COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Innovation for a sustainable Future - The Eco-innovation Action Plan (Eco-AP)
Date: 2011-12-15
Institutions: European Commission
Subjects: clean technology, innovation, international market, research and development, small and medium-sized enterprises, sustainable development

EUROPEAN COMMISSION 

Brussels, 15.12.2011 
COM(2011) 899 final 

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

Innovation for a sustainable Future - The Eco-innovation Action Plan (Eco-AP) 

(Text with EEA relevance) 

{SEC(2011) 1598 final} 
{SEC(2011) 1599 final} 
{SEC(2011) 1600 final} 

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   EN 

 
 
 
  
 
1. 

INTRODUCTION 

As  a  response  to  the  economic  and  financial  crisis,  the  Europe  20201  strategy 
reinforces the EU's capacity to deliver smart, sustainable and inclusive growth. The 
strategy’s objectives are being implemented through a number of Flagship Initiatives 
addressing the main challenges.  

The Innovation Union2 Flagship Initiative will ensure that innovative ideas are turned 
into  products  and  services  that  create  growth  and  jobs  and  address  Europe's  major 
societal  challenges.  As  a  step  in  this  direction  this  Flagship  Initiative  commits  to 
developing  an  Eco-innovation  Action  Plan  building  on  the  Innovation  Union  and 
focusing  on  the  specific  bottlenecks,  challenges  and  opportunities  for  achieving 
environmental objectives through innovation. 

The  Eco-innovation  Action  Plan  (EcoAP)  also  complements  other  Europe  2020 
Flagship  Initiatives.  A  major  building  block  for  the  transition  towards  a  green 
economy is the "Resource Efficient Europe"3 Flagship and its roadmap4, creating and 
reinforcing  demand  for  eco-innovation  and  related  investment.  .  The  "Industrial 
Policy for a Globalized Era"5 places the EcoAP as one tool to identify and implement 
measures  for  the  deployment  of  key  environmental  technologies,  to  enhance 
coordination  and  cooperation  between  the  EU  and  Member  States  and  to  generate 
awareness of the potential of new technologies. The Agenda for new Skills and Jobs6 
calls  for  the  EcoAP  to  support  competences  for  sustainable  development,  and 
promote appropriate skills development and tackle skills mismatches.  

The  EcoAP  will  therefore  focus  on  boosting  innovation  that  results  in  or  aims  at 
reducing pressures on the environment and on bridging the gap between innovation 
and the market. It will, inter alia, take further some actions identified in the Resource 
Efficiency Roadmap.  

Eco-Innovation7 is any form of innovation resulting in or aiming at significant and 
demonstrable  progress  towards  the  goal  of  sustainable  development,  through 
reducing  impacts  on  the  environment,  enhancing  resilience  to  environmental 
pressures, or achieving a more efficient and responsible use of natural resources.  

1 

2 

3 

4 
5 

6 

7 

COM(2010)  2020:  Communication  from  the  Commission  "Europe  2020:  A  strategy  for  smart, 
sustainable and inclusive growth". 
COM(2010) 546: Communication from the Commission: "Europe 2020 Flagship Initiative: Innovation 
Union". 
COM(2011)  21:  Communication  from  the  Commission:  "A  resource-efficient  Europe  –  Flagship 
Initiative under the Europe 2020 Strategy". 
COM(2011) 571 final. 
COM(2010)  614:  Communication  from  the  Commission:  "An  integrated  industrial  policy  for  the 
globalisation era: Putting competitiveness and sustainability at centre stage". 
COM(2010)  682  final:  An  Agenda  for  new  skills  and  jobs:  "A  European  contribution  towards  full 
employment". 
Adapted  from  Decision  N°  1639/2006/EC  establishing  a  Competitiveness  and  Innovation  Framework 
Programme.  

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As  part  of  the  multi-annual  financial  framework  for  2007-2013,  the  European 
Commission  is  supporting  research  and  demonstration  projects  for  eco-innovative 
technologies  and  for  their  market  penetration  within  (1)  the  7th  Framework 
Programme  for  Research  and  Technological  Development  (FP7),  (2) 
the 
Competitiveness and Innovation Framework Programme (CIP), Eco-innovation First 
Application  and  Market  Replication  Projects,  (3)  the  European  Eco-innovation 
Platform, and (4) under the Environmental Part of the LIFE+. In synergy with these 
programmes, Member States and regions can also draw on Cohesion Policy support 
for the further deployment and replication of eco-innovation. 

In  its  Communication  on  a  Budget  for  20208,  the  Commission  has  indicated  that 
research and innovation will be structured around three mutually reinforcing themes 
(1)  excellence  in  the  science  base;  (2)  tackling  societal  challenges;  (3)  creating 
industrial  leadership  and  competitive  frameworks.  The  Commission  has  also 
committed to mainstream climate action into EU spending programmes and to direct 
at least 20% of the Union's budget to climate-related objectives. 

Horizon  20209,  the  Framework  Programme  for  Research  and  Innovation  for  2014-
2020 will strengthen the role of eco-innovation and provide adequate financial means 
for the implementation of this Action Plan post-2013. In particular, actions to enable 
the transition to a green, low carbon and climate resilient economy as foreseen in the 
context  of  the  Societal  Challenge  "Climate  Action,  Resource  Efficiency  and Raw 
Materials" are of great relevance. 

The  partnering10  approach  in  research  and  innovation  will  accelerate  the  path  of 
innovative research towards market applications. 

2. 

THE ECO-INNOVATION CHALLENGE 

Eco-innovation  needs  to  be  accelerated  in  a  way  that  boosts  resource  productivity, 
efficiency, competitiveness and helps to safeguard the environment. More and more 
severe  environmental  challenges  and  resource  constraints  have  lead  to  growing 
worldwide demand for environmental technologies,  products  and  services and have 
facilitated  the  emergence  of  green  industries  (see  Annex  1).  Accelerated  market 
uptake  and  dissemination  of  eco-innovation  will  lead  to  improved  environmental 
performance and resilience across the economy being at the same time cost-effective 
and good for business and society as a whole. 

3. 

BARRIERS AND DRIVERS FOR ECO-INNOVATION IN SMES 

Eco-innovation  has  until  now  penetrated  to  the  markets  relatively  slowly,  with  the 
exception of renewable energy as a result of energy and climate policies. Bottlenecks 
to  eco-innovation  include  the  failure  of  market  prices  to  accurately  reflect 

8 
9 

10 

COM(2011) 500; A Budget for 2020- Part II: Policy fiches 
COM  (2011)  808/3  final:  Communication  from  the  Commission  on  Horizon  2020  –  The  Framework 
Programme for Research and Innovation.  
COM(2011) 572 final: Communication from the Commission: Partnering in Research and Innovation 

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environmental  costs  and  benefits,  rigid  economic  structures,  infrastructure  and 
behavioural lock-ins, and harmful incentives and subsidies. Other aspects hampering 
the spread of eco-innovation include limited knowledge and certainty of the markets. 
Although many of these barriers are similar to those faced by innovative businesses 
at large, they tend to be more severe for businesses focusing on eco-innovation. 

To address some of the barriers the European Commission launched already in 2004 
the Environmental Technologies Action Plan11 (ETAP). 

A  recent  Eurobarometer  survey  on  the  attitudes  of  European  SMEs  to  eco-
innovation12  gives  a  good  insight  into  perceived  barriers  and  drivers  for  eco-
innovation. 

Barriers to accelerated eco-innovation uptake and development for companies 

Very serious

Somewhat serious

Not serious

Not at all serious

Not applicable

DK/NA

Lack of collaboration with research institutes and universities

13

21

24

19

20

Lack of suitable business partners

Limited access to external information and knowledge, including a
lack of well-developed technology support services

16

16

25

27

Reducing material use is not an innovation priority

17

27

Market dominated by established enterprises

Lack of qualified personnel and technological capabilities within the
enterprise

Technical and technological lock-ins (e.g. old technical infrastructures)

21

23

22

29

28

29

26

22

9

9

9

19

18

17

8

20

6

26

25

23

22

20

16

9

Reducing energy use is not an innovation priority

26

29

21

Lack of external financing

31

Existing regulations and structures not providing incentives to eco-
innovate

25

26

32

19

19

Insufficient access to existing subsidies and fiscal incentives  

30

30

17

15

15

13

12

6

8

7

8

Lack of funds within the enterprise

36

Uncertain return on investment or too long a payback period for eco-
innovation

Uncertain demand from the market

32

34

27

32

17

14

5

14

11

8

33

14

11

6

0%

20%

40%

60%

80%

100%

11 

12 

COM (2004) 38 final, Communication from the Commission, Stimulating technologies for sustainable 
development: An Environmental Technologies Acton Plan for the European Union 
Flash Eurobarometer 315: Attitudes of European entrepreneurs towards eco-innovation, March 2011 

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Drivers that could accelerate eco-innovation uptake and development 

Very important

Somewhat important

Not important

Not at all important

Not applicable

DK/NA

Collaboration with research institutes, agencies and universities

19

30

21

14

Existing regulations, including standards

Limited access to materials

Expected future regulations imposing new standards

Good access to external information and knowledge, including technology
support services

Expected future material scarcity (as an incentive to develop innovative, less
material-intensive substitutes)

Increased market demand for green products

Technological and management capabilities within the enterprise

Access to existing subsidies and fiscal incentives

Secure or increase existing market share

Good business partners

Current high material prices (as an incentive to innovate to use less material
and decrease the cost)

Current high energy prices (as an incentive to innovative, to use less energy
and decrease the cost)

Expected future increases in energy prices

30

30

33

34

35

36

37

40

42

45

45

50

52

41

15

7

31

19

12

38

40

29

32

37

32

34

31

31

14

8

14

6

16

10

15

8

14

7

14

7

12

11

6

8

11

7

29

30

11

9

5

5

0%

20%

40%

60%

80%

100%

This  survey  shows  that  the  uncertain  demand  from  the  market  and  return  on 
investment are two of the main barriers, while high energy and material prices, new 
regulations and standards, and access to knowledge are among the main drivers. 

Building on the Europe 2020 Flagship Initiatives and on the ETAP lessons learnt, the 
EU can accelerate further eco-innovation with well targeted policies and actions. In 
particular,  measures  in  the  areas  of  regulatory  incentives,  private  and  public 
procurement  and  standards  and  performance  targets  can  help  create  stronger  and 
more  stable  market  demand  for  eco-innovation.  Additional  funding  must  also  be 
mobilised for investment in eco-innovation and policy measures are needed to lower 
and manage the risks for entrepreneurs and investors. 

A  long  term  strategy  on  eco-innovation,  based  on  partnering,  will  reinforce  eco-
innovation by increasing the critical mass required for innovation, exchanging ideas 
and good practice and creating networks and commercial relationships. 

4. 

ECO-INNOVATION OPPORTUNITIES AND EU ACTION  

Eco-innovation is closely linked to the way we use our natural resources and to how 
we  produce  and  consume.  The  expected  environmental,  societal  and  commercial 
benefits  of  wide-spread  adoption  of  eco-innovation  can  be  considerable.  European 
eco-industries  are  already  a  significant  economic  sector,  with  an  estimated  annual 

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 319 billion or about 2.5 % of the EU’s gross domestic product13 (GDP). 
turnover of €
In  the  past  two  years  45%  of  European  companies  operating  in  manufacturing, 
agriculture, water and food services have eco-innovated and benefited from it. 

During 2012-2013, under current EU financing framework, EcoAP will support the 
introduction  and  scaling-up  of  environmental  technologies  in  the  market,  in 
particular  by  supporting  demonstration  projects.  This  will  pave  the  way  for  more 
comprehensive follow-up actions under the EU2020 Flagship Initiatives and Horizon 
2020. 

In the medium and long-term, in 2013-2020, eco-innovation should benefit from the 
emerging  EU  instruments  and  vehicles  of  the  Innovation  Union  and  Resource 
Efficient  Europe  Flagships  as  well  as  the  post-2013  Cohesion  Policy  and  Horizon 
2020.  For  example,  the  Commission  has  proposed  a  strong  innovation  component 
within  the  provisions  of  the  2014-2020  Cohesion  Policy,  which  will  give  greater 
prioritisation  to  innovation  due  to  the  explicit  conditions  for  Member  States  in  this 
direction. 

Further  analysis  of  the  challenges  and  opportunities  will  lead  to  further  actions  for 
accelerating eco-innovation. This work should be based on a multi-stakeholder group 
and on the partnering approach starting from 2012. 

5. 

THE ECO-INNOVATION ACTION PLAN 

The Plan includes targeted actions both on the demand and supply side, on research 
and  industry  and  on  policy  and  financial  instruments.  The  implementation  of  the 
actions  will  be  supported  by  the  partnering  approach  between  stakeholders,  private 
and public sector, and the European Commission. 

The Commission will foster key drivers for the market uptake of eco-innovation by: 

• 

• 

• 

• 

• 

• 

using  environmental  policy  and  legislation  as  a  driver  to  promote  eco-
innovation (Action 1); 

supporting demonstration projects and partnering to bring promising, smart and 
ambitious operational technologies to the market that have been suffering from 
low uptake (Action 2); 

developing new standards boosting eco-innovation (Action 3); 

mobilising financial instruments and support services for SMEs (Action 4); 

promoting international cooperation (Action 5);  

supporting  the  development  of  emerging  skills  and  jobs  and  related  training 
programmes to match the labour market needs (Action 6); 

13 

IDEA  Consulting  and  Ecorys,  ‘Study  on  the  competitiveness  of  the  EU  eco-industry’,  2009; 
Roland Berger, ‘Innovative environmental growth markets from a company perspective’, 2007. 

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• 

promoting  eco-innovation  through  the  European  Innovation  Partnerships 
foreseen under the Innovation Union (Action 7). 

5.1. 

Action 1:  Environment policy and regulation for promoting eco-innovation 

EU environmental legislation has traditionally been one of the most important drivers 
for  eco-innovation  and  for  the  development  of  strong  European  industries  in  areas 
such  as  water,  air  pollution,  waste  management,  recycling,  and  climate  change 
mitigation.  Environmental  policy  can  also  direct  research  and  development  efforts 
and set the pace of technological change. 

For example, the REACH14 regulation lists substances of very high concern (SVHC) 
for which substitution is required when safer alternative substances  or  technologies 
become technically and economically feasible. This incentivises the active search for 
alternatives  and  stimulates  R&D  activities  towards  delivering  competing  and  safer 
substitutes. The REACH regulation is also an example of how EU policies can drive 
innovation  worldwide.  Chemical  companies  across  the  world  follow  the  REACH 
when developing products which should meet the requirements of EU markets. 

On  the  other  hand  a  regulatory  framework  creating  lock-ins  into  insufficiently 
ambitious or outdated standards or technologies may be a barrier to eco-innovation. 
Legislation should therefore be revisited and reinforced to deliver strong and steady 
incentives driving eco-innovation as well as sufficient predictability for investors. 

As foreseen in the Innovation Union the Commission will undertake a screening of 
the  regulatory  framework  in  the  environmental  area.  In  this  context  possible  gaps 
will  be  identified,  new  rules  implemented  and  existing  ones  reviewed  in  order  to 
provide a coherent legislative framework that promotes eco-innovation. 

For example, in the future, when designing, revising an implementing environmental 
legislation and policies, attention should be paid to: 

(a) 

(b) 

(c) 

the potential of innovation for improving the environment for example through 
allowing  for  flexibility  in  prescribed  technological  solution  or  by  providing 
room for more stringent and robust environmental standards (in order to avoid 
technological lock-ins); 

to 
the  barriers 
implementation;  

innovation  within  environmental 

legislation  and 

its 

the  need  to  facilitate  the  emergence  of  commercially  viable  new  products  or 
practices;  

(d) 

the need to accelerate the uptake of eco-innovation in all policy areas.  

14 

Regulation  (EC)  No  1907/2006  of  the  European  Parliament  and  the  Council  on  the  Registration, 
Evaluation, Authorisation and Restriction of Chemicals (REACH) 

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Valuable work already carried out in cooperation with OECD15 recognises the need 
to improve policies to better support eco-innovation taking into account factors such 
as  market  dynamics,  technological  trajectories,  coordination  and  consistency  of 
different policy instruments. 

Milestones 

• 

• 

• 

Based on existing work the Commission will develop in 2012 a methodology 
aiming  at  assessing  the  likely  barriers,  drivers  and  impacts  of  environmental 
legislation,  policy  and  regulatory  initiatives  on  eco-innovation  and  at 
optimizing its market diffusion. 

In  the  revision  of  existing  water  policy,  air  quality  and  emission  standards, 
building standards, existing prevention, re-use, recycling, recovery and landfill 
diversion targets, as foreseen in the frame of the Resource Efficiency Roadmap 
respectively  in  2012,  2013  and  2014,  the  Commission  will  integrate  eco-
innovation objectives. 

Eco-innovation  potential  should  be  at  the  centre  of  the  revision  of  existing 
infrastructure standards, including transport, energy, buildings, and ICT, while 
simultaneously leading to enhanced climate resilience.  

•  When developing implementing measures in 2012 under the Waste Framework 
Directive  and  under  other  waste  legislation,  the  Commission  could  for 
example: 

– 

– 

– 

promote eco-design for implementing the ELV (End-of-Life Vehicles), WEEE 
(Waste Electrical and Electronic Equipment), RoHS (Restriction of Hazardous 
Substances), Batteries and Accumulators, and Packaging Directives; 

develop  end-of-waste  criteria  under  Article  6  of  the  Waste  Framework 
Directive for copper, paper, glass, plastics, compost and, possibly, other waste 
streams. These criteria will be designed to develop demand and confidence in 
secondary  raw  materials  and  support  and  drive  innovative  waste  collection, 
separation and treatment technologies for high quality secondary materials; 

develop  minimum  standards  for  waste  treatment  activities  at  EU  level  in 
response  to  Article  27  of  the  Waste  Framework  Directive,  where  such 
standards are cost efficient, based on best available techniques and innovative 
solutions. 

5.2. 

Action 2:  Demonstration projects and partnerships for eco-innovation 

In spite of on-going funding programmes and initiatives, a significant gap still exists 
between  the  availability  of  new  technologies  and  their  commercialisation  into 
marketable  products.  This  is  for  example  the  case  for  innovative  wastewater 
treatment  and  water  purification  technologies16  such  as  membranes,  or  new 

15 
16 

OECD, ‘OECD studies on Environmental Innovation – Better policies to support eco-innovation’, 2011. 
"EIO Thematic Report: Water Innovation" Eco-Observatory, May 2011.  

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technologies  for  biological  removal  of  ammonium  developed  by  the  ICON 
project17,18. 

In  their  final  report  to  the  Commission  on  28  June  201119,  the  High  Level  Expert 
Group on Key Enabling Technologies (KETs) underlines the importance of funding 
opportunities for product development and demonstration activities in order to fill the 
gap between technology and market up-take to increase European competitiveness. 

As  from  2012  the  Commission  will  support  targeted  eco-innovation  demonstration 
projects  and  ad  hoc  partnerships  implementing  innovative  technologies  which  in 
spite  of  their  high  environmental  and  commercial  potential  did  not  succeed  in 
reaching  the  market.  Priority  will  be  given  to  technologies  suitable  for  reaching 
stricter, smarter and ambitious environmental standards than those currently in place 
effectively and efficiently. Overall goal of this action is to demonstrating the market 
viability of these technologies  

Starting 2014, Horizon 2020 will continue to support such demonstration projects as 
well as projects implementing technological and societal innovation. 

Milestones 

• 

Selection  of  the  above  described  technological  demonstration  projects  by  end 
2012 as part of the last FP7 call for proposals. Participation would be open to 
all  industrial  sectors.  Possible  fields  include  demolition  waste  -  the  largest 
waste  stream  -;  remediation  of  soil,  sediments  and  groundwater;  wastewater 
and  sludge  treatment;  pesticides  and  fertilisers  in  agriculture;  urban  mining; 
waste  electric  and  electronic  equipment,  including  rare  elements  and  gold; 
climate change adaptation.  

• 

Selection  of  technological  and  societal  demonstration  projects  from  2014  and 
onwards that could be supported and implemented under Horizon 2020. 

5.3. 

Action 3: 
services to reduce their environmental footprint 

Standards  and  performance  targets  for  key  goods,  processes  and 

New  and  ambitious  standards  and  performance  targets  are  a  powerful  tool  for 
supporting  innovation,  increasing  productivity  and  opening  up  opportunities  of  the 
Single Market. 

As a complement, labelling schemes indicating performance standards of a product 
can be a powerful tool to communicate the benefits of eco-innovation. For example, 
since the adoption of the energy efficiency policy and the energy labelling directive20 
the  market for household  appliances has been transformed towards energy-efficient 

17 
18 
19 
20 

http://tnw.tudelft.nl/en/about-faculty/departments/biotechnology/research/research-cooperation/icon/ 
http://ec.europa.eu/research/water-initiative/pdf/4th_wwf_brochure_en.pdf 
http://ec.europa.eu/enterprise/sectors/ict/key_technologies/kets_high_level_group_en.htm 
Council  Directive  92/75/EEC  on  the  indication  by  labelling  and  standard  product  information  of  the 
consumption of energy and other resources by household appliances 

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products, giving 700 TWH21 of energy-savings and increasing the competitiveness of 
European industry. 

Building  on  the  standardisation  package22  the  Commission,  in  cooperation  with 
stakeholders, will ensure that new or revised standards result in strong incentives for 
innovation,  do  not  create  inertia  or  lock-ins,  are  performance-related,  and  take 
resource efficiency, environmental and climate change concerns into account. 

Milestones 

The  European  Commission  with  the  Member  States  and  in  cooperation  with 
international standardization bodies will set up an interactive process to identify and 
prioritise  those  areas  where  the  development  of  standards  and  performance  targets 
has the greatest potential in terms of driving eco-innovation.  

Some examples of such areas that could be considered as from 2012 are: 

• 

• 

• 

• 

on-site verification of characterisation of waste; 

drinking water and sewage collecting system pipes;  

waste  treatment  activities  in  response  to  Article  27  of  the  Waste  Framework 
Directive.; 

sustainable  construction  materials  and  insulation  of  buildings  to  support  the 
implementation of the Directive on the Energy Performance of Buildings23.  

5.4. 

Action 4: 

Finance and support services for SMEs  

Public-sector  financing  is  needed  and  justified  to  accelerate  eco-innovation  in  the 
private  sector,  particularly  in  SMEs.  Due  to  the  relative  immaturity  of  the  market, 
access  to  finance  is  especially  difficult  for  small  businesses  engaging  in  eco-
innovation where the perceived commercial risk is greater. Financiers and investors 
tend to use the same investment rationale for eco-innovation as for other investments 
i.e. the same expected returns and same level of accepted risks. Moreover, the added 
value  created  by  reducing  environmental  pressures  is  not  accounted  for  and  only 
plays a marginal role in investment decisions. 

Policy  measures  can  help  create  more  favourable  financial  and  more  flexible  risk-
sharing  conditions.  Further  support  to  SMEs  should  be  mobilised  to  improve 
investment readiness, networking opportunities as well as market confidence in eco-
innovation. 

21 

22 

23 

Estimated  savings  due  to  energy  labelling  for  cold  appliances,  dishwashers  and  washing  machines 
between 1996 – 2020.  
COM  (2011)  311  final:  Communication  from  the  Commission:  A  strategic  vision  for  a  European 
standard: Moving forward to enhance and accelerate the sustainable growth of the European economy 
by 2020 
COM 2002/91/EC, Directive on the energy performance of buildings  

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ETAP and other European policies and initiatives, such as the Cohesion Policy, have 
already taken some steps to mobilise funding for eco-innovation. Efforts to mobilise 
funding  for  eco-innovation  will  continue  as  part  of  current  multiannual  financial 
framework  2007-2013  and  will  be  reinforced  under  Horizon  2020  Specific 
Programmes "Tackling Societal Challenges" and "Creating industrial leadership and 
competitive frameworks". The Commission is considering the earmarking of funding 
for eco-innovation, in order to face the specific financing challenge in this area. 

Milestones 

In the context of current multiannual financial framework: 

• 

• 

• 

• 

The  Commission,  in  cooperation  with  the  Enterprise  Europe  Network24,  will 
expand the activities of the "environmental assistants for SMEs". The assistants 
will help SMEs seize the business opportunities created by eco-innovation. The 
scheme will consolidate environmental sound approaches in SMEs, raise their 
awareness and facilitate the acquisition of skills to stimulate eco-innovation. 

In 2012 the Commission will establish a European network of eco-innovation 
financiers  and  investors  with  a  view  to  mobilising  them  and  defining  better 
their policy needs in order to provide faster investment and finance.  

The  Commission  will  help  eco-innovative  European  enterprises  gain  better 
access 
to  global  markets.  The  Enterprise  Europe  Network,  European 
technology  centres  outside  Europe  and  the  EU  Delegations  will  provide 
additional  support  for  participation  in  trade  fairs  and  trade  visits,  for  links 
between  SME  support  networks  in  Europe  and  elsewhere  and  for  market 
intelligence and technology needs assessments.  

Furthermore,  the  European  Commission  will  develop  initiatives  to  improve 
confidence  in  new  environmental  technologies  and  eco-innovative  solutions 
entering the EU and global markets, informed by the results of an experimental 
voluntary  pilot  programme  on  environmental  technology  verification  (ETV), 
whose  principles  and  benefits  are  described  in  the  Staff  Working  Paper 
attached to the Action Plan. 

As from 2014, in the context of the next multiannual financial framework, including 
Horizon  2020  and  the  Cohesion  Policy,  the  Commission  will  take  appropriate 
initiatives to: 

•  Work with the Member States and regions to mainstream eco-innovation in the 
2014-2020  operational  programmes  of  the  Cohesion  Policy,  in  particular 
through  the  regional  innovation  strategies  for  smart  specialisation,  which  are 
proposed as ex-ante conditionality.  

• 

Develop  two  innovative  financial  instruments:  an  EU  Loan  &  Guarantee 
Service  and  an  Equity  Instrument  for  research  and  innovation.  The  first  will 

24 

http://www.enterprise-europe-network.ec.europa.eu/index_en.htm. 

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11 

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have a demand driven as well as a policy driven component which will include 
eco-innovation. The second will concentrate on the start-up and growth phase 
and  have  a  thematic  focus  linked  to  eco-innovation.  Both  instruments  will 
feature ad-hoc investment incentives to promote mobilisation of private finance 
in the area of eco-innovation; 

• 

• 

Develop  technical  assistance  schemes  to  help  SMEs  and  the  financial  sector 
develop  bankable  projects,  appraise  their  bankability  and  implement  projects 
benefiting from risk financing; 

Horizon 2020 will strengthen the role of eco-innovation and inter alia support 
eco-innovative SMEs in their early stage of market penetration.  

5.5. 

Action 5: 

International cooperation  

Eco-innovation  is  key  to  facilitating  the  global  transition  towards  sustainable 
development  by  greening  the  economy.  In  this  context  the  Commission’s 
Communication  on  Rio+2025  emphasizes  inter  alia  the  need  to  put  in  place  market 
and  regulatory  measures  that  foster  eco-innovation  globally  and  ensure  their 
enforcement. 

The communication "A strategic European framework for international  science  and 
technology cooperation"26, the Commission proposes actions to deepen the European 
Research  Area  (ERA)  through  greater  integration  and  cross-border  coordination  of 
research  investments  and  activities.  It  aims  inter  alia  to  increase  Europe's 
attractiveness as a place to invest in research and innovation. 

In  this  context  a  Strategic  Forum  for  International  Science  and  Technology 
Cooperation (SFIC) has been established to drive forward the European Partnership 
for  Science  &  Technology  cooperation.  This  Forum  will  aim  at  identifying  and 
coordinating joint initiatives between Member  States  and the Commission vis-à-vis 
third countries. Initiatives could include eco-innovation and eco-innovation capacity 
building and adaptation according to the needs of recipient countries. 

Emerging economies such as China, India, Brazil and Russia offer significant market 
and  partnership  opportunities  for  European  eco-innovators.  However,  accessing 
those  markets  remains  a  challenge  due  to  high  and  unidentified  risks,  investment 
protection and lax intellectual property right protection. 

To  support  market  access  and  partnerships,  the  Commission  will  take  appropriate 
initiatives to:  

• 

Promote  benchmarking  and  harmonisation  of  standards  and  requirements  for 
environmental  goods  and  services  and  for  the  environmental  performance  of 
products. This is to be encouraged within bilateral and regional dialogues with 

25 

26 

COM(2011)  363  final,  Communication  from  the  Commission,  "Rio+20:  Towards  the  green  economy 
and better governance" 
COM(2008)  588  final,  Communication  from  the  Commission,  "A  strategic  European  framework  for 
international science and technology cooperation" 

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emerging  economies.  Relevant  programmes  and  projects  will  be  supported 
under  cooperation  programmes  such  as  the  SWITCH27  Asia  Programme  to 
promote  sustainable  consumption  and  production.  Expansion  of  such 
programmes to other regions, particularly in Africa and Latin America will be 
explored. 

• 

• 

• 

Promote,  in  bilateral  and  multilateral  policy  dialogues  as  well  as  in  trade 
negotiations  and  agreements,  exchanges  on  policies  for  eco-innovation 
including  measures  for  the  liberalisation  of  trade  in  environmental  goods  and 
services,  elimination  of  cost  barriers  to  SMEs  involvement  in  global  value 
chains,  investment  protection  and  IPR  protection.  Networking  between 
investors, financiers and enterprises will also be promoted. 

Include  environmental  technologies  and  eco-innovation  in  co-operation  with 
neighbouring  countries,  such  as  the  Eastern  Partnership28,  the Partnership  for 
Democracy  and  shared  Prosperity  with  the  Southern  Mediterranean  and  the 
Black Sea Synergy.  

Cooperate with the United Nations Environment Programme (UNEP) and the 
United  Nations  Industrial  Development  Organisation  (UNIDO)  in  reinforcing 
the network of national cleaner production centres. These centres will facilitate 
the  dissemination  of  eco-innovation  best  practice  and  facilitate  networking 
between eco-innovators in developed and emerging economies. 

Milestones 

• 

• 

In  2012  the  European  Commission  will  develop  a  policy  toolbox  supporting 
technology transfer of established environmental technologies and solutions. 

As  part  of  the  Rio+20  process  the  European  Commission  together  with 
international partners will contribute to set up a framework for integrating eco-
innovation  into  the  international  sustainability  dialogue  and  outcomes  of  the 
Rio+20  summit  in  2020,  as  a  possible  trigger  to  accelerate  the  transition 
towards a green economy. 

5.6. 

Action 6: New skills and jobs 

New  skills  are  required  to  facilitate  the  transition  to  a  greener  economy  and  to 
provide  related  reinforced  skilled  workforce  for  businesses.  The  Agenda  for  New 
Skills and Jobs underlines the need to match skills supply with labour market needs, 
in particular in terms of newly-emerging and expanding skills such as those required 
by green and greener jobs. 

27 

28 

EN 

The  SWITCH-Asia  Programme  is  a  grants  programme  funded  through  the  EU's  Development  Co-
operation 
- 
http://ec.europa.eu/europeaid/where/asia/regional-cooperation/environment/switch_en.htm 
COM  (2008)  823  final:  Communication  from  the  Commission  to  the  European  Parliament  and  the

(DCI),  Regulation 

(EC)  No 

Instrument 

1905/2006 

(OJ  L 

378/41) 

Council: ‘Eastern Partnership’ 

13 

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A European Sector Council on skills for green and greener jobs will be established to 
facilitate  exchanges  of  information  between  the  Member  States  on  skills  profiles, 
training  programmes  and  skills  gaps  in  the  environmental  goods  and  services 
industry and in other relevant industries. 

Milestones 

•  With  the  establishment  of  the  "EU  Skills  Panorama",  from  2012  the 
Commission  will  contribute  to  increased  mobility  on  the  labour  market  by 
providing  information  on  current  and  future  skills  supply  and  mismatches.  It 
will include a specific focus on skills for green jobs. 

5.7. 

Action 7:  European Innovation Partnerships 

European  Innovation  Partnerships  (EIPs)  are  proposed  under  the  Europe  2020 
Flagship Initiative for an Innovation Union. The objectives of these EIPs are to join 
up  actors  and  resources  around  common  targets  to  speed  up  breakthrough 
innovations  to  solve  specific  societal  challenges  where  there  is  also  a  large  market 
potential for EU business. 

Resource  efficiency  is  a  priority  notably  in  the  fields  of  raw  materials,  sustainable 
agriculture and water, where EIPs are currently under consideration. By bridging the 
gap  between  a  more  resource  efficient  economy,  ambitious  environmental  goals  as 
well as business opportunities eco-innovation is a major tool supporting these EIPs. 

Milestones 

• 

• 

Potential actions could include testing green public and private procurement for 
promoting  eco-innovation.  Networks  of  public-  and  private-sector  procurers 
and  purchasers  could  be  set  up  and  tender  specifications  could  be  tested  and 
developed for wider use in both public and private sectors;  

Other promising areas that may be considered include bio-gas from bio-waste, 
sustainable chemistry and eco-system services. Best approaches for combining 
demand  and  supply-side  measures  in  these  areas  will  be  identified  by  the 
Commission in close consultation with stakeholders and Member States. 

6. 

GOVERNANCE AND AWARENESS 

6.1. 

Governance structure 

Governance-specific  networking  activities  and  schemes  to  improve  the  knowledge 
base  and  awareness  for  eco-innovation  will  be  established  under  the  Innovation 
Union  as  well  as  under  Horizon  2020.  Simple  and  flexible  systems  in  which  the 
participation of key stakeholders is broad and balanced29are foreseen. 

29 

SEC(2011)  1028  final,  "The  pilot  European  Innovation  Partnership  on  Active  and  Healthy  Aging 
(AHA). First experiences on governance and processes"  

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In  this  context,  and  building  on  the  positive  experience  of  the  (ETAP)  High  Level 
Working  Group,  an  Eco-innovation  High  Level  Multi-stakeholder  Steering  Group 
will  be  set-up  for  mainstreaming  eco-innovation,  facilitating  policy  learning,  peer 
reviewing  the  measures  undertaken,  as  well  as  to  monitor  implementation  of  this 
Action Plan. 

In addition, a dedicated High-Level Working Group will continue bringing together 
Member  States  to  facilitate  exchanges  of  information,  provide  stronger  policy 
guidance, at both EU and national levels. 

The  ETAP  Stakeholder  Forum  which  mobilizes  and  facilitates  networking  between 
sectoral  stakeholders  will  have  a  more  focussed  orientation  on  business  and  will 
develop targeted and reachable recommendations that can be integrated into EU and 
national policies. 

Milestones 

• 

As from 2012, this High-Level Multi-stakeholder Steering Group, composed of 
representatives  of  Member  States,  business,  industry,  particularly  SMEs, 
research and other key stakeholders, will support measures for eco-innovation 
uptake,  if  necessary  with  the  support  of  specific  thematic  Multi-stakeholder 
expert working groups. 

6.2. 

Cooperation between the Commission and the Member States 

Regular exchanges of information and good practice between Member States as well 
as the regions on eco-innovation policies are essential. A better knowledge base on 
environmental  pressure  points,  policies,  markets  and  the  environmental  goods  and 
services industry will also be needed to promote eco-innovation in Europe and lead 
to appropriate policies. 

Milestones 

• 

• 

Based on the lessons learned with ETAP roadmaps, voluntary Eco-innovation 
national roadmaps will be agreed with Member States with the aim to identify 
most efficient policies, facilitate policy learning between the Member States as 
well  as  set  the  appropriate  level  of  implementation  required  to  create  the 
conditions  for  eco-innovation.  These  Roadmaps  will  build  on  existing 
initiatives for promoting environmental technology but with a sharper focus on 
eco-innovation in both the private and public sectors and will take into account 
global sustainability goals to contribute to their attainment. 

The  Commission  will  cooperate  with  the  relevant  national  and  regional 
authorities to integrate eco-innovation in the initiatives of the Cohesion Policy 
and the Rural Development Policy in the area of innovation. In this respect the 
on-going  development  of  the  "Smart  Specialisation  Platform"30  represents  a 
key instrument in building the adequate governance capacity. 

30 

http://ipts.jrc.ec.europa.eu/activities/research-and-innovation/s3platform.cfm 

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• 

• 

The  Commission  will  build  on  the  experiences  of  the  "Eco-innovation 
Scoreboard"31 and other relevant indicators for eco-innovation to monitor and 
review measures and action taken by Member States and the EU.  

The  initiative  on  "Accelerating  eco-innovation  policies"32  for  identifying  best 
practice in eco-innovation policy-making will be re-enforced in order to scale 
up good practice in Member States. 

6.3. 

Raising awareness of eco-innovation benefits and opportunities 

Uncertainty about demand from the market is one of the main barriers to a fast up-
take  of  eco-innovation.  Greater  social  acceptance  of  eco-innovative  technologies, 
processes, services and products needs to be achieved. 

including  Member  States, 

This social acceptance can be achieved if all interested parties make efforts to raise 
local  and  regional 
awareness  of  eco-innovation, 
authorities,  industry  and  civil  society.  The  Commission  will  also  take  actions  to 
explain the importance of eco-innovation as a key driver towards a greener and more 
sustainable economy, with a particular focus on its potential to generate growth and 
create  new  jobs.  These  efforts  will  build  on  existing  communication  activities 
undertaken  as  part  of  the  corporate  communication  of  the  European  Commission, 
such as on Resource Efficiency. 

7. 

CONCLUDING REMARKS 

Five years of implementation of the EU policies on environmental technologies, and 
the  emergence  of  vibrant  green  businesses  in  the  EU,  have  shown  the  potential  for 
eco-innovation to create new business opportunities and growth and jobs in Europe. 

However, more remains to be done requiring strengthened and broader actions. That 
is why current actions should be stepped up, why use of existing resources should be 
optimised  and  additional  financial  resources  mobilised.  The  Action  Plan  boosts 
efforts  for  eco-innovation,  provides  a  clear  way  forward  and  is  thus  a  logical 
successor to ETAP. 

An  ambitious  EU  eco-innovation  agenda  will  also  help  to  respond  better  to  global 
environmental challenges and to seize the opportunities on the global markets in line 
with the goals of the Europe 2020 strategy. It will provide the European Commission 
and the Member States with new tools to achieve the Europe 2020 goals and sets out 
a  future  framework  for  eco-innovation.  The  mid-term  review  of  the  upcoming 
financial  perspective  will  provide  a  good  opportunity  to  assess  the  achievement  of 
the goals set in this Action Plan. 

31 
32 

See the EU-funded project Eco-innovation Observatory; http://www.eco-innovation.eu/  
See the EU-funded project "Accelerating eco-innovation policies", http://www.ecopol-project.eu/ 

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Annex 1. Eco-innovation benefits business and the environment 

The global economy will have no choice but to adjust to environmental and resource 
constraints and this will need eco-innovation. This can also generate jobs and growth 
and  is  essential  for  competitiveness  of  the  economy,  particularly  in  Europe,  which 
has historically based its economic growth on intensive resource use.  

The EU is well placed to take up its role in the global transition towards a more 
sustainable economy 

European  environmental  policies  and  increasing  global  environmental  challenges 
have led to the emergence of a significant and competitive environmental goods and 
services sector in Europe. 

For example, European eco-industries are already a significant economic sector, with 
an  estimated  annual  turnover  of  €
 319  billion  or  about  2.5 %  of  the  EU’s  gross 
domestic  product33  (GDP).  This  means  that  they  are  larger  than  the  steel, 
pharmaceuticals  or  automobile  industries.  Recently,  eco-industries  have  been 
growing  by  around  8 %  a  year.  The  main  sub-sectors  deal  with  waste  management 
(30 %), water supply (21 %), wastewater management (13 %) and recycled materials 
(13 %).  The  sector  directly  employs  3.4  million  people,  around  1.5 %  of  all 
Europeans  in  employment.  Around  600 000  additional  jobs  were  created  between 
2004  and  2008.  The  annual  growth  rate  in  employment  in  all  subsectors  between 
2000 and 2008 was roughly 7 %. 

European businesses recognise the opportunity 

The  potential  of  eco-innovation  is  recognised  by  the  business  community.  Venture 
capital (VC) investments in Europe34 have increased greatly over the last decade. In 
 0.3 billion in 2004. 
2010, they added up to app. €
Despite growing market uncertainty the figure was down only 7% compared to 2009, 
showing  the  great  resilience  and  potential  of  the  sector.  Energy  generation  and 
energy efficiency dominate these investments. These two sectors alone took 71% of 
the capital invested in the fourth quarter of 2009. 

 1.3 billion in this sector, up from €

Environmentally  safe  and  energy-  and  resource-efficient  products,  processes  and 
services are increasingly enlarging a competitive advantage across many businesses 
and  sectors.  Manufacturing  firms  have  moved  from  ‘end-of-pipe’  solutions  to 
‘closed-loop’  approaches  that  minimise  material  and  energy  flows  by  changing 
products and production methods and reusing waste as a new resource for production 
-  all  of  which  cut  costs.  However,  bottlenecks  and  barriers  still  prevent  the  full 
exploitation of such potential. 

Protection  from  climate  change  impacts  and  weather-related  disasters  will  also 
provide a wealth of opportunities. Since 1980, about 95% of economic losses caused 

33 

34 

IDEA  Consulting  and  Ecorys,  ‘Study  on  the  competitiveness  of  the  EU  eco-industry’,  2009; 
Roland Berger, ‘Innovative environmental growth markets from a company perspective’, 2007. 
Cleantech Group press release of January 7th, 2010 on Cleantech venture capital investments in 2010. 
The figures provided refer to cleantech investments for the Europe/ Israel region.  

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in  Europe  by  catastrophic  events  resulted  from  weather  and  climate-related  events, 
and  such  pattern  will  be  exacerbated  by  climate-change.  In  the  field  of  climate 
change  adaptation  and  Disaster  Risk  Prevention  (DRR),  investing  options  will 
expand  and  innovative  funding  and  climate-proofing  schemes  will  be  needed.  The 
insurance industry will also be confronted with novel challenges and opportunities. 

Future global opportunities must be seized 

The EU has the technological capability to become a major player for green goods, 
processes  and  services.  The  EU  has  a  thriving  research  community  and  a 
technological  lead  in  many  areas.  This  is  reflected  in  its  leading  position  in  world 
trade, as shown below (excluding intra-EU trade). 

The European eco-industry sector is well-positioned globally 35 

50%

45%

40%

35%

30%

25%

20%

15%

10%

5%

0%

EU

US

JP

China

S.Korea

Publication share

Patent share

Trade share (w ithout intra-EU trade)

 1 trillion in 2007, with 
The global market for environmental industries was worth €
energy-efficient  technologies  playing  a  large  part  (€
 450 bn).  Europe's  market  share 
differs from one sector to another. For example, in the cases of automatic separation 
of  materials  and  solar  power  stations,  Europe  accounts  for  more  than  70 %  of  the 
total  market.  In  synthetic  biofuels,  solar  cooling  systems  and  energy-storage 
technology,  European  industry  leads  R&D.  The  average  market  share  of  European 
companies  was  above  30 %  in  waste  management  and  recycling,  power  generation, 
sustainable mobility, energy efficiency and sustainable water management. 

The  world  market  for  these  products  and  services  is  growing  by  5 %  a  year  and  is 
expected  to  triple  by  2030  (see  the  graph  below  for  growth  projections).  The  EU 
makes  up  roughly  one  third  of  the  world  market  and  is  a  net  exporter.  However, 
global competitors are emerging. In the wind energy sector, incumbent EU suppliers 
face new entrants seeking to profit from global efforts to limit climate change. The 

35 

Source: IDEA Consult, ECORYS, 2009. Study on the competitiveness of the EU eco-industry; Federal 
Ministry  for  the  Environment,  Nature  Conservation  and  Nuclear  Safety,  2009,  "Greentech  –  Made  in 
Germany 2.0" 

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EU  must  build  upon  its  capabilities  and  boost  the  underlying  drivers  in  order  to 
consolidate its leading position and seize the opportunities emerging. 

Expanding Global Markets for eco-industries36 

Billion Euro/per annum

1.000 €

5%/a

900 €

800 €

700 €

600 €

500 €

400 €

300 €

200 €

100 €

0 €

7%/a

5%/a

8%/a

6%/a

3%/a

Green energy
supply

Energy Efficiency

Material
efficiency

Green mobility

Water

Waste

Market volume 2008 Market forecast 2020

EU SMEs must benefit from the transition 

The  make-up  of  eco-industries  varies  widely  from  one  sector  to  another.  For 
example,  for  waste  management,  soil  remediation,  wind  power  and  renewable 
energy, approximately  10 % of  companies account  for  almost 80 % of  the turnover. 
On the other hand, small firms are stronger on new regulation-driven markets, such 
as eco-construction and renewable energy. It is also worth noting that for SMEs the 
potential to eco-innovate and as a result improve resource productivity is expected to 
be  higher 
large  enterprises.  Case  studies  on  material  efficiency 
improvements in Germany have revealed that on average around EUR 200,000 have 
been saved per company, with investment costs under EUR 10,000 for nearly half of 
the companies37. 

than  for 

All in all, eco-industries are marked by the presence of large numbers of small and 
medium-sized  enterprises  (SMEs).  These  firms  account  for  approximately  half  of 
total employment. Hence, SMEs in partnership with industries must play increasing 

36 

37 

Source: IDEA Consult, ECORYS, 2009. Study on the competitiveness of the EU eco-industry; Federal 
Ministry  for  the  Environment,  Nature  Conservation  and  Nuclear  Safety,  2009,  "Greentech  –  Made  in 
Germany 2.0"  
Eco-innovation Observatory, Annual Report 2010, “Business perspective: Saving material costs” 

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role in innovating new technologies and solutions and also use them. Public policies 
and action must create better conditions for eco-innovation 

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