qualified  staff  can  be  granted  to  SMEs  and  to  large  enterprises  under  the  conditions 
stipulated in the Community Framework for State Aid for Research and Development and 
Innovation.83 

•  The  General  Block  Exemption  Regulation  (‘GBER’)84  offers  wide  scope  for  Member 
States to grant aid in support of environmental protection easily and immediately without 
notifying the Commission. 

•  A  concise  summary  of  the  legislation  on  the  possibilities  to  support  SMEs,  not  only  for 
environmental  protection  but  also,  for  example,  for  boosting  RTD/Innovation  activities, 
clusters  or  risk  capital  measures,  is  presented  in  the  ‘Handbook  on  Community  state  aid 
rules for SMEs’.85 

•  Guarantees are another form of State aid to encourage private financing.86  

•  On  17  December  2008,  the  Commission  adopted  a  temporary  framework  for  State  aid 
authorising  Member  States  to  ease  access  to  finance  for  companies  through  subsidised 
guarantees and loan subsidies for investments in products going beyond EU environmental 
standards. It promotes clean technologies and energy efficiency.87  

82 
83 

84 

85 
86 
87 

http://ec.europa.eu/comm/competition/state_aid/legislation/horizontal.html. 
OJ C 323 of 30.12.2006, p. 1.  
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2006:323:0001:0026:EN:PDF. 
Commission  Regulation  (EC)  No  800/2008  of  6  August  2008  declaring  certain  categories  of  aid 
compatible with the common market in application of Articles 87 and 88 of the Treaty (General block 
exemption Regulation), OJ L 214, 9.8.2008, p. 3. 
http://ec.europa.eu/competition/state_aid/studies_reports/sme_handbook.pdf. 
2008/C 155/02. 
COM(2008)  800  p.10,  as  amended  on  25  February  2009,  OJ  C  83,  7.4.2009.  Consolidated  version: 
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2009:083:0001:0015:EN:PDF}. 

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