Techno-economic study on the potential of European industrial companies regarding Europe's Green Deal : final report.
Date: 2022-02-01
Institutions: Joint Research Centre
Subjects: European industrial area, carbon neutrality, economic conditions, economic growth, economic instrument for the environment, energy technology, industrial policy, innovation, job security, report, research and development

Techno-Economic study on the potential 
of European Industrial Companies 
regarding Europe's Green Deal 

Final report 

Malanowski, N., Dr. 

Steinbach, J. 

Nisser, A., Dr. 

Beesch, S. 

von Proff, S., Dr. 

Van de Velde, E., Dr. 

Kretz, D. 

2022

This publication is a report by the Joint Research Centre (JRC), the European Commission’s science and knowledge service. It aims to 
provide evidence-based scientific support to the European policymaking process. The scientific output expressed does not imply a policy 
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This document has been produced within the context of the Global Industrial Research & Innovation Analyses (GLORIA) activities that are 
jointly carried out by the European Commission's Joint Research Centre –Directorate Innovation and Growth and the Directorate General 
for Research and Innovation-Directorate F, Prosperity. GLORIA has received funding from the European Union's Horizon 2020 research 
and innovation programme under grant agreement No 811163. 

EU Science Hub 
https://ec.europa.eu/jrc 

JRC126482 

PDF 

ISBN 978-92-76-46286-6 

doi:10.2760/037744 

Luxembourg: Publications Office of the European Union, 2022

© European Union, 2022  

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How  to  cite  this  report:  Malanowsi,  N.,  Steinbach,  J.,  Nisser,  A.,  Beesch,  S.,  von  Proff,  S.,  van  de  Velde,  E.,  Kretz,  D.,  Techno-Economic 
study  on  the  potential  of  European  Industrial  Companies  regarding  Europe's  Green  Deal,  Publications  Office  of  the  European  Union, 
Luxembourg, 2022, ISBN 978-92-76-46286-6 , doi:10.2760/037744, JRC126482. 

Contents 

Abstract ....................................................................................................................................................................................................................................................................... 3 

Executive Summary ......................................................................................................................................................................................................................................... 4 

1 

Introduction..................................................................................................................................................................................................................................................... 7 

2  Study approach and methodology ........................................................................................................................................................................................ 10 

3  Characterisation and assessment of Global Innovation Networks (GINs) along the Green Deal priority 

areas................................................................................................................................................................................................................................................................... 18 

4  Policy context and policy toolbox ............................................................................................................................................................................................ 53 

5  Conclusions .................................................................................................................................................................................................................................................. 64 

References ............................................................................................................................................................................................................................................................. 66 

List of figures ..................................................................................................................................................................................................................................................... 71 

i 

Authors 

Dr. Norbert Malanowski (VDI TZ) 
Jana Steinbach (VDI TZ) 
Dr. Annerose Nisser (VDI TZ)  
Simon Beesch (VDI TZ) 
Dr. Sidonia von Proff (VDI TZ) 
Dr. Els Van de Velde (IDEA Consult) 
Daniela Kretz (IDEA Consult)  

2 

Abstract 

The study provides theoretical as well as case-study based evidence for the potential of European industries 
to become carbon neutral and provide job security and growth in the EU. The study identifies, maps, and 
analyses  Global  Innovation  Networks,  i.e.  networks  between  industry  and  other  actors  that  facilitate 
innovation, and their role in making the European Green Deal a success. The study also presents the main 
current policy context in place in the EU, China and the U.S., e.g. regulatory and financial frameworks, and 
identifies the main drivers and barriers for investing in technologies relevant for Europe's Green Deal. In 
addition, a concise policy toolbox for Research &  Development  &  Innovation (R&D&I)  policies supporting 
technologies relevant for Europe's Green Deal is discussed. It moves beyond the current European, national, 
regional and sectoral policy instruments and mixes of policies based on the insights obtained throughout 
the whole study. The findings offer an important knowledge base for devising new and additional policy 
instruments. 

3 

Executive Summary 

The study is situated in the context of the European Green Deal and provides theoretical as well as case-
study based evidence for the potential of European industries to become carbon neutral and provide job 
security  and  growth  in  the  EU.  The  study  identifies, maps, and  analyses  Global  Innovation  Networks, i.e. 
networks between industry and other actors that facilitate innovation, and their role in making the European 
Green  Deal  a  success.  After  identifying  three  Green  Deal  priority  areas  –  industry  (including  specifically 
chemistry and steel), energy and mobility – and two transversal technologies – batteries and hydrogen –, 
the study presents findings for each of these areas.  

We  start  by  reviewing  the  R&D&I  competitiveness  per  Green  Deal  priority  area.  The  focus  lies  on  the 
assessment of R&D&I competitiveness in five main geographical regions  – the EU, the U.S., Japan, China 
and ’RoW’ (Rest of the World) along the Green Deal priority areas industry, energy and mobility, and the two 
transversal technologies batteries and hydrogen.  

We first explore the industry sector1 as they are one of the main emitters of greenhouse gases. Hence, the 
decarbonization of the industrial sector is crucial. In line with the goals of the European Green Deal, this 
transformation  should  simultaneously  maintain  economic  performance  and  job  security.  Regarding  the 
regional distribution of top R&D investors in the industrial sector, the EU is well positioned. Inside the EU, 
top R&D investing companies are especially centred within Germany. Chinese companies are also strongly 
represented among the top R&D investing companies. Zooming in on R&D investments, the EU has leading 
positions both in terms of total R&D investments (country level) and in terms of R&D intensity. Although in 
the past being on a relatively low level, R&D investments of Chinese companies have recently strongly grown 
both on regional and company level.  

Zooming in on the steel sector, total funding is highest for EU start-ups. At the same time, mean funding 
per  company  is  highest  for  Chinese  start-ups  (double  the  EU  level),  indicating  that  highly  innovative 
enterprises are well positioned in China.2 Over all geographic regions, the number of start-ups in the steel 
sector  is  relatively  low  compared  to  other  sectors,  indicating  high  barriers  to  market-entry.  Also, 
interferences  between  highly  policy-relevant  sectors,  especially  key  enabling  technologies  (KET)  were 
identified within the steel sector. In the chemical sector, interferences mainly with the biotech sector were 
found. In this sector, start-ups in the US received the highest amount of funding, both on regional and firm 
level, and appear most frequently in the database. The regional concentration of funding within the chemical 
sector in  the  EU  is lower than  in  other sectors analysed  (e.g.  steel).  Japanese  start-ups operating  in  the 
chemical sector are not included in the database. 

We then explore the energy sector as the EU has the largest share of top R&D-investing companies operating 
in this sector. Furthermore, total R&D investments are highest in the EU, whereas mean R&D expenditures 
per  company  are  highest  in  the  US  and  China.  In  both  the  US  and  China,  start-ups  in  the  energy  sector 
receive higher amounts of funding than in other world regions. Further findings suggest that companies in 
China  and RoW  are  to  a  large  degree  active  in  the  conventional  energy  sector whereas in  EU  or  US, for 
instance, the share of companies active in the renewable energy sector is growing. Yet, operational profits 
are  still  higher  for  companies  in  the  conventional  than  in  the  sustainable  energy  sector.  The  high  and 
continuously growing number of start-ups operating in the energy sector indicates lower market barriers 
than in the steel sector, for instance. Linkages between the energy sector and KET (especially biotechnology 
and nanotechnology) and key and emerging software technologies (primarily IoT and AI) have been identified 
in the analysis of innovative tech start-ups, which indicates synergy effects between the energy industry 
and the highly policy relevant areas.  

Next, we explore the mobility sector as top R&D-investing companies in this sector are spatially regularly 
distributed on a regional level.  Yet the inner-EU analysis gives a high concentration of actors in specific 
countries, such as Germany that is home to a clear majority of the European companies. Both total R&D 
investments and mean R&D expenditures per company are highest in the EU, with strong growth rates. The 
US  and  Japan  also  record  high  expenditures  for  R&D.  Chinese  companies  recently  increased  their  R&D 
intensities indicating large growth rates. Yet, in terms of funding, US mobility start-ups received the highest 
amount of funding in total, followed by Chinese start-ups, which received the highest sums per company. 

1 In some cases, the study analyses the industry sector on deeper sublevels, mainly the chemical and steel 

sector. 

2 Analysis based on Crunchbase database (2020). 

4 

 
 
     
 
                                           
New foundations of tech start-ups show an immense positive trend, indicating a market with high potential 
for shareholders. Further analyses of mobility tech start-ups reveal linkages to highly policy relevant areas, 
notably key and emerging software technologies (mainly IoT and AI).  

Finally, we zoom in on cross-sectional technologies, more specifically on hydrogen and batteries as they are 
indispensable for the sustainable transformation of all three identified Green Deal priority areas (industry, 
energy, mobility). Analyses of current and emerging tech start-ups operating in the hydrogen sector imply a 
young market still gaining in importance. US start-ups receive the largest share of overall funding, followed 
by EU companies on both macro and firm level. Links to operations in policy relevant fields, such as KETs, 
key and emerging software technologies and advanced manufacturing technologies are also limited. The 
number of start-ups operating in the battery sector has highly and continuously increased during the past 
years, indicating a high  growth potential for this sector.  Again, US start-ups receive the largest share of 
overall funding, whereas Japanese start-ups receive the highest amount of funding per company.  

Another aspect of the study  is to obtain key insights from GINs and R&D&I ecosystems.  The study  uses 
various quantitative and qualitative analyses to identify main relevant companies active in Global Innovation 
Networks (GINs) in the three Green Deal priority areas industry, energy and mobility. These main relevant 
companies are of particular interest due to their role as large R&D investors: they invest in start-ups, help 
smaller firms to grow by purchasing their innovative products, control supply and distribution chains, and 
often collaborate with public research institutions and universities. For increasing the validity of the results, 
the study focusses additionally on some smaller companies.  In depth information on the involvement of 
large R&D investors as well as smaller companies in Global Innovation Networks (GINs) was mainly obtained 
from interviews but triangulated against other results at each step of the study to generate a comprehensive 
picture and to increase validity.  

The  study  presents  ten  case  studies  on  Global  Innovation  Networks  (GINs)  focussing  on  technologies 
connected to sustainability and the goals of the EU Green Deal. The results show that actors are typically 
involved in more than one Global Innovation Network. MNEs tend to be members in more networks than 
SMEs and “younger” companies. Most GINs addressed have a geographic centre in the EU or Europe. At the 
same time, the networks’ geographical scope and the diversity of actors is variable and seems to a certain 
degree correlated with the number of actors involved. In some cases, being located in the EU is seen as an 
enabler for the related technology concerning the aim to become carbon-neutral and the demand for “green” 
technologies. The choice of cooperation partner highly depends on the respective company’s core business, 
specialization and capabilities. Different types of actors tend to have different roles within a given Global 
Innovation Network and a high degree of diversity within the network is seen as beneficial by the actors 
involved. The study also identifies common reasons for being organized in an R&D&I network, such as the 
joint development of new ideas and the access to relevant knowledge or the formation of new partnerships. 
Technologies that are developed within these networks are often closely linked to the members’ usual fields 
of activity. In general, network members expect growth in the sectors related to the technologies in question. 
This  expectation  is  conditioned  by  policy  conditions  pushing  the  demand  for  “green  solutions”  and  the 
resulting current growth of related markets. Yet, although being organized in a GIN is in part a strategic 
benefit due to the spread and reduction of risks, R&D&I projects are often accompanied by high risks. Thus, 
it is necessary to complement the existing policy framework with supportive enabling instruments.  

Next, the study discusses the main current policy context in place in the EU, China and the U.S. and identifies 
the main drivers and barriers for investing in technologies relevant for Europe's Green Deal.  

The political sustainability framework in the EU is driven by the European Green Deal3 and its ambitious aim 
to boost Europe´s competitiveness based on cutting edge innovation in a broad sense. The long-term goal 
of the new growth strategy is to make Europe the first carbon neutral continent by 2050. This entails the 
need  for  structural  transformation  and  crosscutting  policy  support  towards  competitive  sustainability. 
Compared to other regions, the EU policy focus of the Green Deal enabling industrial competitiveness and 

3  The  European  Green  Deal.  COM/2019/640  final.  Brussels:  European  Commission.  Retrieved  from  https://eur-lex.europa.eu/legal-

content/EN/TXT/?uri=COM%3A2019%3A640%3AFIN 

5 

structural transformation is unique. Thus, EU companies and their participation in GINs will play a central 
role in the transition to a more environmentally friendly path while at the same time competing on a global 
level.  

The US innovation system is characterized by a strong focus on private sector innovation and decentralized 
innovation.  Innovation  in  firms,  especially  in  highly  innovative  start-ups,  plays  a  crucial  role  in  the  US 
innovation activities. Since January 2021, a Green New Deal seeks to reduce greenhouse gas emissions, 
create high-paying jobs, ensure that clean air, clean water and healthy food are basic human rights, and 
end all forms of oppression. Just recently, President Biden issued a number of executive actions addressing 
climate change, for instance rejoining the Paris Agreement and a global pact to reduce emissions. 

The Chinese innovation system is characterized by strong, centralized control by the government. In contrast 
to Europe, workers' actors do not play an active role in the innovation systems of the US and China. China 
just recently introduced its 14th 5-year plan 2021-25 that presents an opportunity for China to link its long-
term  climate  goals  with  its  short-  to  medium-term  social  and  economic  development  plans.  In  addition, 
China’s commitment to achieving carbon neutrality by 2060 has set a direction for its economy but requires 
ratcheting  up  ambition  on  its  near-term  climate  policy.  The  new  plan  covers  six  key  areas  of  energy 
development, including the construction of eight large-scale clean energy “bases”, coastal nuclear power, 
electricity transmission routes, power system flexibility, oil-and-gas transportation and storage capacity.  

The  study  also  classifies  barriers  and  enabling  factors  for  R&D&I  policies  supporting  the  sustainable 
transition into three  categorical instruments: regulatory instruments, economic and financial instruments 
and soft political instruments. Insights from a literature review and expert interviews show that in the context 
of  sustainable  transformation  of  the  industry,  regulations  are  seen  as  having  negative  impact  on 
conventional business, such as the EU ETS which increases the price for CO2 leading to less competitiveness 
which  impacts  the  business  model.  At  the  same  time,  an  appropriate  regulatory  framework  is  the 
cornerstone of the new Industry Strategy for a green and competitive EU industry and can lead to benefits 
for sustainable and transformative sectors and technologies. The existing funding instruments and financial 
guidelines are seen as beneficial for the transformation towards a sustainable economy. Yet it is suggested 
to  improve  the  dialogue  between  all  relevant  stakeholders,  such  as  firms  and  political  decision  makers 
regarding the development towards a climate neutral industrial sector.   

Finally, the study developed a policy toolbox. There are three classic categories of policy instruments in the 
field of innovation and industrial policy: (1) regulations, (2) economic and financial instruments, and (3) soft 
instruments. The tradition is that they are discussed separately which is not the best approach when looking 
on new instruments regarding Europe's Green Deal. These new instruments are quite often ‘three in one’ 
which means that they consist of regulations, economic, and financial instruments, and soft instruments. 
This  phenomenon  can  be  found  for  instance  in  Public  Private  Partnerships  like  SPIRE  or  Fuel  Cells  and 
Hydrogen Joint Undertaking (FCH JU). It can be also found in innovation alliances like the European Battery 
Alliance  or  the  European  Clean  Hydrogen  Alliance.  Anticipation-based  innovation  and  industrial  policy 
instruments (‘three in one’) linked with the European Green Deal related technologies can be used, even if 
they are still vague in the initial phase, to systematically design job profiles, qualification requirements and 
employment opportunities. Regulations are seen as having negative impact on conventional business but 
can lead to benefits for sustainable and transformative sectors. Regulation can increase competitiveness, 
however the speed and agility of policies in the EU is seen as too slow. The interviewed companies of various 
sizes  and  from  different  sectors  do  not  report  a  general  funding  gap.  Existing  financial  guidelines  and 
funding  instruments  are  seen  as  beneficial  for  transformation  towards  a  sustainable  economy.  Soft 
instruments  like  the  improvement  of  dialogue  between  all  stakeholders  and  involvement  of  all  relevant 
actors are seen as beneficial for a stronger innovation network. 

6 

 
 
     
 
 
 
 
 
1 

Introduction 

1.1  Background of the study 

The objective of this study is to provide theoretical as well as case-study based evidence for the potential 
of European industries to become carbon neutral and provide job security and growth in the EU, which is 
defined as a key priority in the European Green Deal following declining job prospects and the industries’ 
burden  on  the  environment.  Accordingly,  this  study  identifies,  maps,  and  analyses  Global  Innovation 
Networks and their role in making the European Green Deal a success. The study encompasses the 
following major tasks: 

-

-

-

-

-

Identifying key industries which are working towards carbon efficiency and/or employment security
on a granular level.

Assessing the role of corporate actors in GINs in terms of efficiency, productivity, and employment
by separating economic from technological actors as well as separating technology producers from
users.

Identifying barriers to the development of the role of Europe in GINs.

Proposing a policy toolbox for strengthening European R&D&I and their capabilities in developing
technologies which cater to the European Green Deal.

To provide a comprehensive and exhaustive view of the matter, the study feeds on theoretical and
empirical findings from Global Innovation Network (GIN)  studies relating to Global  Value Chains
(GVCs),  Regional  Systems  of  Innovation  (RSI)  theories,  and  the  institutional  systems  approach
among others, while also addressing economic aspects weighing in, such as infrastructure, labour
market  conditions,  reliability  of  communication  systems,  and  trade  policy  climates  with  other
regions.

- Milestones for this study will be the identification of relevant R&D investors and related actors in
GINs and national/regional innovation systems, their analyses, interviews with key industry players,
and lastly  a  policy  toolbox  facilitating  the  European  industries’  implementation  of  the  European
Green Deal.

The  European  Green  Deal  represents  a  paradigm  shift  in  European  politics  that  is  designed  to  lead  the 
change towards making the European economy digitalised and environmentally sustainable. The long-term 
goal  of  the  new  growth  strategy  is  to  make  Europe  the  first  carbon  neutral  continent  by  2050.  The 
intermediate goal is to decrease greenhouse gas emissions by 55% by 2030. This entails the necessity of 
efforts in Research & Development & Innovation (R&D&I) that will eventually shape EU policy and have a 
direct impact on industry and civil society. The growth strategy includes a timeline for guiding documents to 
be published between 2020 and 2023 (European Commission, 2019d). A central document represents the 
proposal for a European Climate Law, published in March 2020 (European Commission, 2020d). 

The European Green Deal is the ambition of the next European Commission to make Europe the first carbon 
neutral continent by assessing energy-intensive industries and how they can be reshaped. In its first draft 
and after public consultation, the European Green Deal sets to make the European economy carbon neutral, 
restore biodiversity, and provide more reliable job security. Partially through a €1 trillion injection into various 
actors in the European Industry, facilitated by the Sustainable European Investment Plan and justified by 
the  current  investments  in  non-sustainable  practices, the  European  Green  Deal  outlines that  it  wants  to 
reach its goals through targeted investments in various aspects of society and new legislation in line with 
the 3 goals (von der Leyen, 2019), European Commission, 2019e, 2019f). 

FDI and local investments into R&D&I are crucial to innovations which have the potential to lead to carbon-
neutral industry practices and while their effectiveness varies from region to region, they are the first trigger 
for innovation. 

Innovation is identified by theoretical and empirical research as being a crucial driver of job growth in high 
skilled  labour  and  as  being  the  only  viable  investment  option  leading  to  environmentally  friendly 

7 

technologies,  which  are  two  goals  the  EC  wishes  to  reach  with  the  European  Green  Deal  (European 
Commission, 2019, Moser & Feiel, 2019, Johnsen & Ennals, 2011). 

The OECD attributes a key-role to GINs as a crucial policy and research tool to lead the change towards 
what  the  European  Green  Deal  highlights  as  carbon-neutral  industries  and  job-prospect  rich  economies. 
Furthermore, the  OECD stresses the importance for European industries to engage in GVCs and allocate 
subsidies and investments into research leading to expertise in various industries (OECD, 2017).  As GVCs 
are becoming more fragmented than in the early 2000s and productions stages are becoming smaller and 
more geographically dispersed, the accurate assessment of GVCs and GINs and their relation to national 
and regional innovation systems is paramount to policy decisions aimed at catering to the European Green 
Deal (Dosso, Potters & Tübke, 2017). Consequently, collaborations between actors of different stages of 
GVCs  increase  out  of  necessity,  making  a  policy  understanding  of  innovation  systems  and  networks 
increasingly important as well. Protectionist measures are believed to be a limitation to advances in R&D&I 
and Europe’s ability to engage in relevant GVCs. The shift from closed to open innovation is identified as a 
capacitator for GINs (Huawei, 2018).  

Global Innovation Networks are networks of industry actors and other stakeholders such as academia and 
public institutions that facilitate and/or promote innovation. Their value becomes apparent when they allow 
an  understanding  of  e.g.  firms’  relocation  decisions  or  their  choice  of  public-private  partnerships.  GINs 
provide a comprehensive understanding of innovation drivers and hampers. GINs allow for a historical as 
well as projective analysis of companies’ locational, operational, and strategical choices and their position 
in GVCs (Herstad et al., 2014; Dosso, Potters & Tübke, 2017). Unfortunately, comprehensive and actionable 
research of how GINs can contribute towards a greener economy are lacking.  

As a majority of R&D investors are MNEs, this study focuses on large companies in favour of smaller firms. 
Additionally,  large  firms  have  a  bigger  impact  than  SMEs  as  they  are  active  in  several  countries 
simultaneously  and  can  potentially  broaden  the  scope  to  address  the  whole  ecosystem.  As  mentioned 
previously, an understanding of their respective roles in the GINs will give better insights into what current 
market trends and practices are and how they fit into the ambitions of the European Green Deal.  

Europe is undergoing major transitions, each of which has wide-ranging implications on its own. As such, 
digitisation  reforms  employment  and  transfers  jobs  from  obsolete  sectors  to  new  sectors.  Digitisation 
further influences consumers’ expectations and gives niche interest groups a voice to be heard, which has 
direct implications for industries in Europe and beyond. The transition towards a carbon-neutral economy 
and environmentally sustainable society, and the fact that industries are expected to implement circular 
economy strategies while also accounting for planetary boundaries affects the way R&D&I is conducted and 
invested into, beyond affecting job prospects as the digitisation transition does as well. The EC foresees that 
the transition to a carbon-neutral economy will create 1.2 million new jobs, in addition to 12 million new 
jobs expected to result from the other transitions mentioned (European Commission,  2019f; Adler et al., 
2019). If European job growth and carbon net-neutrality are at the core of the ECs plans, it will be relevant 
to provide a mapping of key players in GINs and make sure that they are anchored in Europe. Furthermore, 
providing an overview of European MNEs and what function they accomplish in their respective GVC will give 
a grounded base for the design of policy tools. This is because companies placed at the higher value-added 
functions of GVCs have more leeway and capacity for job-growth in high-skilled positions than companies 
that are active at the lower end (European Commission, 2019e).  

Based on the aforementioned developments in European industries and the targets set within the European 
Green Deal, this study aims to provide insights into the way large (and some smaller) firms operate in and 
engage with GINs, who the stakeholders are, and finally the actions undertaken by private actors towards 
environmental sustainability. 

1.2  Objectives of the study 

The European Green Deal identifies seven policy areas that cover the European ambition to become carbon 
neutral by 2050. This project will zoom in on a subset of the European Green Deal priority areas, including 
clean  energy,  sustainable  industry,  sustainable  mobility,  as  well  as  hydrogen  and  batteries  as  two  key 
technologies. The rationale for the selection of these priority areas is three-fold:  

8 

Contribution to Green Deal objectives: The Green Deal targets, among others, clean energy, sustainable 
industry and sustainable mobility. Together, the sectors of energy, industry and mobility are responsible for 
87% of emissions in the EU-28 (as of 2019). Industrial processes and product use accounts for 8% of total 
greenhouse  gas  (GHG)  emissions,  whereas  transport  accounts  for  25%  and  fuel  combustion  (excluding 
transport)  for energy accounts for 54%  (Eurostat, 2019). Seeing the overall emissions, these areas also 
have a great potential, through key innovations, to make positive contributions to emissions reductions.  

Innovativeness: Highly innovative sectors, such as those depicted in the Strategic Value Chains (SVC) of 
the  Important  Project  of  Common  European  Interest  (IPCEI)  are  linked  to  key  enabling  technologies, 
technological breakthroughs or disruptive innovation. The sectors of energy, mobility and industry have been 
leading the innovation wave related to low carbon and circular innovation, also within the framework of the 
SVC, with many examples already present in their works.  

Competitiveness:  The  selected  areas  are  positioned  within  global  value  chains,  where  it  is  particularly 
interesting to analyse the EU’s competitive position as compared to key global players such as China and 
United States.  

1.3  Structure of D4.1 

This study provides a summary of all activities, findings and conclusions of the entire project. The report 
includes after this short introduction (Chapter 1): 

-

-

-

-

-

Chapter 2: details the study approach and the methodology used in the project;

Chapter 3: provides a characterisation and assessment of Global Innovation Networks (GINs) along
the Green Deal priority areas industry, energy and mobility;

Chapter 4: provides a summary of the policy context and the policy toolbox that was developed as
part of this study;

Chapter 5: provides a brief conclusion;

A list of all references.

9 

2  Study approach and methodology 

In the following, we present our approach as well as the methodology applied for the empirical work. 

2.1.1  Approach 

Figure 1 sketches the overall approach of this project including the different tasks, results and deliverables. 

As a first step, Deliverable D1.1 offered a concise review based on desk research (in the web, scientific 
literature,  industry  and  company  documents),  to  provide  an  enhanced  picture  of  techno-economic 
developments in terms of R&I competitiveness of  companies regarding Europe's  Green Deal, including a 
comparison with international competitors. As part of the analysis of this deliverable, we have presented 
five Green Deal priority areas, namely energy, industry, mobility, hydrogen and batteries. The deliverable 
has also identified a broad set of properties and testable assumptions as a base for positioning the study 
in its context and for developing the subsequent approach of company and stakeholder identification. 

Deliverable D1.2 laid out the methodological approach to identify and assess R&D&I competitiveness of 
companies  and  stakeholders  regarding  Europe's  Green  Deal  (Task  1.2).  Furthermore,  the  deliverable 
proposed an approach for the description and measurement of selected GINs and their R&D&I and economic 
competitiveness over time (Task 1.3). 

In Deliverable D2, the methodology and approach to the data and for the identification of the main relevant 
companies  and  actors  proposed  in  the  previous  step  have  been  applied  (Task  2.1).  Furthermore,  we 
characterised/measured  the  selected  GINs/ecosystems  and  assessed  their  relative  positioning,  providing 
insight on main sector/technology specificities (Task 2.2). Finally, the findings from Tasks 2.1 and 2.3 have 
been validated and missing information have been completed by collecting additional information through 
interviews with managers in companies, industrial organizations, associations and other experts, as well as 
the screening and text mining of Corporate Responsibility reports (Task 2.3).  

Deliverable D3 provided a concise description of the main current policy context in place (e.g. regulatory 
and financial frameworks) allowing to address the main drivers and barriers for investing in technologies 
relevant for Europe's Green Deal (Task 3.1). Furthermore, it presented a concise policy toolbox for R&D&I 
policies supporting technologies relevant for Europe's Green Deal (Task 3.2).4  

The present final report summarises the findings of the preceding tasks and deliverables, including the 
policy  toolbox  and  describing  potential  ways  forward  for  supporting  specific  technologies  (Task  4.1, 
Deliverable  D4.1).  Finally,  the  information  resulting  from  the  proposed  methodology  and  used  for  the 
analysis has been collected and delivered in a dataset format (Task 4.2, Deliverable D4.2). 

4 Note that the present Deliverable 1.2 outlines the methodology to be applied in Deliverable 2, but not the 

methodology for Deliverable 3. 

10 

Figure 1: Overview of project tasks, results and deliverables 

Source: VDI TZ 

Jan-22                                                                                                                            11 

 
 
     
 
 
 
 
 
2.2  Methodology 

The central aim of the methodology was to offer a coherent framework on how to identify key actors and 
GINs relevant to Europe’s Green Deal. Furthermore, the methodology provided a framework to describe and 
measure the identified key actors, their embeddedness in GINs as well as their R&D&I and global economic 
competitiveness.  

The  applied  methodology  combined  various  different  approaches  –  both  of  quantitative  and  qualitative 
nature – in a systematic way (see Figure 2). By combining different methods into a systematic mix-methods 
approach, we could leverage the advantages of each approach, thereby generate a more holistic selection 
of and view on companies and stakeholders, and finally derive conclusions with a higher robustness and 
explanatory power.  

To  identify  relevant  GINs,  companies  and  stakeholders,  we  built  on  exploratory  interviews,  patent  and 
publications analyses, text mining as well as micro- and  macro-data analyses.  To describe and measure 
GINs  in  terms  of  their  R&D&I  and  global  economic  competitiveness,  we  additionally  relied  on  expert 
interviews. The results were then combined in case studies on ten selected GINs. 

Figure 2: Visualization of the methodological approach.  

Source: VDI TZ 

In  the  following,  we  present  selected  results  from  the  patent  and  publication  analyses  as  well  as  the 
textmining. 

2.3  Patent analysis 

The  patent analysis served several goals: First, it allowed to identify companies having  registered  green 
patents,  indicating  R&D&I  activities  in  fields  relevant  to  Europe’s  Green  Deal.  Second,  when  comparing 
companies and sectors, patents are an indicator of companies’ respective R&D&I competitiveness. Finally, 
considering co-patenting, i.e. patents registered by more than one company and/or organisation, offers the 
possibility to identify innovation networks (GINs).  

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We built on a detailed classification of green patents classes provided by the OECD (OECD 2016 and Haščič 
& Migotto 2015). For each of the five Green Deal priority areas, we compiled a list of all registered patents 
from the PATSTAT database. More details on the methodology of selecting relevant patent classes can be 
found in Deliverables D1.2 and D2. In total, we identified almost 20,000 green patents in the priority area 
“mobility”, around 11,000 patents for the energy sector, and between 2,600 and 5,100 for the remaining 
technologies (chemicals, steel, batteries and hydrogen).   

For each of the Green Deal priority areas, we compiled a rank list of the top-20 European patenting firms 
by number of green patents (see Figure 3 for the mobility sector)5. This was used to identify relevant large 
stakeholders with strong activities in the area of green patenting.  

Figure 3: Top-20 European patenting firms by number of green patents (mobility sector) 

Source: VDI TZ 

We also analysed the regional distribution across world areas – EU, US, Japan, China and Rest of the World 
(RoW) – of the top-100 patenting firms by Green Deal Area (see Figure 4). This analysis was used as an 
indicator of the relative positioning in terms of global competitiveness.  

5 More details and figures for the other sectors can be found in Deliverable D2.  

Jan-22  
13 

67761450742137820612810910688626157493735322422220100200300400500600700800 
 
     
 
 
                                                                                                                           
 
 
 
 
                                           
Figure 4: Number of firms among the top-100 patenting firms by Green Deal area and world region 

Source: VDI TZ 

The total number of patents, among the top-100 patenting companies in all Green Deal areas, is 29,562 of 
which  9,292  (about  31  percent)  are  registered  by  companies head-quartered  in  Japan,  7,223  (about  24 
percent)  belong  to  companies  headquartered  in  the  US,  followed  by  5,815  (19  percent)  patents  from 
European firms and 277 (0.94 per-cent) from Chinese companies. The remaining part (about 23.5 percent 
of all patents among the top-100 patenting companies in the identified Green Deal Areas) can be allocated 
to the aggregate of other countries, RoW. 

The summary of the  results  shows that firms  headquartered in Japan, lead the  ranking in both top-100 
patenting  firms  regarding  all  of  the  considered  Green  Deal  priority  areas  as  well  as  the  ranking  for,  in 
descending  order,  batteries,  hydrogen,  mobility  and  energy.  Especially  in  the  first  three  named  sectors, 
Japanese firms are strong competitors in terms of their patent activities, compared to firms headquartered 
in the EU. This indicates that Japanese firms active in those areas, are strong in R&D&I compared to firms 
headquartered in other areas. Only in the industry sector, EU companies are performing better than Japanese 
firms in terms of their patent activities. EU companies which are active in both areas, steel and chemicals, 
are strongest compared to other regions, in terms of innovative output. 

Additionally, we compiled a list of noticeable co-applicants.6 Patent co-applications can – after triangulation 
with  additional  analyses,  especially  company  publications  –  be  considered  as  indicators  for  potentially 
existing GINs. In sum, in the mobility and batteries sector, patent co-application between European, Asian 
and US firms seems to appear quite frequently. Furthermore, taking all identified sectors into account, one 
of the co-applicants often is a prominent research institution, such as the French CEA and CNR or the German 
Max-Planck-Gesellschaft, while the other co-applicant is a major industrial player. 

2.4  Publication analysis 

The publication analyses served two goals. First, we focussed on identifying the top-30 global companies 
and their scientific publications in the COR&DIP database. Secondly, we zoomed in on the overall scientific 
publications carried out by the top-20 EU players, also looking at their overall investments in R&D. This two-
step approach allowed us to support the decision-making on the case study stakeholders selected, which 
are  predominantly  EU  companies,  while  leaving  room  to  detect  important  players  for  the  internationally 
oriented part of the in-depth case studies and company analysis. 

6 The number of patent co-applications is generally rather low, signifying that a quantitative analysis would 

be here of only limited additional value.  

Jan-22  
14 

38312519272117151414313544534615219121413130102030405060Industry (chemical & steel)EnergyMobilityBatteriesHydrogenEUUSJapanChinaRoW 
 
     
 
 
                                                                                                                           
 
 
 
                                           
Our approach  was  performed based on the COR&DIP  database, that contains information on the R&D&I 
activity  and  IP  assets  (i.e.,  patents)  of  the  top  2000  corporate  R&D  performers  worldwide,  as  well  as 
bibliometric data. Counts of scientific publications are from Elsevier’s Scopus® database. Relying on the so-
called All Science Journal Classification (ASJC) and departing from the Green Deal priority areas (energy, 
industry, mobility, hydrogen and batteries), we were able to identify the most relevant scientific fields for 
the European Green Deal.7, 8  

The analysis then zooms in on the top-20 European players in order to support the selection of European 
centric case  studies. For this, we present, in addition to the publication activity, the  relationship with the 
overall R&D investments for these players. 

Companies such as Volkswagen (DE), are recurrent, and particularly evident due to high amounts of R&D 
investments  in  the  indicated  period,  however  the  number  of  publications  is  not  particularly  high  by 
comparison to the specialists in the field. Despite comparable small R&D investments, Royal Dutch Shell 
(GB/NL) stands out as a player with particularly high number of publications, especially in the area of energy-
related publications, as well as hydrogen-related publications. In industry, Umicore (BE) and Siemens (DE) 
show significant numbers of publications alongside Eaton Corporation (IE) and Robert Bosch (DE). In the area 
of  mobility-related  publications,  companies  such  as  Thales  (FR),  Volkswagen  (DE)  and  Daimler  (DE)  are 
evidently active compared to the remainder, however BMW (DE) and Renault (FR) are also present in the 
top-20. In addition, in the area of hydrogen-related publications, BASF (DE) and Royal Dutch Shell (GB/NL) 
together with L’Air-Liquide (FR) are also evident players in the list, with the latter with comparably lower 
R&D investments. Overall, the results present companies that have both the practice to publish in scientific 
journals and  do  so also in the relevant classified areas that can  be associated with the Green  Deal and 
hence  the  proposed  companies  can  be  considered  as  particularly  active  in  innovation  and  interesting  to 
explore further in the further analysis of the GINs.  

2.5  Textmining 

The aim of the text mining was to verify and complement findings resulting from the other analyses. We 
used the UN’s Sustainable Development Goals (SDGs) as basis and matched corporate reports against SDGs 
to answer the question of how much topics covered by the SDGs are reflected in the company reports. To 
this end, we applied a bag-of-words approach.9 To focus on SDGs which are of especially high interest to 
JRC, we concentrate on the following SDGs:  

SDG8: 

SDG9: 

Promote  sustained,  inclusive  and  sustainable  economic  growth,  full  and  productive 
employment and decent work for all, 

Build  resilient  infrastructure,  promote  inclusive  and  sustainable  industrialization  and 
foster innovation, 

SDG12: 

Ensure sustainable consumption and production patterns, as well as 

SDG13: 

Take urgent action to combat climate change and its impacts. 

7 Certain ASJC subfields were not able to sufficiently capture the typical key players associated with the field, 
as the granularity of the ASJC field does not match well with the scope of the Green Deal priority area. 
In the area of hydrogen, several companies appear that do not seem to have a direct link to hydrogen. 
Similarly, batteries are related to ASJC subfields on materials and chemistry, however this is not to say 
that the publications detected in this area are exclusively dealing with battery technology development. 

8 For more detail, see Deliverable 2.  
9  The  bag-of-words  method  is  frequently  used  in  text  mining,  natural  language  processing  and  document 
classification.  It  signifies  that  all  cleaned  words  –  i.e.  conjugations  and  declinations  being  removed  – 
occurring  in  a  document  are  put  in  an  unsorted  “bag”  or,  in  more  technical  terms,  a  document-term 
matrix, where their occurrence is counted. Inside this “bag”, only their (relative) frequency matters, while 
the order of words does not. To implement the text mining, we used R (especially the quanteda package 
for text mining, see Benoit et al. 2018, as well as the tidyverse collection of R packages, see Wickham & 
Grolemund 2017). 

Jan-22 
15 

As a text base for each of the chosen SDGs, we used the “Progress & Info” texts for the years 2016 to 2019, 
as well as the presentation of targets and indicators for each SDG, as provided on the official UN website10. 
As a  text  base  for  the  company  reports,  we  opted  for  analysing  annual  reports instead  of  sustainability 
reports.11 We selected a large set of companies in each of the three main Green Deal priority areas (industry, 
mobility and energy), including in total more than 120 annual company (sub-) reports. 

Both SDG texts and company reports were cleaned and analysed using the quanteda package for R (Benoit 
et al. 2018). Cleaning included the removal of stopwords and stemming. 

To  match  SDGs  against  company  reports,  we  calculate  Cosine  similarity  between  normalized  document-
term matrices. Cosine similarity is a measure of similarity frequently used for text mining and takes into 
account the frequency with which words appear in each text document.12 Normalization accounts for varying 
document lengths.   

1.  As  a  first  step,  we  analysed  which  of  the  chosen  four  SDGs  appear  more  prominently  in  the 
corporate reports. To answer this question, we compared the distribution of Cosine similarities for 
each SDG across all documents and industry sectors. SDG8 (economic growth) is the SDG most 
reflected in the company reports (median Cosine similarity of 0.27). This is not surprising, as 
company  reports  mostly  deal  with  economic  activity  and  economic  growth.  SDG13  (climate 
change) is the SDG least reflected in the company reports (median Cosine similarity of 0.22), 
while  SDG12  (consumption  and  production,  median  Cosine  similarity  of  0.26)  and  SDG9 
(infrastructure  and  industrialization,  median  Cosine  similarity  of  0.23)  rank  in  the  middle.  The 
results  could  be  interpreted  as  a  first  (though  weak)  indicator  that  climate  change  mitigation, 
central to Europe’s Green Deal, still needs to seize a more prominent relative place in companies’ 
annual reports and business agendas.  

2.  As  a  second  step,  we  analysed  the  extent  to  which  the  reflection  of  the  selected  SDGs  in  the 
company reports varies by industry and world region. For this end, we focussed on companies with 
headquarters in the EU, the US and Japan, as company reports of companies located elsewhere 
(China, RoW) often differ considerably in their structure and language. 

Reference  to  SDGs  is  somewhat  lower  in  the  mobility  sector  than  in  the  industry  and  energy 
sectors.  In  the  industrial  sector,  within  the  EU  the  similarity  is  highest  for  SDG12  (consumption  and 
production) and SDG8 (economic growth). This indicates that commercial success is an important target for 
companies,  especially  in  direct  comparison  to  the  other  SDGs.  In  the  EU  energy  sector, SDG8  (economic 
growth) and SDG12 (consumption and production) are  highest compared to other world regions, but still 
comparatively lower compared to the industry sector.  

10  All  texts  published  on  https://sustainabledevelopment.un.org/sdg8;  https://sustainabledevelopment.un.org/sdg9; 

https://sustainabledevelopment.un.org/sdg12; https://sustainabledevelopment.un.org/sdg13    

11  Sustainability  and/or  responsibility  reports  focus  by  their  very  nature  on  issues  related  to  sustainable 
development.  This  circumstance  makes  it  difficult  to  assess  the  importance  companies  attribute  to 
sustainability  relative  to  other  issues  (such  as  financial  and  other  performance  indicators,  important 
achievements and future plans of the company etc.). By looking at annual reports instead of sustainability 
reports, it becomes possible to assess the relative weight attributed to sustainability.  

Furthermore, annual reports compared to CSR / sustainability reports follow specific reporting standards. The 
International financial reporting standard (IFRS) is used as accounting standard for consolidated financial 
statements  within  the  EU,  the  United  States  Generally  Accepted  Accounting  Principles  (US-GAAD)  are 
foundation in the US. Therefore, company reports follow specific rules regarding necessary content and 
their structure which simplifies their comparison with one another, especially regarding the identification 
of consistencies regarding the SDGs. 

12 For an excellent explanation of different similarity measures, see https://towardsdatascience.com/overview-of-

text-similarity-metrics-3397c4601f50  

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3. 

In a third step, we examine temporal developments in the reference to SDGs in company reports.13 
Reference to SDGs has increased over time for all considered SDGs except for SDG8 (economic 
growth),  which  remains,  however,  the  SDG  most  reflected  in  the  company  reports.  Especially 
reference  to  SDG12  (consumption  and  production)  and  SDG13  (climate  change  mitigation)  has 
increased  over  the  recent  years.  An  increase  can  be  generally  seen  as  positive  in  terms  of  the 
relative weight attributed to sustainability. It remains important to keep in mind, however, that the 
analysis  is  only  based  on  texts  (i.e.  companies’  own  statements,  which  are  easier  to  adjust  to 
changing  expectations  of  the  audience)  and  not  company  activities.  Triangulation  with  other 
analyses reflecting company activities (e.g.  patent and Scoreboard analysis) remained therefore 
central. 

4.  Finally,  we  analysed  which  EU  companies  have  reports  that  reflect  the  selected  SDGs  most.  A 
number of companies that appear in the top were also ranked high in the patent analysis  – this 
was a factor considered for the selection of the case studies.  

13 To make a valid comparison, we only apply within-company comparisons, meaning that we compare earlier 
reports with the most recent reports from the same company. Using this approach allows us to take into 
account varying reporting tradition across companies. 

Jan-22  
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3  Characterisation and assessment of Global Innovation Networks 

(GINs) along the Green Deal priority areas 

Global Innovation Networks are networks of industry actors and other stakeholders such as academia and 
public institutions that facilitate and/or promote innovation. Their value becomes apparent when they allow 
an understanding of e.g. firms’ relocation decisions or their choice of public-private partnerships. GINs exist 
within  their  Global  Value  Chains  (GVCs),  where  R&D&I  processes  are  becoming  more  and  more  widely 
dispersed, and this dispersion is occurring more and more quickly (Dosso, Potters, & Tübke, 2017).  

GINs provide a comprehensive understanding of innovation drivers and hampers. GINs allow for a historical 
as well as projective analysis of companies’ locational, operational, and strategical choices and their position 
in GVCs (Herstad et al., 2014; Dosso, Potters & Tübke, 2017). Unfortunately, comprehensive and actionable 
research of how GINs can contribute towards a greener economy are lacking, and hence this study aims to 
tackle this research gap. 

Following this definition, we propose to define key building blocks of the GINs related to the Green Deal. 
These also served as key elements to select the case studies, including the following:  

-  Background information  

-  Characterisation of the networks and involved actors14 

-  Key enabling technologies and technological maturity  

- 

Potential for growth 

Thereafter, we provide detailed information on the GINs we interviewed and their potential to contribute to 
the Green Deal. Here, we will first focus on the specific technologies the networks are performing R&D&I in, 
before focussing on a more macro level of GINs and their potential to contribute to the Green Deal.  

The  following  chapter  aims  to  state  both  literature  and  empirical  based  evidence  on  the  economic 
competitiveness of actors in the three identified Green Deal priority areas industry (steel and chemistry), 
energy and mobility on both regional and company level. Further, we will merge this information with insights 
obtained from ten case studies that are based on interviews we conducted with experts in the Green Deal 
priority areas. We also identified two cross-sectional technologies with the potential to accelerate the 
carbonisation of the European industry, that are integrated with the Green Deal priority areas: hydrogen and 
batteries. Hydrogen is produced within the energy sector and is used as source of energy by the mobility 
and the industrial sector. Vice versa, the industry is a producer of batteries that are used for energy storage 
in the energy and mobility sectors 

The  development  of  new  technologies,  sustainable  or  conventional,  is  linked  to  R&D&I  efforts  of  the 
respective actors (Dernis, et al., 2015). Hence, analysing the distribution of companies that are investing the 
largest sums of R&D depicted in the EU Industrial R&D Investment Scoreboard provides a first indication on 
the distribution of R&D investments per Green Deal priority area and per region (Figure 5).  

Figure 5: Number of companies in the Scoreboard by region and Green Deal priority area   

14 Results are based on expert interviews and desk research complementing information on specific networks. 
The results therefore provide only additional information and limited generally valid conclusions for the 
specific Green Deal priority areas.  

Jan-22  
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Source: VDI TZ based on 2019 EU industrial R&D investment Scoreboard  

As seen in Figure 5 most companies (with a sum of 401) operate in the industrial sector, followed by the 
mobility sector (171 firms) and the energy sector (81 companies). Most companies are EU firms (1,147 out 
of 3,288 in total) in both Green Deal priority (240 out of 653 companies) and other areas (the latter not 
illustrated here), showing a clear EU dominance in the industrial and especially in the energy sector.  

The  following  chapters  provide  detailed  information  on  the  competitiveness  of  innovation  activities  and 
innovative competitiveness in the three Green Deal priority areas and the cross-sectional technologies. The 
analysis focusses on consistent indicators both on input  and output level, such as R&D investments and 
patenting  activities  (Dernis,  et  al.,  2015).  To  complement  the  results,  we  add  analysis-based  results  on 
additional sources such as investment data in small companies based on the Crunchbase15 database and 
supplement the results with insights from the case studies.  

3.1 

Industry  

Background  

The industrial sector takes third place in terms of EU GHG emissions in 2018, following the energy supply 
and  transport  sector  (European  Energy  Agency,  2019).  Hence  decarbonizing  the  industrial  sector  by 
simultaneously maintaining job security is an important issue in transforming the industry. Within this sector, 
we  identified  two  main  subsectors,  namely  steel  and  chemicals,  that  are  important  actors  in  both 
contributing to EU GDP and EU CO2 emissions. Due to data gaps, some of the analyses presented in the 
following provide results on an aggregated level, industry, while other analyses focus on both subsectors 
(chemistry and steel). In 2015, the steel sector directly emitted 190 and chemistry emitted 128.4 CO 2 eq. 
emissions in the EU (see Figure 6).  

High  energy  consumption  is  a  main  contributor to  the  industrial  sector´s  high  emissions  level.  So-called 
Energy-Intensive  Industries  (EIIs)  are  responsible  for  15%  of  Europe’s  overall  GHG  emissions.  To 
decarbonise  these  EIIs,  funding  and  market  creation  remain  important  factors  to  support  innovation 
activities forwarding the transformation.  

Generally, the decarbonisation of EEIs involves the adoption of the following emission reduction pathways: 

- 

- 

- 

- 

Energy efficiency and process integration 

Switching to alternative fuels and feedstocks with a high greenhouse gas abatement potential 
(hydrogen, biomass, etc.) 

Electrification  

Hydrogen-based-processes 

15 https://www.crunchbase.com/  

Jan-22  
19 

14640545693273133577724491226020406080100120140160IndustryEnergyMobilityNumber of companies in the Scoreboard by region and Green Deal priority areaEUUSJapanChinaRoW 
 
     
 
 
                                                                                                                           
 
 
 
                                           
- 

- 

- 

Carbon capture, utilisation and storage (CCUS) 

Recycling, materials efficiency and circular economy 

Adoption  of  industrial  symbiosis  techniques,  with  a  higher  valorisation  of  waste  streams  and 
material efficiency 

Figure 6: Evolution of GHG emissions across selected EIIs and the EU as a whole 

Source: VUB-IES, 2018 

Looking at the overall value added for the economy, it can be seen that within the EU-27 the most important 
manufacturing  sectors  are  machinery  and  equipment,  motor  vehicles,  trailers  and  semi-trailers,  food 
products,  fabricated  metal  products  and  chemicals  and  chemical  products  (Eurostat,  2017).  The  zero-
pollution action plan of the Commission aims to reduce harming substances in air water and soil. Specific 
measures will address micro-plastics and pharmaceuticals, as well as chemicals, with the launch of a new 
chemical’s strategy for sustainability and a toxic-free environment. 

To identify the growth potential of the industrial sector16 and derive competitive positions both on regional 
levels, we provide results on the regional distribution of the number of companies active in this sector. The 
2019 EU Industrial R&D Investment Scoreboard lists the top-2500 R&D investing companies worldwide. Of 
these 2500 companies, 401 are operating in the industrial sector. Together the EU, that accounts for one 
third of all companies in this sector in the Scoreboard, and the US with 56 companies in total, share 50 
percent  of  the  companies  in  the  industrial  sector  (Figure  7).  More  specific,  50  percent  of  the  top  R&D 
investing companies in this sector can be assigned to the EU and US market. The regional distribution of 
companies within the EU is highly concentrated on a few major actors located in Western Europe, mainly 
Germany but with the UK and Sweden following. Chinese (77) and Japanese companies (73) are strongly 

16 Due to data restrictions for some analyses aggregated results of the industrial sector will beprovided. For 

other analyses, we were able to analyse the chemical and steel sector separately.  

Jan-22  
20 

 
 
     
 
 
                                                                                                                           
 
 
 
 
                                           
represented in the industrial sector as well. Regarding spatial distribution of highly R&D investing companies, 
the EU has a good competitive position but regions like China and Japan are important actors as well. 

Figure 7: Number of Scoreboard companies by country, Industry  

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard 

Characterisation of the networks and involved actors 

Based on prior analyses, we identified relevant companies in the industrial sector that are powerful actors 
in their individual sectors. We were able to conduct interviews with three MNEs. Two of them are operating 
in the chemical sector and a third company is a Global materials technology and recycling company. 17  

Both chemical companies are headquartered within central Europe, France and Germany, and are active 
in many networks. The project-based networks consist of either nine partners from six different countries 
(of which five are EU countries, see  

Figure 8: Graphical illustration of the 
Global Innovation Network, MNE 2 

Figure 9: Graphical illustration of the 
Global Innovation Network, MNE 3 

Source:  VDI  TZ,  based  on  interviews 
and  additional  research.  EU  member 
states  (EU27)  in  blue.  For  a  better 
overview  there  is  just  one  line  per 
country even though in practice there 
are usually several actors involved on 
the country level. 

Source:  VDI  TZ,  based  on  interviews 
and additional  research.  EU  member 
states  (EU27)  in  blue.  For  a  better 
overview  there  is  just  one  line  per 
country even though in practice there 
are usually several actors involved on 
the  country  level.  Grey  line  indicates 
USA. 

17 Although the focus in this chapter is mainly on chemicals and steel, it was unfortunately not possible for us 
to schedule an interview with outstanding steel companies. Instead, in this sub-chapter the focus is on 
chemicals as well as materials and recycling. 

Jan-22  
21 

DE53GB20SE15FI10FR9BE8EU other countries31US56JP73CN77CH16KR10IN6RoW other countries23Number of Scoreboard companies by region, IndustryEU total40EU total40EU total40EU total40EU total40EU total40EU total40EU total40EU total40EU total40EU total40EU total146 
 
     
 
 
                                                                                                                           
 
 
 
 
                                           
) or ten partners from nine different countries (of which eight are EU countries, see Figure 9). The networks 
include profit entities as well as RTOs and universities in one case. Stakeholders in these networks usually 
combine the diversified knowledge and skill set, that is crucial for R&D&I processes in the chemical fields. 
Here,  one  stakeholder  e.g.  does  basic  research  whereas  other  stakeholders  contribute  with  theoretical 
background and simulation as well as field experimentation. More specifically, large companies contribute 
with  broad  knowledge,  network  structure,  logistics  and  resources,  whereas  SMEs  contribute  with  more 
specialized and in-depth knowledge concerning specific tasks. In general, high diversity in a network is seen 
as a benefit. The interviewee themselves, for instance, provides knowledge and resources in the hydrogen 
sector. 

The Global materials technology and recycling company (Figure 10) has its headquarters in Belgium 
and has a large focus on sustainable technologies. Innovative activities here are based on a mix of in-house 
expertise  and  networks.  Exemplary  for  an  essential  network  in  the  material  and  recycling  sector  is  the 
European Institute of Innovation and Technology (EIT) Raw Materials18, that is established in so-called co-
location centres (CLCs), which are regionally organised innovation hubs. The network brings together 317 
actors from 33 European countries, of which 28 are EU members. The financial resources are built on funding 
through the institute as well as membership fees of stakeholders, who can in turn apply for specific projects. 
The composition in this network is highly diverse, spanning from universities to large companies operating 
in the materials sector. Which member is working at which project highly depends on the topic and the skill 
set of stakeholders. By participating in this network, larger companies have access to collaborations with 
RTOs and SMEs. Latter are included to transfer projects that have reached higher TRL level into start-up 
activities and support the start-up phase of companies, whereas RTOs contribute by basic research in their 
specified focal point (such as mining or recycling, for instance). In general, being organized in this network 
helps  to  address  cross-cutting  questions  (primary  supply  /  mining,  material  science,  use  and  energy 
efficiency,  recycling,  social  dimension,  etc.),  and  is  hence  important  for  promotion  and  development  of 
recycling and materials topics.  

18 https://eitrawmaterials.eu/ 

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Figure  8:  Graphical  illustration  of  the  Global  Innovation  Network, 
MNE 2 

Figure 9: Graphical illustration of the Global Innovation Network, MNE 
3 

Source:  VDI  TZ,  based  on  interviews  and  additional  research.  EU 
member states (EU27) in blue. For a better overview there is just 
one  line  per  country  even  though  in  practice  there  are  usually 
several actors involved on the country level. 

Source:  VDI  TZ,  based  on  interviews  and  additional  research.  EU 
member states (EU27) in blue. For a better overview there is just one 
line  per  country  even  though  in  practice  there  are  usually  several 
actors involved on the country level. Grey line indicates USA. 

Jan-22                                                                                                                            23 

 
 
     
 
 
 
Figure 10: Graphical illustration of the Global Innovation Network, MNE 4 

Source: EIT Raw Materials, https://eitrawmaterials.eu/about-us/ 

Jan-22                                                                                                                            24 

 
 
     
 
 
 
 
 
Key enabling technologies and technological maturity 

Relevant technologies and solutions that can help decarbonize specific sectors in the EIIs are listed in Figure 
11.  In  both  analysed  subsectors,  biomass  solutions,  the  use  of  green  hydrogen  and  the  industrial 
transformation from linear towards circular industrial economy play key roles in decarbonising these sectors. 
Additionally, Carbon  Capture  and Storage  (CCS)  is regarded  a  promising  technology  in  decarbonising  the 
steel production. 

Figure 11: Key decarbonisation solutions by sector 

Source: IRENA, 2020 

Analyses of tech start-ups active in the steel sector allow to draw conclusions about interfaces with highly 
policy relevant industries that can lead to synergy effects. Based on data from the Crunchbase database, 
we identified 225 enterprises operating in the steel sector. This relatively small number of start-ups implies 
high  capital  intensity  and  high  fixes  costs  that  act  as  market  barriers.  Seventeen  steel  start-ups  (7.56 
percent) are also active in policy relevant fields: 

-  12 in KETs (9 in advanced materials, 2 in biotech, 1 in nanotech) 

-  4 in advanced manufacturing technologies (all 3D-printing) 

-  1 in key and emerging software technologies (Quantum computing). 

The largest focal point can be found in the KET area, especially within advanced materials, and advanced 
manufacturing technologies. One example for a start-up that connects the technologies of bio- and nanotech 
with  the  steel  sector  is  a  supplier  for  instruments  whose  work  will  help  enabling  sustainable  chemistry 
production to production plants and laboratories, e.g. in the steel industry.19  

According  to  the  Strategic  Forum  on  Important  Projects  of  Common  European  Interest  (2019),  for  the 
chemical sector to transform into a low CO2-emissions industry, technologies on each link of the value 
chain must be adjusted, namely 

- 

- 

- 

input level: use of alternative carbon feedstock like CO2 and waste and use of electricity 

production process: use advanced processing and new technologies such as chemical valorisation 
of CO2, chemical waste recycling, use of PtH and PtC technologies 

outputs: low carbon chemicals, plastic from a circular economy / recycled plastics or e-chemicals 
and e-fuels 

19 Information obtained from company description in the Crunchbase database.  

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Furthermore,  the  future  of  the  chemicals  industry  in  Europe  is  strongly  intertwined  with  the  future  of 
hydrogen technology (European Chemical Industry Council, 2019).20 

Both steel and chemistry are part of the EIIs, but feature different structures. In contrast to the steel sector, 
chemical tech start-ups appear almost twice as often (431 times) in the Crunchbase database than steel 
enterprises. Matching these with start-ups also operating in the identified policy relevant fields indicates 96 
companies active across the board. This corresponds to 22.3 percent of the start-ups indicating high synergy 
effects between the chemical and other sectors, namely: 

-  93 start-ups in KET (66 in Biotech, 15 in advanced materials, 12 in Nanotech) 

-  2 start-ups in Key and emerging software technologies (one in AI, one in IoT) 

-  One start-up operating in advanced manufacturing technologies (3D-printing) 

With 22.3 percent of tech-ups also operating in highly policy relevant fields, the chemical sector has the 
highest  share  of  all  Green  Deal  priority  areas.  Further,  a  clear  intersection  with  KET,  especially  Biotech 
solutions,  exists.  These  quantitative  results  strengthen  the  outcomes  obtained  by  the  literature  analysis, 
mainly that biobased solutions in the chemical sector play a crucial role in the transformation. This trend is 
already taking place in the areas chemical start-ups are operating in. As example one start-up listed in the 
Crunchbase database is, among other fabrics, using resin as a feedstock for the polymer industry, combining 
biobased, alternative feedstock with the plastics industry. 

Potential for growth  

To identify the growth potential of the industrial sector, we cross-check results of innovation indicators of 
both input level, such as R&D investments and number and trend of employees, and output level such as 
the number of patents granted in the industrial sector. We will then continue to add information on the trend 
of newly founded tech start-ups operating in the chemical and steel sector. 

To get information on the distribution of top-100 patenting firms in the industrial sector, we searched the 
PATSTAT  database.  Among  these  top  patenting  firms  in  the  industrial  sector,  EU  companies  are  most 
frequent  (38  firms),  followed  by  Japanese  (31  firms)  and  US  (21)  companies.  Nine  firms  have  their 
headquarters in RoW, whereas only one of the top-patenting companies in the industrial sector is a Chinese 
company. EU companies which are active in the industry sector are strongest compared to other regions, in 
terms of patents, i.e. innovative output. 

The EU Industrial R&D investment Scoreboard registers data on the R&D investments of companies. For 
the industrial sector analysed here, numbers of R&D expenditures on country level and company level as 
well as data on R&D intensities will be presented.  Figure 12 graphically shows the regional distribution on 
total R&D investments for the relevant world regions identified; EU, US, China, Japan and other countries 
(aggregated as RoW here). A comparison of all areas regarding their temporal development shows that the 
total R&D investment in the industrial sector has been (slightly) increasing between 2009 and 2018. On 
country  level,  total  R&D  investment  is  highest  in  the  EU,  followed  by  Japan.  The  US  and  Japan  show 
investment rates on a regional level, whereas Chinese companies invested only a fraction of the spending 
of other regions back in 2009, but increased their investment by the factor 6.7 by 2018 and overtook the 
US and Japanese R&D investments in 2018.   

20 More detailed information provided in chapter 3.4 of this deliverable: Cross-sectional technologies.  

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Figure 12: Total R&D investment by region, Industry (in EUR Mio.) 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

Unlike  total  R&D  investments,  mean  R&D  investments  were  calculated  by  aggregating  the  total  R&D 
investments  in  the  industrial  sector  in  shares  of  number  of  companies  listed  in  this  sector.  Adding 
information  on  mean  R&D  investments  gives  information  on  the  competitive  position  of  regions  on  a 
company level. Analysing the industrial sector´s mean R&D expenditures in demonstrates that Japan has 
the highest shares on company level, followed by the RoW, the US and the EU afterwards. Again, China had 
the lowest account in 2009 but shows an increasing trend and almost reached the EU level in 2018. On 
average, Japanese top R&D investing  companies in the industrial sector invested about 124 Mio. EUR in 
2009 and increased this amount to 169 Mio. EUR in 2018, whereas an average Chinese Scoreboard company 
in this sector spend 26 Mio. EUR on R&D in 2009, which more than tripled in 2018, exhibiting 93 Mio. EUR.  

The R&D intensity (Figure 13) was calculated by dividing the total R&D investment by net sales for each 
region and sector. The second highest dispersion of all Green Deal priority areas in terms of R&D investments 
can be found in the industrial sector, ranging from China showing the lowest R&D intensity in 2010 to the 
EU in 2018. Similar to total and mean R&D investments, Chinese companies have strongly increasing trends 
in their R&D investments, whereas Japan, RoW and the US showed a stable, slightly volatile trend. Except 
for the EU, all other main regions followed similar trends in their R&D intensities between 2009 and 2017, 
indicating regionally spanning trends in the industrial sector. EU companies in the industrial sector have the 
highest R&D intensity, followed by Japan (with a maximum of 0.043 in 2009), the aggregate RoW (with a 
maximum of 0.035 in 2017), the US and China.  

Jan-22  
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02.0004.0006.0008.00010.00012.00014.00016.0002009201020112012201320142015201620172018Total R&D investment by region, Industry (in EUR Mio.)EUUSJapanChinaRoW 
 
     
 
 
                                                                                                                           
 
 
Figure 13: R&D intensity by 5 main regions, area industry (shares) 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard. Lines (here US, Japan, China and 
RoW values) belong to the left-hand axis, bars (here EU values) to the right-hand axis. 

The development of newly funded start-ups allows to draw conclusions on the relevance of specific sectors. 
Further, it can provide implications on the level of competition and give indications on market barriers, e. g. 
due to high fixed costs.  

Figure 14: Number of foundations per year, steel sector  

Source: VDI TZ, based on Crunchbase Database (2020) 

About one third of all companies in the steel sector have been founded between 2000 and 2008 (Figure 
14), according to queries of the Crunchbase database21. The number of new start-ups was highest in 2010, 
in the aftermath of the financial crisis. Compared to other sectors, the total number of companies as well 
as the number of recently founded companies is relatively low, indicating high market-entry barriers (e. g. 
high fixed costs) exist in the steel market. 

According to the Crunchbase database, the total amount of funding (worldwide) in the steel sector adds up 
to 2.85 Billion USD, of which EU tech start-ups in total received the largest amount, followed by the US and 
China, indicating the EU is well positioned. On a company level, on the other hand, Chinese companies on 
average  receive  by  far  more  funding.  To  transform  young  and  small  start-ups  to  value-generating 

21  Here  and  in  the  following  analyses  based  on  the  Crunchbase  database,  we  consider  only  companies  for 

which data is available. Hence, there exists a reporting bias which has to be considered. 

Jan-22  
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0246810122000200120022003200420052006200720082009201020112012201320142015201620172018Anzahl Startups00,10,20,30,40,50,600,0050,010,0150,020,0250,030,0350,040,0450,052009201020112012201320142015201620172018R&D intensity -area Industry EUUSJapanChinaRoW 
 
     
 
 
                                                                                                                           
 
 
                                           
companies and to bring innovative ideas into the market, it is necessary for start-ups to receive enough 
capital. Average amounts per company are an informative key figure and future performance indicator.  

Figure 15: Total and average amount of funding (Mio. USD), steel sector 

Source: VDI TZ, based on Crunchbase database (2020)  

Contrary  to  the  steel  sector,  the  number  of  start-ups  operating  in  the  chemical  sector  listed  in  the 
Crunchbase database equals 431 and is significantly higher, indicating lower market barriers compared to 
steel. 55 percent of these companies are younger than 20 years (Figure 16), showing an increasing, but 
volatile trend that reveals increasing competition within the chemical sector. 

Figure 16: Number of foundations per year, chemical sector 

Source: VDI TZ, based on Crunchbase database (2020) 

As to funding, US companies receive significantly high amounts of funding on both regional and company 
level, acquiring more than two thirds of worldwide funding in chemistry.   

Jan-22  
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05101520252000200120022003200420052006200720082009201020112012201320142015201620172018Anzahl Startups 
 
     
 
 
                                                                                                                           
 
 
 
 
Figure 17: Total and average amount of funding (Mio. USD), chemicals sector 

Source: VDI TZ, based on Crunchbase database (2020) 

In  terms  of  patenting  and  total  R&D  investments  on  an  aggregated  country  level,  the  EU  has  a  strong 
competitive  position  in  the  industrial  sector.  The  analysis  of  R&D  intensities  gives  similar  results  on 
company level. Accordingly, Japan is also a strong competitor, when taking these indicators into account. 
Analyses  on  company  level  give  different  results,  indicating  that  there  are  few  companies  with  strong 
research interests in Japan and RoW, respectively. Zooming in at the steel sector, the EU is well positioned 
on a regional level, but Chinese companies are financially well equipped and  can be  strong competitors. 
Further,  the  relatively  low  number  of  companies  indicates  high  market  barriers  due  to  high  fixed  costs 
(powerplants, machinery etc). US start-ups have a better standing in the  chemical sector, receiving the 
most funding.  

3.2  Energy 

Background  

Energy has a key role in transforming the current economic system into a sustainable system and thus is 
an important sector. Energy is essential in daily life, and due to an ever-increasing global population, coupled 
with  global  economic  growth,  the  demand  for  energy  is  constantly  increasing.  Based  on  a  report  of  the 
European Technology and Innovation Platform on Strategic Networks and Energy Transition (ETIP SNET), the 
energy  system  can  be  broken  down  into  energy  generation  (supply),  and  energy  consumption  (demand), 
which is accompanied by energy networks (infrastructure) to transport and store energy (ETIP SNET, 2018).  

Relating  to  the  energy  sector,  the  European  Green  Deal  includes  the  following  actions  to  be 
undertaken in order to make its ambitions reality: 

- 

- 

Interconnect energy systems and better link / integrate renewable energy sources to the grid 

Promote innovative technologies and modern infrastructure 

-  Boost energy efficiency and eco-design of products 

-  Decarbonise the gas sector and promote smart integration across sectors 

- 

- 

Empower consumers and help Member States tackle energy poverty 

Promote EU energy standards and technologies at global level 

-  Develop the full potential of Europe’s offshore wind energy 

- 

End subsidies for fossil fuels  

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Global changes in energy production and demand will have a significant impact on geopolitics and industrial 
competitiveness.  Referring  to  this,  the  regional  distribution  and  the  actors´  current  strength  and  future 
developments are important indicators.  

Figure 18: Number of Scoreboard companies by country, Energy 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

In  the  selection  of  top-2,500  R&D  investing  companies  depicted  in  the  EU  Industrial  R&D  investment 
Scoreboard, important energy companies are distributed as seen in Figure 18. 81 energy companies are in 
total listed in the EU Industrial Scoreboard. Compared to the other sectors this figure is relatively low which 
indicates high market barriers due to high fixed costs. Almost 50 percent are European companies, followed 
by Japan, the US and China. The inner-European distribution of companies in the energy sector is relatively 
equally distributed: No regional clustering within this sector can be found.22  

For the energy sector, we have been able to compare conventional and non-conventional electricity 
and  energy.23 This approach  allows to draw  conclusions about chances and opportunities regarding the 
Green Deal and sustainability. Operating profit indicates how well companies, and on aggregated level a 
whole industry, can use their core operations to generate revenues. Analyses show profits are higher for 
conventional (Figure 20) than for green energy (Figure 19). The US generates the highest mean operational 
profit in the renewable energy sector (3,418 Mio. EUR between 2009 and 2018), followed by the EU (1,526 
Mio. EUR), RoW (822 Mio. EUR) and China (520 Mio. EUR), which equals 6,288 Mio. EUR of operational profit 
in total. In direct comparison, the mean operating profit in the conventional energy sector is more than twice 
as high (14.8 Billion EUR). 

22  Regional  clustering  of  specific  industries  might  be  due  to  historical  reasons,  endowment  of  factors  of 
production,  infrastructure  or  further  reasons  that  can  lead  to  economies  of  scale  or  different  things. 
Regional clustering (up to a certain degree) often leads to comparative advantages of companies within 
these areas, in contrast to companies outside these clusters (Hill and Brennon 2000). 

23 The selection is based on the Industry Classification Benchmark (ICB, see FTSE Russell 2019) included in 
the scoreboard. The ICB branch itself is built up on “Alternative Energy” (ICB branch 0580), “Renewable 
Energy  Equipment”  (ICB  branch  0583),  “Alternative  Fuels”  (ICB  branch  0587)  and  “Conventional 
Electricity” (ICB branch 7535). 

Jan-22  
31 

FR7DE6GB6IT4DK3ES3EU other countries11US9JP13CN7KR3RoW other countries9Number of Scoreboard companies by region, EnergyEU total40EU total40EU total40EU total40EU total40EU total40 
 
     
 
 
                                                                                                                           
 
 
                                           
Figure 19: Mean operating profit, alternative energy and renewable energy equipment sector, in Mio. EUR 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

Figure 20: Mean operating profit, conventional energy, in Mio. EUR 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

EU  operating  profits  in  the  conventional  sector  have  decreased  over  time.  Contrary,  operating  profits 
generated by Chinese companies and companies headquartered in RoW have increased their profits over 
time. During the observed time period, Chinese companies have increased their average operating profit 
from 24 Mio. EUR to 1,021 Mio. EUR by about 4,000 percent.  

Characterisation of the networks and involved actors 

Based  on  previous  analyses,  we  identified  four  relevant  energy  companies  with  whom  we  conducted 
interviews. In order to get highly diverse results, we identified both an SME headquartered in Central Europe 
and MNEs based in Europe and Northern America.  

The European energy SME relies rather on strong ties with an OEM in order to organise innovation activities. 
The OEM itself is directly involved in Global Innovation networks. Where existing legislation does not outline 

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particular rules towards circularity or emissions reductions, the OEM is the decision maker. For the specific 
energy SME interviewed, collaboration in research related GINs involves typically the OEM, the company and 
a  Research  and  Technology  Organisation  (RTO)  who  can  help  with  the  research-specific  aspects  and 
developments.  

Whereas the SME is just starting to be present in Global Innovation Networks (GINs), MNEs in the energy 
sector are typically operating in multiple R&D&I networks. Internal and external R&D&I networks can exist 
within one company, depending on the skill set and resources available inhouse versus the opportunities of 
the collaborating externally.  

The R&D&I networks´ diversity is high. The energy companies interviewed are operating in multiple networks 
depending on their specialization within the energy sector. In the energy sector, R&D&I networks are often 
regulator-based and typically very established. The reasons for energy companies to become involved in 
these types of networks are very diverse. On the one hand, being organized in these types of organizations 
can be based on strategic decisions. On the other hand, membership in larger consortia as Hydrogen Europe 
or  BBI  JU  eases  engagement  with  other  stakeholders  and  thus  partnership  formation  or  to  follow  key 
developments on an EU level as well. On a lower TRL (technology readiness level) often RTOs are involved 
to perform basic research.  

On  a  spatial  level, the  networks´  scope  is also  very  diverse  and to  a  certain  degree  correlated  with  the 
number  of  actors  involved.  The  composite  company  for  instance,  is  included  in  a  GIN  that  involves  the 
European company itself, the OEM and an RTO, all situated in different countries, in this case in Europe. The 
OEM is likely involved in other GINs such as WindEurope24 (Figure 21). Other networks like Hydrogen Europe 
consist  of  a  larger and  more  diverse  group  of  members,  industry, research  and  national  associations,  in 
Europe (like BBI JU, see Figure 22) and also neighbouring countries. 

24 https://windeurope.org/ 

Jan-22 
33 

Figure 21: Graphical illustration of the Global Innovation Network, SME 2 

Figure  22:  Depicting  the  BBI  JU  GIN:  Location  of  BBI  JU  projects,  partners, 
demonstration plants and flagship plants 

VDI TZ, based on interviews and additional research. EU member states (EU27) 
in blue. For a better overview there is just one line per country even though in 
practice there are usually several actors involved on the country level. 

Source: BBI JU, 2020 

Jan-22                                                                                                                            34 

 
 
     
 
 
 
Key enabling technologies and technological maturity 

In  order  to  implement  the  energy  transformation  from  fossil  fuel  based  to  sustainable  energy  within 
established  energy  companies,  these  companies  now  diversify  their  portfolio  to  become  broad  energy 
companies, e.g. deploy activities on batteries and alternative biomass subjects, hydrogen, among others.  

In 2018, the share of renewable energy (and fuels) of the total amount of energy produced in the EU was 
still relatively low, compared to the EU target (see Figure 23). 

Figure 23: Share of EU energy production by source, 2018 

Source: Eurostat, 2020b 

Transforming the established energy system from fossil-based energy towards sustainable produced energy 
therefore demands the development of further disruptive technologies. According to the Strategic Energy 
Technology  Plan  (so-called  SET  Plan),  the  five  prioritised  renewable  technologies  are  wind  energy,  solar 
photovoltaics  (PV),  ocean  energy,  geothermal  energy,  and  concentrated  solar  power  (CSP)  (European 
Commission, 2020h). Key areas for technological developments in the energy sector are identified by the 
SET and include integrating renewable technologies in the energy systems, reducing costs of technologies, 
new technologies and services for consumers, resilience and security of energy systems, new materials and 
technologies for buildings, energy efficiency for industry, competitiveness in global battery sector and e-
mobility,  renewable  fuels  and  bioenergy,  carbon  capture  and  storage  and  nuclear  safety  (European 
Commission, 2020f). 

Above  listed  literature-based  results  are  reaffirmed  by  data  from  the  Crunchbase  database  containing 
information on tech start-ups. We identified 12,911 energy companies in total, of which 577 companies 
that are also active in policy relevant fields, which equals a share of 4.5 percent.25  

- 

- 

The  majority  of  them  is  operating  in  the  KET  field.  Within  this  area,  203  enterprises  operate  in 
biotechnology, 45 in industrial nanotechnology and 38 in advanced materials 

The KET field is followed by key and emerging software technologies (286 enterprises), of which 
157 companies are operating in IoT followed by AI (94 firms), quantum computing and embedded 
systems in decreasing order  

25 The chemical sector, batteries and steel present a higher share of companies with policy relevant fields, 
indicating  higher  synergy  effects.  The  mobility  and  hydrogen  sector  have  lower  shares  compared  to 
energy.  

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-  36 companies are using advanced manufacturing (3D-printing) 

Potential for growth  

The  growth  potential  of  a  certain  sector  and  /  or  region  can  in  parts  be  monitored  by  analysing  output 
indicators, e. g. the number of patents as a proxy, or indicators that aim to monitor the input, such as R&D 
investment.  

Regarding  the  number  of  firms  among  the  top-100  patenting  firms in  the  energy  sector,  the  EU  ranks 
second behind Japan. In total, 31 out of the 100 top green patenting firms having headquarters in the EU, 
whereas 35 out of the top-100 patenting firms are headquartered in Japan. The US and the area RoW follow 
with 17 and 12 companies among the top 100-patenting firms, respectively. This signifies that Japanese 
top innovative firms are strong competitors in terms of their patent and hence R&D&I activities compared 
to firms headquartered in the EU. 

Analyses  of  R&D  investments  based  on  the  2019  EU  Industrial  R&D  investment  Scoreboard  provide 
evidence on the R&D competitiveness of specific regions in the energy sector.  

Figure 24: Total R&D investment by region, Energy (in EUR Mio.) 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

Between 2009 and 2018 the total R&D investment in the energy sector is constantly highest within the 
EU, followed  by  the  US, the  aggregate  RoW, Japan  and finally  China  (see  Figure  24).  The  latter and the 
aggregate RoW are the only regions demonstrating a positive trend in total R&D expenditures on country 
level, whereas the EU´s and the US´ total R&D investment reveal a decreasing trend since 2014. Considering 
the whole energy sector, the rising markets China and RoW increase their efforts whereas the established 
markets EU and US show decreasing trends on country level. 

On company level, the US has the highest average R&D investment per company with a maximum value 
of 385 Mio. EUR in 2014, followed by the aggregate RoW. The EU ranks third with a mean investment of 
151  Mio.  EUR  between  2009-2018.  China  is  the  only  country  with  an  increasing  trend  in  mean  R&D 
expenditures  raising  their  mean  investment  from  nine  Mio.  EUR  (2009)  to  106  Mio.  EUR  (2018)  almost 
reaching the EU level in 2018 (135 Mio.).  

Considering the entire time frame, US companies show the highest  R&D intensity in the energy sector. 
China follows with a total R&D intensity of 0.2 considering the complete time span, whereas The EU ranks 
third (0.15 in total). RoW (0.14) and Japan (0.07) follow in descending order, exhibiting decreasing trends. 

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Chinese companies show an increasing trend in R&D intensities from 0.01 in 2009 to almost 0.03 in 2018 
while the EU has a varying, slightly increasing trend.  

Figure 25: Number of employees employed by companies from 5 main regions, energy sector (in thousands, 
change) 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

The number of employees (displayed in Figure 25) employed by EU energy companies dropped by 20 percent 
and for RoW companies by seven percent between 2009 and 2018. US companies recorded a slight increase 
(3 percent), whereas Chinese energy companies increased their labour force in the by almost 700 percent. 
The total number of employees employed by Chinese Scoreboard companies in the energy sector still only 
amounts  to  about  one  third  of  EU  employees  in  the  energy  sector  in  2018,  based  on  the  industrial 
Scoreboard.  

Figure 26: Number of foundations per year, energy sector 

Source: VDI TZ based on Crunchbase Database (2020) 

In total, 7,322 of the 12,911 energy tech-start-ups listed in the Crunchbase database (i.e. 56 percent) have 
been founded between 2000 and 2018. Also, a clear trend can be detected: Being constant from 2000 to 
2003, the number of worldwide annual founding almost tripled from 2003 (211 start-ups) to 2009 (602 

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37 

180130723918217-20%+ 3%+ 0%+ 686%-7%144131623914320205001000150020002500300035004000EUUSJapanChinaRoWEmployees 2009Employees 201801002003004005006007002000200120022003200420052006200720082009201020112012201320142015201620172018Anzahl Startups 
 
     
 
 
                                                                                                                           
 
 
 
business  creations),  which  simultaneously  increased  the  competition  in  the  energy  market.  From  2009 
onwards, the number of new companies entering this sector decreased.26  

The funding on both country and company level is highest for US start-ups operating in the energy sector. 
Chinese  companies,  although  receiving  a  relatively  low  total  amount  of  funding,  generate  high  capital 
inflows from investors on company level. Hence, Chinese and US start-ups are strong competitors in the 
energy area.  

Figure 27: Total and average amount of funding (Mio. USD), energy sector 

Source: VDI TZ, based on Crunchbase database (2020) 

In the overall energy sector, the established regions US and EU still have a strong competitive position in 
terms of R&D&I. Lately, other regions like the aggregate RoW and especially China are catching up, both in 
terms of R&D spending and increasing their labour force in the energy sector. One important issue in the 
energy area is the type of energy produced. Alternative energy and renewable energy equipment will become 
increasingly important in the future. China and RoW lately increased their profits in  conventional energy 
(Figure 27), whereas the US and EU generated higher profits from sustainable energy businesses (be it direct 
production or primary and intermediate products).  

3.3  Mobility 

Background  

The mobility sector includes services of transporting goods and people, when vehicles and infrastructure are 
used to enable this movement. Overall, the transport sector has roughly 675 billion EUR Gross Value Added 
(GVA) and accounts for 5 percent of the GVA in the EU-28 in 2017. In the EU, transport accounts for 25 
percent of GHG in the EU-28 and thus transformations in this sector are key to unlocking the potential 
of  the  European  Green  Deal  (Eurostat,  2019).  Within  the  mobility  sector,  CO2  emissions  are  highest  for 
passenger  vehicles,  followed  by  other  road  transport  using  freight  vehicles,  aviation  and  shipping 
(International Energy Agency, 2019d). 

To support and accelerate the decarbonization within the mobility sector, transformations will need to 
be made for all modes of transport, including supply infrastructure and demand in order to effectuate 
the  required  emissions  reductions  while  at  the  same  time  promoting  the  digital  transition  (European 
Commission, 2019a; European Parliament, 2020). Key elements of sustainable mobility for the European 

26 On the one hand, impacts of the financial crisis must be considered. On the other hand, the data on more 
recent  years  must  be  interpreted with  caution since younger  companies  are  often relatively  small  and 
therefore  not  yet  sufficiently  well  known  that  they  are  included  in  the  Crunchbase  database.  Data  on 
company foundations in recent years can therefore be downwards biased. This restriction holds for the 
analysis of all Green Deal priority areas analysed here.  

Jan-22  
38 

 
 
     
 
 
                                                                                                                           
 
 
 
                                           
Green Deal include zero- and low-emission vehicles in connection with the manufacturing industry sector 
and sustainable alternative fuels such as advanced biofuels. 

The  automotive  industry  remains  one  of  the  most  important  economic  sectors in  the  EU, employing  2.6 
million people in the EU-28 in 2017 (European Commission, 2019c). The development of the electric car 
stock  by  region  and  technology  shows a  relatively  constant  growth  across  world  regions,  with  a  slightly 
larger proportion  of  growth  for China  as compared  to  the  remaining  world  regions  (International  Energy 
Agency, 2019d). Considering the importance of the automotive industry in the EU, it will be important for 
European companies to follow the transition to electric mobility in order to retain their competitive position 
globally.  

Results from the EU industrial R&D  innovation Scoreboard 2019 show the actual regional distribution of 
companies in the mobility sector in 2018 (Figure 28). Most companies (54) are headquartered in the EU. The 
regional distribution of companies within the EU is highly concentrated on a few major actors located in 
Western  Europe.  Almost  one  third  of  the  EU  companies  in  the  mobility  sectors  are  German  companies, 
followed by Italian firms (7) and UK firms (6 companies) whereas the remaining EU enterprises are spread 
across a variety of EU countries. The EU itself is followed by Japanese companies (35), US firms (32) and 
China (24).  

Figure 28: Number of Scoreboard companies by country, Mobility 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

Characterisation of the networks and involved actors 

Based  on  various  analyses,  three  noticeable  companies  in  the  transport  sector  were  identified  and 
interviewed. These are a German SME and a German MNE as well as one Swedish MNE27. The German SME 
is part of an industrial consortium that produces synthetic fuel based on hydrogen and carbon (obtained 
from CCU, carbon capture and utilization) for the aviation sector. The German MNE is, among others, part of 
a network that performs project-specific R&D&I regarding the diversification of power trains in the area of 

27  A  Chinese  enterprise  is  one  of  the  main  owners  of  this  MNE.  Based  on  our  desk  research,  this  Chinese 
enterprise is not involved in the Global Innovation Networks the MNE analysed in this research study is 
part of. 

Jan-22  
39 

DE19IT7GB6EU other countries22US32JP35CN24IN6KR5KY4RoW other countries11Number of Scoreboard companies by region, MobilityEU total40EU total40EU total40EU total40EU total40EU total40EU total40EU total54EU total40EU total40EU total40EU total54 
 
     
 
 
                                                                                                                           
 
 
 
                                           
e-mobility.  The  Swedish  company  is  also  active  in  different  projects,  including  a  project  regarding  the 
distribution and acceleration of hydrogen powered trucks throughout Europe.  

The reasons  for the interviewed companies in the  mobility sector to become involved in GINs instead of 
developing the above-named technologies otherwise were for instance: 

- 

- 

- 

- 

- 

- 

the mobility sector being a highly competitive area, making it necessary to join forces with different 
actors in the field, 

diverse skill sets, strategic knowledge as well as financial instruments and material equipment, 

strategic aspects including the aim to diversify, 

the possibility to try out new things and reduce the (financial) risk, due to spreading among different 
actors, 

the establishment of new research partnerships and new business relationships that can evolve 
from funded projects, 

as well as networks being important tools in technological and social innovation processes as they 
help  bring  different  companies  and  ideas  together  to  learn  from  each  other  and  foster  an 
innovation-friendly environment.  

Research  networks  for  instance  help  speeding  up  the  transition  towards  electric  mobility  and  hydrogen 
fuelled vehicles by providing a larger “lobby”. 

In some cases, the inclusion of a specific actor is important. Some projects are for instance only funded if 
academia is included in the project team. Furthermore, MNEs benefit from innovative ideas, niche knowledge 
or transfer performance  from SMEs as well as basic  research in  materials or on societal impacts of the 
innovations conducted by academia. In return, MNEs often provide access to markets and liquidity, specific 
engineering skills, employee training and recruiting benefits as well as hands on R&D and sharing expertise. 
In larger networks, OEMs often are important actors as well, since they often bundle results. 

Figures  29  to  31  display  the  networks´  geographical  distribution.  The  networks´  geographical  scope  is 
variable and seems to a certain degree correlated with the number of actors. The more actors involved, the 
higher the probability that non-European members are included in the network. The network displayed in 
Figure 29 consists of four European members (two EU members), of which two are SMEs which provide the 
necessary  technology,  an  investment  company  focusing  on  cleantech  investments28  and  an  MNE  that 
contributes to the project by its engineering and project execution competences. 

A contractual Public Private Partnership (cPPP) can be seen in  

Figure 30. Due to the international scope and the high differentiation in the type of actors, this network can 
be  characterized  as  GIN.  Its  members  work  and  co-operate  on  sustainable  motor  vehicles.  They  are 
headquartered  in  many  countries within  the  EU.  Actors  from European  non-EU  countries are  involved  as 
well.29 Besides industrial corporations, research organisations and universities are taking part. Contrary to 
the first mobility network, this network includes 84 members in total of which 42 are  industrial members 
(16 OEMs) and 33 can be assigned to the academic sector. Its members are headquartered in 19 different 
countries,  of  which  17  are  European  countries  and  two  actors  are  headquartered  in  the  US  and  Japan, 
respectively.  

The third mobility network is a project-based private research consortium assembled in December 2020, 
consisting of industry partners from Germany, the Netherlands, Italy and Austria (depicted in  Figure 31), 
centred in Sweden. With the help of each project partner, the research consortium aims to establish a market 
with a favourable framework for efficient hydrogen transport. To achieve this, the companies plan to work 
together with legislators and policymakers of several countries and on EU level. 

28 Crunchbase (2020) 
29 Although the headquarters of some of the actors are located outside Europe, as illustrated in Figure 30, 
only parts of the companies located in the EU are involved in the network. 

Jan-22  
40 

 
 
     
 
 
                                                                                                                           
 
 
                                           
Figure 29: Graphical illustration of the Global Innovation Network, SME 1 

Figure 30: Graphical illustration of the Global Innovation Network, MNE 1 

Source: VDI TZ, based on interviews and additional research. EU member states 
(EU27) in blue. For a better overview there is just one line per country even 
though  in  practice  there  are  usually  several  actors  involved  on  the  country 
level. 

Source: VDI TZ, based on interviews and additional research. EU member states 
(EU28) in blue. For a better overview there is just one line per country even 
though  in  practice  there  are  usually  several  actors  involved  on  the  country 
level. For details see description below this figure. Grey lines represent Japan 
and the USA. 

Jan-22                                                                                                                            41 

 
 
     
 
 
 
 
Figure 31: Graphical illustration of the Global Innovation Network, MNE 8 

Source: VDI TZ, based on interviews and additional research. EU member states 
(EU28) in blue. For a better overview there is just one line per country even 
though in practice there are sometimes several actors involved on the country 
level.  

Jan-22                                                                                                                            42 

 
 
     
 
 
 
 
 
 
Key enabling technologies and technological maturity 

Similar  to  the  other  sectors,  transformation  processes  in  the  transport  sector  will  be  accompanied  by 
technological change going beyond decarbonisation, including digitalisation, Internet of Things (IoT), as 
well as individualisation and mass-customisation. Mobility specific big data, integration of modes of transport, 
including  new  shared  mobility  services,  autonomous  driving  and  Mobility  as  a  Service  (MaaS)  instead  of 
ownership  has  the  potential  to  reshape  the  mobility  sector  (Arthur  D.  Little,  2018).  Relevant  technologies 
prioritised  in  the  EU’s  Strategic  Transport  Research  and  Innovation  Agenda´s  Roadmaps  are  for  instance: 
electrification,  alternative  fuels,  vehicle  design  and  manufacturing,  connected  and  automated  transport, 
infrastructure,  network  and  traffic  management  systems,  and  smart  mobility  and  services  (European 
Commission,  2017a).  Other  key  solutions  listed  by  the  International  Renewable  Energy  Agency  (IRENA)  that 
support the decarbonisation of key emitters in the transport sector include electrification, hydrogen, biofuels 
and synfuels (IRENA, 2020). 

These  literature-based  results  can  be  cross-checked  using  quantitative  methods.  The  Crunchbase  database 
contains  information  on  funding  rounds  and  investments  with  a  focus  on  start-ups  active  in  technological 
sectors (Dalle et al., 2017). Of the 1,075 start-ups active in the mobility area, 39 enterprises are also operating 
in highly policy relevant areas, equalling a share of 3.63 percent. Compared to other Green Deal priority areas 
(especially Industry and Batteries), this share is relatively low. The synergies are as follows: 

-  32 start-ups in key and emerging software technologies (23 in IoT, 8 in AI, one in embedded systems) 

-  5 in KETs (2 in nanotechnology, 3 in advanced materials) 

-  2 in advanced manufacturing technologies (3D-printing) 

These numbers indicate interceptions between the mobility sector and key and emerging software technologies. 
As can be seen from the analysis, both qualitative and quantitative results showed interaction points between 
mobility and IoT and AI.  

Potential for growth  

The growth potential of mobility can, to a certain degree, be monitored by the analysis of certain innovation 
indicators. On the output level, we focus on results from the patent analysis to analyse companies´ R&D&I 
competitiveness regarding the European Green Deal.  

Analyses  of  the  PATSTAT  database  identified  almost  20,000  green  patents  in  the  Green  Deal  priority  area 
mobility. The regional distribution of the top-100 patenting firms in the mobility sector is concentrated: 44 of 
the companies are headquartered in Japan, followed by 25 companies headquartered in the EU. Both the US 
and RoW rank similarly regarding their patenting activities in the mobility sector. Only two Chinese companies 
are listed among the top - 100 mobility patenting firms.  

The  analysis  of  total  R&D  investments  per  region  based  on  the  2019  EU  Industrial  R&D  investment 
Scoreboard  provides  input  indicators  per  region.  Figure  32  gives  the  temporal  development  of  total  R&D 
investment in the Scoreboard between 2009 and 2018. In direct comparison to both other Green Deal priority 
areas, the total R&D investment is highest in the mobility sector and still following a positive trend. The total 
R&D investment  of  EU  Scoreboard  companies  has  more  than  doubled  between  2009  and 2018.  Total  R&D 
investments are highest for the EU, followed by Japan, the US, RoW and China. On a country level, the EU is 
most competitive in terms of total R&D investment.  

43 

 
 
     
 
 
 
Figure 32: Total R&D investment by region, mobility sector (in EUR Mio.) 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

Similar to  total  R&D investment, EU  companies  in  the  Scoreboard  have  the  highest  amount  of  mean  R&D 
expenditures (total R&D expenditures in shares of the number of companies), followed by Japan and the US. 
The R&D intensities, calculated as total R&D investment per net sales, are highest for the EU as well, reaching 
a maximum share of almost 0.3 in 2017.  

The EU has the highest R&D investments per net sales in the mobility sector, reaching a maximum with a share 
of almost 0.3 for the year 2017. Adding up all shares for each world region (between 2009 and 2018) indicates 
that US companies are ranked second in terms of R&D intensities (0.46 in total), followed by China (0.37 in 
total), Japan (0.35) and RoW (0.335). Showing diverging trends from 2009 to 2013, all considered world regions 
show  similar developments  from 2013 to 2019. This indicates global trends in the  mobility sector. In total, 
China and RoW show a general, significant increase in R&D intensities between 2009 and 2018, while the 
other regions show no clear (EU), a stagnating (Japan) or a decreasing trend (US) in terms of R&D intensities.  

Figure 33: Total R&D investment by region, mobility sector (shares) 

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

44 

010.00020.00030.00040.00050.00060.00070.0002009201020112012201320142015201620172018Total R&D investment by region and Green Deal priority area, Mobility (in EUR Mio.) EUUSJapanChinaRoW00,050,10,150,20,250,30,3500,010,020,030,040,050,060,072009201020112012201320142015201620172018R&D intensity -area Mobility EUUSJapanChinaRoW 
 
     
 
 
The number and trend of employees in specific sectors in general and relatively compared to other sectors 
is an indicator of the  competitiveness of a sector regarding the production factor labour.  A high number of 
employees as well as an increasing workforce is an indicator for a well developing industry.  

Figure 34: Number of employees employed by companies from 5 main regions, mobility sector (in thousands, 
change)  

Source: VDI TZ based on 2019 EU Industrial R&D investment Scoreboard  

In general, Scoreboard companies active in the mobility sector had in total the highest number of employees 
(Figure 34, for all regions compared and for both 2009 and 2018) as well as the largest increases, compared 
to the industrial and the energy sector. In both 2009 and 2018 European enterprises in the transport sector 
employed most workers with a maximum workforce of almost 3.4 million employees in 2018, followed by Japan 
(almost 2 million employees), the US (approx. 1.3 million), China (approx. 0.99 million) and RoW (0.55 million 
employees in 2018).30 The total number of employees is key to the present competitiveness of a sector. Contrary 
the growth rate of employees indicates a sector´s and / or region´s growth potential. RoW mobility companies 
registered  the  highest  increase  by  almost  200  percent,  while  Chinese  mobility  companies  increased  their 
number of employees by 150 percent. Established regions that already have a strong labour force, namely the 
EU, Japan and the US, have lower growth rates.  

The EU Industrial R&D investment Scoreboard lists companies that invest the largest sums in R&D in the world. 
In  contrast,  the  Crunchbase  database  lists  innovative  tech  start-ups  and  provides  data  on  the  amount  of 
funding the start-ups receive. Figure 35 gives the development of newly founded companies in the mobility 
sector.  

30 These numbers only represent the number of employees in the mobility sector employed by companies that 
are listed in the EU Scoreboard and does not illustrate the total number of workers in a specific region. 

45 

22369901524396186+ 50%+ 32%+ 26%+ 150%+ 194%33651305192298954905001000150020002500300035004000EUUSJapanChinaRoWEmployees 2009Employees 2018 
 
     
 
 
 
                                           
Figure 35: Number of foundations per year, mobility sector 

Source: VDI TZ, based on Crunchbase database (2020) 

Between 2000 and 2018, 719 start-ups were founded in the mobility sector, which results in a share of 68 
percent of start-ups younger than 20 years. Furthermore, there is a clear trend in the number and development 
of start-up founding activities in this sector. Beginning with 9 foundations in 2000, the number of start-ups 
almost nine folded by 2018 (79 start-ups), following an almost steady increase. This indicates that the mobility 
sector represents a very promising, uprising market with the potential to achieve high profits.  

Figure 36: Total and average amount of funding (Mio. USD), mobility sector 

Source: VDI TZ, based on Crunchbase database (2020) 

Building  on  data  from  the  Crunchbase  database,  we  find  that  start-ups  in  the  mobility  sector  (Figure  36) 
received  about  60  Billion  USD  of  total  funding,  of  which  major  parts  were  received  by  companies 
headquartered in the US (about 34 Billion USD) and China (about 17 Billion USD). Japanese and EU start-ups 
received significantly less investments. On EU level, companies from the UK received most (554 Million USD), 
followed  by  Germany  (382  Million  USD)  and  Sweden  (229  Million  USD).  Adding  information  about  mean 
funding shows that on company level, Chinese start-ups are highest-ranking (237.5 Million USD per company), 
followed by Japanese (141.5 Million USD) and US start-ups (112.5 Million USD). EU start-ups received only a 
fragment of this (1.12  Million USD per company). Relating this information to the  numbers of start-ups per 
region implies that there are a few Asian companies that display strong competitors to companies in the US 
and especially in the EU. In terms of funding European start-ups have a relatively weak market-position.  

3.4  Cross-sectional technologies – Hydrogen and Batteries 

Background 

46 

0204060801002000200120022003200420052006200720082009201020112012201320142015201620172018Anzahl Startups 
 
     
 
 
 
 
 
Batteries and hydrogen have the potential to support and accelerate the decarbonisation and transformation 
of sectors with  high emissions. In sectors where full electrification is not possible, such as the  mobility and 
transport sector for instance, the use of hydrogen represents an alternative. Also, the future of the chemicals 
industry  in  Europe  is  strongly  intertwined  with  the  future  of  hydrogen  technology.  Hydrogen  can  be  ‘grey’ 
(sourced from fossil-based technologies), ‘blue’ (from natural gas where CO2 is stored or re-used) or ‘green’ 
(from renewable energy). Both ‘blue’ and ‘green’ hydrogen are considered as low-carbon solutions. Batteries 
can also act as catalyst for the transformation of the mobility sector and enable transformations in industrial 
processes to lower CO2 emissions and at the same time support the energy system.  

Characterisation of the networks and involved actors  

Hydrogen  and  batteries  are  classified  as  cross-sectional  technologies  within  this  study  and  hence  were  not 
subject to the case studies themselves. Due to high interceptions with the industry, mobility and energy sectors, 
both key technologies have indirectly been addressed within the case studies.  

Identified networks performing R&D in the hydrogen area were found in the industrial, the mobility and the 
energy sector. The networks show a large variety, ranging from a consortium with four European profit-entity 
based members to a PPP with more than 350 members from the academia and corporate sector as well as 27 
national associations. The motivation for different actors to become involved in these networks differs. SMEs, 
for instance, benefit from the access to market and financial support by MNEs. Another important reason was 
the  help  of  each  network-partner  to  establish  and  accelerate  the  new  hydrogen  market.  Academic  actors 
contribute by providing basic research and advantages in the creation of scientific publications.  

Similar to the literature-based results, also the expert interviews revealed interceptions between the battery 
sector and mobility and energy. A company from the mobility sector, a vehicle OEM, expects a rising market 
share for battery electric vehicles that is, from their point of view, expected to be larger than the shares of 
hydrogen  driven  vehicles.  The  largest  cross-sectoral  technologies  concerning  batteries  were  found  in  the 
materials and recycling sector and the energy sector. One important network is, for instance, the Global Battery 
Alliance31,  a  formal  network  with  membership  and  fees.  Stakeholders  included  here  are  highly  diverse  and 
include cell manufacturers, car manufacturers, and materials companies, however some research organisations 
are  included  as  well.  Projects  within  this  Alliance  are  focussed  on  finding  common  innovative  solutions  in 
working groups. Funding in this project is provided by company means.  

Key enabling technologies and technological maturity 

As mentioned above, hydrogen itself is an important feedstock that has, as a cross-sectional technology, the 
potential to decarbonise major high-emission sectors and hence already is a highly prioritised technology itself. 
To strengthen and secure this position, industries need to focus on deployment of the technology, especially in 
view  of  the  industries’  strengths and  capabilities.  In  order to  realise  the  uptake  of  hydrogen  technology, as 
outlined  in  the  Hydrogen  Roadmap  ambitious  scenario,  technologies  that  are  ready  for  uptake  should  be 
deployed for relevant industries. This would allow for cost reduction due to economies of scale. Yet, there are 
only few interferences between start-ups operating in the hydrogen sector and start-ups operating in highly 
policy relevant fields: From 175 hydrogen start-ups recorded in the Crunchbase database, only four are also 
operating in the KET sector, two in Advanced Materials and two in Biotech, implying few synergy effects. 

Similar to  hydrogen  solutions,  batteries  are  also  considered  to  have  a  clear role  in  future  decarbonisation 
scenarios at the Global scale and are currently mainly used in the sectors of energy storage and electric mobility. 
But battery technologies also face diverse challenges on environmental and social integrity as well as its GHG 
emission footprint. Further barriers are, among others, the viability of battery-enabled applications related to 
overall profitability, but also recycling challenges (World Economic Forum, 2019).  

Analysis of the Crunchbase database resulted in 46 start-ups operating in the batteries sector that are also 
active in the sector of KET:  

31 https://www.weforum.org/global-battery-alliance/home 

47 

 
 
     
 
 
 
                                           
-  25 in KETs (17 in nanotechnology, 8 in advanced materials) 

-  18 in Key and emerging software technologies (6 in AI, 11 in IoT, 1 in Quantum computing and one in 

embedded systems) 

-  2 in advanced manufacturing technologies (3D-printing) 

These outcomes simply interceptions between the battery sector and key and emerging software technologies 
and KETs.  

Potential for growth 

Considering  the  international  competition  on  the  market  for  hydrogen  production,  Europe  is  currently 
considered a technology leader in hydrogen and is aiming to keep this position or even expand their advantage. 
Figure 37 highlights the ambitious growth scenario for hydrogen deployment in Europe. These plans suggest 
the hydrogen market in Europe will further grow in the future. Nevertheless, there are still barriers that need to 
be addressed to ensure the European hydrogen market to grow. The future of the successful uptake of hydrogen 
technology relies on the role of policies, certification, fostering competitivity and market design, safe and flexible 
infrastructure, safe and efficient transport, among others (European Chemical Industry Council, 2019).  

Figure 37: Ambitious scenario for hydrogen deployment in the EU 

48 

 
 
     
 
 
 
 
 
Source: FCH 2 JU, 2019  

Analysis of the current and emerging number of start-ups operating in the hydrogen sector gives in total 175 
companies, of which the majority (101) has been founded from 2000 onwards, implying a young market that 
is still gaining more and more emphasis. Yet the number of hydrogen start-ups in the Crunchbase database 
does not exhibit clear trends from 2000 onwards (Figure 38).32  

Figure 38: Number of foundations per year, hydrogen sector 

Source: VDI TZ, based on Crunchbase database (2020) 

Since batteries are classified as important catalysts in transforming emission-intensive industries, this sector 
is  expected  to  further  expand  on  a  global  level.  Nevertheless,  regional  growth  rates  will  also  differ  due  to 
unevenly spread demand for batteries. In line with studies, China is making up the biggest market for batteries 
(43% in  2030). CAGR will also  differ as a function of the different global markets  (World Economic Forum, 
2019).  

Results  of  the  total  and  emerging  number  of  start-ups  operating  in  the  battery  sector,  obtained  from  the 
Crunchbase database, confirm the promising growth opportunities from the battery sector. There are 559 start-
ups  listed  in  the  Crunchbase  database,  of  which  about  350  were  created  from  2000  onwards,  implying  an 
almost continuously steep increase, as can be seen in Figure 39. This growing number of companies rises the 
competition level in a market, leading to decreasing product prices and decreasing company profits, primarily 
competition is assumed. 

Figure 39: Number of foundations per year, battery sector 

Source: VDI TZ, based on Crunchbase database (2020) 

32 As mentioned earlier, younger years only indicate a trend since it is possible that younger companies are less 

known and therefore not listed in the Crunchbase database. 

49 

0510152000200120022003200420052006200720082009201020112012201320142015201620172018Anzahl Startups05101520253035402000200120022003200420052006200720082009201020112012201320142015201620172018Anzahl Startups 
 
     
 
 
 
 
                                           
This increasing trend indicates a promising sector, in which many actors want to become a part of. Furthermore, 
an increasing number of companies increases the competition level in a market. This leads to decreasing product 
prices and decreasing company profits, if it is assumed that companies are primarily competitors. 

As  to  funding  in  the  hydrogen  sector,  North  American  countries  like  the  USA  and  Canada  are  strong 
competitors to the EU. Here, start-ups located in the UK, Germany and Sweden are well positioned in terms of 
both total amount of funding and numbers of companies. Further, the UK leaving the EU will presumably reduce 
the EU’s competitiveness in the hydrogen area, on a regional level. US companies in total receive highest funding 
in the battery sector. On company level, Japanese start-ups receive higher funding (about 37 Mio. USD) in 
this sector.  

Figure 40: Total and average amount of funding (Mio. USD), hydrogen sector 

Source: VDI TZ, based on Crunchbase database (2020) 

Figure 41: Total and mean amount of funding (Mio. USD), battery sector 

Source: VDI TZ, based on Crunchbase database (2020) 

Potential related to the Green Deal 

The  three  Green  Deal  priority  areas,  industry,  energy  and  mobility,  have  a  high  potential  to  contribute  to 
achieving the goals of the European Green Deal. This is because all three sectors have a long history of being 
and still are sectors with a large contribution to global GHG emissions. At the same time, these sectors have 
the potential to decarbonize and turn into sustainable sectors, be it by a reduction of resource consumption 
or the increase of recyclability. It is common sense that the development of sustainable technologies is 
crucial for decarbonizing the economy (European Investment Bank, 2021).  

50 

 
 
     
 
 
 
 
In the industrial sector, we analysed two of the highest emitting areas, steel and chemistry. To reduce the 
consumption of resources and the emittance of GHG in both areas, certain measures were identified. In the 
steel sector, alternative feedstocks such as hydrogen or CCU technologies as well as the substitution of 
conventional  for  renewable  energy  play  a  crucial  role.  To  decarbonize  the  chemical  sector,  the  use  of 
feedstock based on alternatives for carbon (such as waste and CO2) and the application of alternative production 
processes  will  help  here.  The  Global  Innovation  Networks  (GINs)  analysed  in  the  industrial  sector 33  highly 
contribute to these applications by providing research and / or developing (technological) solutions in this field, 
such as the process of hydrogen production for several sectors. Another GIN is currently developing guidelines 
for hydrogen charging, which will contribute to supporting and accelerating of a hydrogen economy, whereas 
the materials technology and recycling company is operating within a GIN, that is, among others, operating in 
the field of material sciences, recycling and energy efficiency and hereby performing R&D&I also in the area of 
alternative feedstock for the chemical sector.  

The energy sector plays a crucial role in contributing to the GHG emissions and is likewise an important actor 
of the critical infrastructure. A growing share of alternative produced energy is necessary to reduce the energy 
sector´s emissions. Reducing the amount of fossil resources is another relevant factor in contributing to 
the net zero goal. The energy companies we interviewed are energy producers. Reduction goals such as CO2 
emissions, energy consumptions or fossil resource reductions become increasingly essential in their business 
areas as well. The technologies that the companies focussing on are highly relevant for the European Green 
Deal and switching to alternative energy consumption is key. Another important factor is the consumption of 
energy which, if energy reduction is difficult, should be shifted towards renewable energy. Specific objectives in 
the energy sector lie, for instance, in the production of energy based on wind, or in the use (and correct recycling) 
of batteries or the use of hydrogen. Within the energy sector, green business sectors and relevant technologies 
that are addressed within the GINs34 are for instance geothermal and hydrogen or sustainable energy based on 
hydrogen  and  nature-based  alternatives.  Other technologies the  networks  are  operating  in  have  a  focus  on 
biological residues and waste to increase sustainability of products. 

New and sustainable technologies have the potential to drive the transition in the mobility sector. Some of 
these technologies are created with the help of different types of actors. As part of this study, we conducted 
interviews with companies that are part of Global Innovations networks (GINs) and that have direct participation 
in the development of technologies supporting the decarbonization in the mobility sector.  

Relevant technologies in the mobility sector that have been addressed within the interviews, are e. g.  

- 

- 

Renewable fuels, such as the production of e-fuels for the aviation sector, using carbon capture and 
the production of green hydrogen via electrolysis.  

Sustainable Power, such as the diversification of power trains in e-mobility. 

As already mentioned in the background section, many technologies must be combined to reduce emissions, 
which is the highest goal. Besides synthetic fuels, based on carbon and green hydrogen, biofuels are relevant 
as well, but the feedstock is limited here. Kerosene produced via the “methanol route” is another way to produce 
alternative fuels for the aviation sector but is regarded more expensive than the use of green hydrogen and 
CCU. Synthetic fuels’ potential to contribute to a circular economy can be seen as very high since CO2 is extracted 
from the air and then transformed into e-fuels and related goods. This contributes to the net zero goal.  

A growing electrification of the mobility sector is another option to contribute to the transformation of the 
mobility sector. One interviewed company participates in a network that is, among other topics regarding the 
decarbonization of road transport, currently addressing the issue of diversification strategies for power trains 
in  e-mobility.  The  network´s  objectives  are  linked  with  activities  to  push  the  development  of  efficient  road 
transport  vehicles  and  innovative  strength  and  to  increase  the  competitiveness  of  European  firms  and  the 
European economy compared to other main world regions.35  Another network is addressing the dissemination 
of hydrogen powered trucks throughout Europe. Hydrogen technology and especially its commercial application 

33  Information  provided  here  is  based  on  desk  research  and  interviews  conducted  with  two  chemical  and  a 

materials technology and recycling company. 

34 The named technologies refer to the activities of the GINs. For information on green innovative technologies 

the companies themselves are operating in, please consider the case studies.  

35 Based on additional research, mainly conducted via: https://egvi.eu/what-we-do/egvi-cppp-roadmap/. 

51 

 
 
     
 
                                           
(e.g. in heavy-duty transportation) constitute a priority area in the European Green Deal.36 With the help of each 
project partner, the research consortium aims to establish a market with a favourable framework for efficient 
hydrogen transport. 

Hydrogen  and  batteries  are  manifold  applicable  technologies  that  have  a  high  potential  to  support  the 
transformation of many high-emitting sectors. Although the expert interviews were conducted with companies 
operating in the three Green Deal priority areas identified, both cross-sectional technologies play crucial roles 
in several R&D&I networks analysed here. Batteries can have a positive value on the decarbonization of the 
mobility sector, for instance, but the whole value chain must be considered. Efficient battery recycling processes 
together with producing sustainable high-quality battery chemicals supports the targets of recycling rates and 
the  usage  of  recycled  raw  materials  presented  in  the  new  Batteries  Directive  proposal  of  the  European 
Commission.  Hydrogen  is  also  used  in  multiple  applications  such  as  feedstock  for  alternative  fuels  that 
addresses  reduced  resource  consumption.  According  to  the  interview  partners,  the  use  of  e-crude  based  on 
hydrogen and CO2 reduces greenhouse gas emissions by 90-95 percent, compared to conventional fuels. Since 
there  is  an  interplay  between  these  two  cross-sectional  technologies  and  the  Green  Deal  priority  areas,  all 
technologies in question have positive impacts on more than just one principle. 

The companies that were interviewed in the frame of this study exhibit a diverse but, in their fields, specialized 
skill  set  and  are  therefore  important  actors  in  contributing  to  the  industry´s  shift  towards  sustainability. 
According to most of the interview partners, an actor´s skill set is one of the main reasons for other companies 
to join forces with them. Hence, companies that are mainly operating in sustainable business sectors or shifting 
their  business  towards  these  sectors  are  likely  also  organized  in  GINs  focussed  on  sustainable  technology 
solutions, merging knowledge and skills from different actors. Regardless the specific branch, being organized 
in a GIN can contribute to reaching the goals of the Green Deal. Consolidation of different professions such as 
basic research, niche knowledge and innovative ideas, but also financial endowment, business networks and 
market  power  help  develop  new  ideas,  and  support  and  accelerate  the  development  of  new  technologies 
contributing to the Green Deal.  

According to the interview partners, sharing risks or the possibility to receive funding can create incentives to 
perform R&D&I. Further, the inclusion of different groups of actors and from different countries or world regions 
can also lead to spill-over effects that have a positive impact on the development of sustainable technologies. 
Being organized in a GIN furthermore increases the outreach to policy makers easing the addressing of general 
or specific barriers, for instance in the development of a hydrogen economy. This aspect is even stronger if 
political  institutions  are  directly  integrated  in  these  networks,  such  as  in  the  case  of  PPPs.  Hence,  GINs 
themselves can have a high potential to contribute to reaching the Green Deal´s targets.  

36 https://www.fch.europa.eu/news/european-green-deal-hydrogen-priority-area-clean-and-circular-economy 

52 

 
 
     
 
 
                                           
4  Policy context and policy toolbox 

4.1  Framing and main current policy context 

Framing 

For this study it was necessary to do a framing which is the process of embedding events and topics relevant 
to our study in interpretive grids. The starting point for this is the European Green Deal. The European Green 
Deal  presented  by  the  European  Commission  in  2020  is  linked  with  the  need  for  thinking  out  of  the  box 
concerning tailor-made policy instruments and the adequate mixes in a  period of numerous transitions and 
technological breakthroughs. Since we observe already a starting transformation in several industries this is 
our second point for framing.  

Our  third  point  for  framing  is  based  on  recent  research  on  innovation  and  industrial  policy. 37  This  research 
stresses the need for the so-called intelligent governance of policy instruments and measures. Scholars like 
Edler  and  Fagerberg  (p.15)  (2017)  make  the  case  for  four  governance  principles.  These  are  anticipation, 
participation, deliberation, and transparency. From their point of view, these principles are necessary to ensure 
that societal preferences and concerns are taken into account in R&D and innovation processes and policies. 
Recent research also shows that successful innovation and industrial policies combining a whole set of policy 
instruments have led to radical innovations. It should be underlined that these policies have been more focused 
on market shaping and creating through direct and pervasive public financing than on market fixing (Mazzucato 
& Semienuk, 2017; d´Andria & Savon, 2018). This means that instruments are changed and combined with 
other instruments to address the new (and sometimes ‘old’) problems and challenges of innovation and industry. 
The public financing of innovation becomes even stronger as a strategic tool since it can help to shape and 
create markets. This market shaping approach suggests that the use of policy instruments must be “proactive 
and  bold,  creating  directions,  and  transcending  the  role  envisaged  by  market-  or  social  system  fixing 
approaches” (p. 44) (d´Andria & Savon, 2018).38  

Main current policy context 

In this chapter a description of the main current policy context in place is provided. The focus of this chapter is 
on existing policy strategies, initiatives and plans, regulatory and financial frameworks, especially regarding the 
potential effects on the developments in the analysed sectors and technological fields (green energy, green 
mobility,  sustainable  industry  hydrogen  and  batteries).  The  main  drivers  and  barriers  for  investing  in 
technologies relevant  for Europe's Green Deal are also addressed.  Most  recent  developments in the US and 
China are also important to discuss since they show how the situation in the EU differs from other countries. 

The  European  Green  Deal  (European  Commission,  2019a)  has  the  ambitious  aim  to  boost  Europe’s 
competitiveness based on cutting-edge innovation in a broad sense. It can be seen as an integral part of the 
European  Commission’s  strategy  to  implement  the  United  Nations  2030  Agenda  and  the  Sustainable 
Development Goals (SDGs) (United Nations, 2019). In addition, the European Green Deal can be seen as a 
paradigm shift in European politics that is designed to lead the change towards making the European economy 
digitalised and environmentally sustainable. The long-term goal of the new growth strategy is to make Europe 
the first carbon neutral continent by 2050. The intermediate goal is to decrease greenhouse gas emissions by 
55% by 2030. This entails the necessity of efforts in R&D&I that will eventually shape EU policy and have a 
direct impact on industry and civil society. The growth strategy includes a timeline for guiding documents to be 
published between 2020 and 2023. 

The  seven  identified  policy  areas within  the  scope  of  the  European  Green  Deal  affect  all  areas of  industry, 
science and civil society, albeit on different scales and at different times. For the analysis in our study the first 
five items are especially important (European Commission, 2020a): 

37 For a summary of this discussion see for instance Malanowski, N. & Tübke. A. & Dosso, M. & Potters, L. (2021). 
Deriving new anticipation-based policy instruments for attracting research and development and innovation 
in  global  value  chains  to  Europe,  Futures,  128  (4),  1-12  and  Borras,  S.  &  Edquist,  C.  (2019).  Holistic 
Innovation Policy. Oxford University Press. 

38 For a more detailed discussion on this Malanowski, N. et al. (2021). 

53 

 
 
     
 
                                           
-  Clean energy: focussing on alternative, cleaner sources of energy 

- 

- 

- 

Sustainable industry: looking at more sustainable, environmentally respectful production  

Sustainable mobility: promoting sustainable transport 

Eliminating pollution: cutting pollution quickly and efficiently 

-  Climate action: targeting a climate neutral EU by 2050 

In this study we focus on Green Deal priority areas, including clean energy, sustainable industry, sustainable 
mobility, as well as hydrogen and batteries as two key technologies. The rationale for the selection of these 
priority areas is three-fold:  

1  Contribution to Green Deal objectives: The Green Deal targets, among others, clean energy, sustainable 
industry and sustainable mobility. Together, the sectors of energy, industry and mobility are responsible 
for 87% of emissions in the EU-28 (as of 2019). Industrial processes and product use accounts for 8% 
of total greenhouse gas (GHG) emissions, whereas transport accounts for 25% and fuel combustion 
(excluding transport) for energy accounts for 54% (Eurostat, 2019). Seeing the overall emissions, these 
areas also have a great potential, through key innovations, to make positive contributions to emissions 
reductions.  

2 

Innovativeness: For the transformation to succeed, all sectors need to respond to the EU’s commitment 
to reduce emissions and tackle climate change. Highly innovative sectors, such as those depicted in 
the Strategic Value Chains (SVC) of the Important Project of Common European Interest (IPCEI) are 
linked  to  key  enabling  technologies,  technological  breakthroughs  or  disruptive  innovation.  For  the 
Strategic Forum on IPCEI, the aim was to identify strategic value chains for joint or well-coordinated 
investment  and  action  coupled  with  a  joint  vision.  The  six  SVCs  including  connected,  clean  and 
autonomous vehicles, hydrogen technologies and systems, smart health, Industrial Internet of Things, 
Low-CO2 emission industry, and Cybersecurity. The sectors of energy, mobility and industry have been 
leading the innovation wave related to low carbon and circular innovation, also within the framework 
of the SVC, with many examples already present in their works. Not only do these sectors have a proven 
capacity to innovate, but there is a high willingness amongst major actors to search for and implement 
new technologies to support further greening (European Commission, 2019b).  

3  Competitiveness: The selected areas are positioned within global value chains, where it is particularly 
interesting to analyse the EU’s competitive position as compared to key global players such as China 
and  United  States.  The  IPCEI  is  a  special  instrument  under  state  aid  rules,  which  can  be  used  to 
strengthen the competitiveness of strategic value chains and can also serve as a financing instruments 
for environment, transport, energy projects of strategic European importance (European Commission, 
2019b) 

The European Research Area (ERA) (European Commission, 2020) is intended continuing to incentivise R&D 
investment from the private sector. This can be also found in the roadmap (European Commission, n.d.c). that 
aims to revitalise ERA underlining the importance of a transformative R&I policy that shapes technological and 
societal  change  to  deliver  a  sustainable  European  society.  Horizon  Europe  beginning  in  2021  is  the  new 
programme for research and innovation partly linked with the European Green Deal. It is intended to facilitate 
collaboration and strengthen the impact of research and innovation in developing, supporting and implementing 
EU policies while tackling global challenges. It supports creating and better dispersing of excellent knowledge 
and  technologies  (European  Commission,  n.d.a).  Horizon  Europe  is  mission  oriented.  The  missions  are 
commitments  to  solve  some  of  the  greatest  challenges  facing  the  world  like  adapting  to  climate  change, 
protecting our oceans, living in greener cities etc. Each mission shall operate as a portfolio of actions – such as 
research projects, policy measures or even legislative initiatives - to achieve a measurable goal that could not 
be achieved through individual actions. 

The European Commission emphasises the need for structural transformation of the economy and need for 
crosscutting policy support towards competitive sustainability where EU companies play a central role in the 
transition to a more environmentally friendly path while at the same time competing on a global level. There is 
a priority on resource and energy intensive industries in their efforts to adhere to the Green Deal timeline. 
Focusing on these industries first sets the basis for when member states are expected to update their climate 

54 

 
 
     
 
and energy plans in 2023 according to their efforts up to then. In the pursuit of making European industries 
sustainable,  the  intention  is  to  stimulate  the  development  of  new  markets  for  climate  neutral  and  circular 
products and make all packaging recyclable or reusable by 2030.  

The European industrial strategy (European Commission, n.d.b) aims to ensure competitiveness on the global 
stage  via  investments  in  Strategic  Value  Chains  and  Industrial  Ecosystems  –  e.g.  batteries,  clean 
hydrogen and bio-based products – and new forms of collaboration with industry for ensuring Europe’s strategic 
autonomy and technological leadership. This strategy launched by the Commission in March 2020 is based on 
three  main  focus  areas:  the  green  transition,  global  competitiveness  and  the  digital  transition  (European 
Commission, 2020b). Designed to support all minor and major players, the newly presented strategy could be 
seen as a  cornerstone for all European industries as the  Commission aims to remove barriers to the single 
market for European  companies while also working toward  climate-neutrality. European SME’s will be given 
special attention in the new Industrial Strategy to support them in the green and digital transition by providing 
them  with  ‘bespoke  support’  such  as  sustainability  advisors,  digital  innovation  hubs,  trainings  and  a  skilled 
labour force. Some new future actions include: 

-  Action  Plan  on  Intellectual  Property  for  protecting  the  competitiveness  of  European  companies and 

innovators 

-  Action Plan on Critical Raw Materials and pharmaceuticals for supporting key enabling technologies 

and introducing a new Pharmaceutical Strategy 

-  White Paper on distortive effects caused by foreign subsidies in the single market and foreign access 

to EU public procurement and EU funding 

-  Alliances  on  clean  hydrogen,  low-carbon  industries,  industrials  clouds  and  platforms  and  on  raw 

materials (European Commission, 2020c) 

- 

- 

- 

Relating  to  the  energy  sector,  the  European  Green  Deal  includes  the  following  actions  to  be 
undertaken in order to make its ambitions reality: 

Interconnect energy systems and better link / integrate renewable energy sources to the grid 

Promote innovative technologies and modern infrastructure 

-  Boost energy efficiency and eco-design of products 

-  Decarbonise the gas sector and promote smart integration across sectors 

- 

- 

Empower consumers and help Member States tackle energy poverty 

Promote EU energy standards and technologies at global level 

-  Develop the full potential of Europe’s offshore wind energy 

- 

End subsidies for fossil fuels  

Future actions in mobility will only marginally affect manufacturing industries in the short term, but in the 
medium to long term require manufacturers of transport options to diversify their portfolio and redesign core 
concepts of production. One example is the push towards shared mobility models in which car-ownership will 
be discouraged. The Single European Sky Reform entails a 3-fold increase in capacity in air-travel which will 
require aerospace manufacturers to expand while also investing in the development of biofuels for aviation. At 
the end of 2020, the European Commission published also the Strategy for Sustainable and Smart Mobility 
(European  Commission,  2020j).  Following  this  strategy,  the  European  Commission  supports  strategic  value 
chains (for instance on batteries, hydrogen and renewable and low-carbon fuels) with regulatory and financial 
instruments. This is seen as essential to ensuring secure supply of technologies indispensable for sustainable 
and smart mobility, avoiding Europe’s dependence on external suppliers in strategic sectors to achieve greater 
strategic autonomy.  The  Hydrogen  Strategy for a climate-neutral Europe offers a solution to  decarbonise 
industrial processes and economic sectors where reducing carbon emissions is both urgent and hard to achieve. 
But  there  are  major  challenges.  Deploying  hydrogen  in  Europe  faces  important  challenges  that  neither  the 
private sector nor Member States can address alone. The broad application of hydrogen needs critical mass in 

55 

 
 
     
 
investment,  an  enabling  regulatory  framework,  new  lead  markets,  sustained  research  and  innovation  into 
breakthrough technologies and for bringing new solutions to the market, a large-scale infrastructure network. 
In order to address the issue of eliminating pollution the Commission presents several measures including a 
zero-pollution action plan which will target air, water and soil. Links will be made with other elements of the 
European Green Deal including sustainable industry. Specific measures will address pharmaceuticals, as well 
as chemicals, with the launch of a new chemical’s strategy for sustainability and a toxic-free environment.  

The European Climate Law: In March 2020 the European Commission presented its proposal for a European 
Climate  Law  (European  Commission,  2020d).  This  piece  of  legislation  goes  together  with  the  Commission’s 
European Climate Pact in which citizen consultation will play a larger role than for the Climate Law. This Climate 
Law proposal represents a “legally binding target of net zero greenhouse gas emissions by 2050” (European 
Commission, 2020d). The proposal also includes measures for tracking member states’ progress as these are 
expected to update their climate and energy plans in 2023 and every 5 years after according to their efforts 
up to then and further efforts undertaken by the Commission. Practically, the European Climate Law is designed 
to: 

-

-

-

-

-

interconnect energy systems of the future

promote innovative technologies and modern infrastructure

boost energy efficiency of consumer products

promote EU energy standards and technologies at global level

develop the full potential of Europe’s offshore wind energy

In  April  2021  the  European  Council  and  the  European  Parliament  agreed  on  the  European  Climate  Law 
enacting a binding guideline on both the net GHG emissions reduction target and with the goal of achieving an 
interim target of at least 55 percent minus compared to 2030 (European Council, 2021). 

The European Commission  aims to fund the Green Deal by mobilising over  EUR 1 trillion  for actions 
towards climate neutrality through its Sustainable Europe Investment Plan. Half of the resources is planned to 
come out of the EU budget directly and a quarter from public and private investment. The rest will come from 
Emission  Trading  Scheme  (ETS)  funds,  national  co-financing,  national  promotional  banks  and  international 
financial institutions (IFI). 7.5 billion of this will be new resources generated through corporate and private taxes 
as well as other funding mechanisms (e.g. carbon mechanism) (European Commission, 2020e). The ETS fund is 
especially significant to the industry’s role in accomplishing the Green Deal’s ambitions. It will generate new 
resources through investments in low-carbon technologies and processes in renewable energy, giving leverage 
to industry stakeholders with the potential to deliver in these areas.  

China just recently introduced its 14th 5 years plan 2021-25. According to a recent paper by the London 
School of Economics and Political Science China’s new Five-Year Plan “presents a real opportunity for China to 
link its long-term climate  goals with its  short- to medium-term  social and economic development plans.” In 
addition, “China’s recent commitment to achieving carbon neutrality by 2060 has set a clear direction for its 
economy, but  requires ratcheting up ambition on its near-term climate policy” (p. 2)  (Hepburn, et al., 2021). 
Other observers argue that the Chinese renewable energy sector is just one example of the dynamic increase 
in returns associated with disruptive technological change during the zero-carbon transition (CarbonBrief, 2021). 
The new plan covers six key areas of energy development, including the construction of eight large-scale clean 
energy  “bases”,  coastal  nuclear  power,  electricity  transmission  routes,  power  system  flexibility,  oil-and-gas 
transportation and storage capacity. Besides this, China is seen as one of the world manufacturing leaders of 
electric cars with enormous investments made (Donato, 2020). President Xi’s Made in China 2025 state-led 
high-tech  manufacturing  policy  strategy  has  started  developing  industries  including  electric  cars  and  rail 
transport. 

After Joe Biden has become president of the US in January 2021 a Green New Deal has come on the agenda. 
It seeks to fight the climate crisis and tackle inequality simultaneously and outlines the broad principles of a 
plan to achieve net-zero greenhouse  gas emissions across the US economy by 2030.  In addition, it aims to 
guarantee new high-paying jobs in clean energy industries (Snaith, 2021). According to information on President 
Biden’s own homepage the climate and environmental justice proposal will make a federal investment of $1.7 

56 

billion39 over the next ten years, leveraging additional private sector and state and local investments to total to 
more than $5 billion (The Biden Plan for a Clean Energy Revolution and Environmental Justice, n.d.). Just recently, 
President Biden issued a number of executive actions addressing climate change, for instance a rejoining the 
Paris Agreement and a global pact to reduce emissions and plans to electrify the federal government’s fleet of 
vehicles. According to a recent article by the Council on Foreign Relations “the Green New Deal, (is) a broad and 
sometimes  vague  aspiration  to  rapidly  mobilize  American  government,  society,  and  industry  to  create  a 
sustainable, low-carbon future. It has become hotly contested among policymakers. For supporters, such an 
effort represents a last chance to avoid the worst consequences of catastrophic climate change. For detractors, 
it’s  a  financially  profligate  proposal  concerned  more  with  traditional  left-wing  economic  policies  than 
environmental  necessity.”  (Chatzky  &  Siripurapu,  2021).  Further  actions  by  the  newly  elected  US  president 
reaffirm the US´s return to the sustainability pathway. In April 2021 the US invited 40 leaders of economies 
that  account  for  a  majority  of  global  emissions  and  GDP  as  well  as  “heads  of  other  countries  that  are 
demonstrating strong climate leadership, are especially vulnerable to climate impacts, or are charting innovative 
pathways to a net-zero economy” to the Leaders Summit on Climate (The White House, 2021). The Summit 
aims to bundle efforts in fighting against the climate change (U.S. Department of State, 2021). 

4.2  Main drivers and barriers 

The main drivers for investing in technologies relevant for Europe's Green Deal are climate change, the need 
for  transformation  of  industries,  new  regulation  and  the  expectation  of  new  prosperous  business  and 
competition.  The  need  for  cross-sectoral  and  cross-technological  innovation,  unclear  new  markets,  a  new 
political framework and acceptance in society are the main barriers. The European Green Deal has in general a 
strong support by industrial companies.40 But there is still a strong need that some new framework conditions 
have to be clarified and coordinated as a multi-level governance with the respective Member States’ strategies. 
The application of hydrogen supply in energy intense industries needs policy support short- to medium-term to 
ensure international competitiveness. Market shaping in democracies for sustainable industries, green energy 
and green mobility needs highly relevant incentives for major industrial transformations in a highly competitive 
global  environment.  Mostly  state-run  economies in  non-democratic  countries like  in  China  are  certainly  in  a 
different  position  since  acceptance  in  economy  and  society  is  not  necessarily  needed.  Since  the  US  is 
characterized by decentralized organization and a strong concentration of innovations from the private sector 
like in electrical mobility and batteries it is quite difficult to analyse the influence of the policy context with a 
just started Green New Deal. 

4.3  Policy  toolbox  for  R&D&I  policies  supporting  technologies  relevant  for 

Europe's Green Deal 

Global Innovation Networks and the European Green Deal 

Organisations  like  European  Batteries  Alliance  or  Fuel  Cell  and  Hydrogen  2  Joint  Undertaking  are  Global 
Innovation Networks of industry actors and other stakeholders such as academia and public institutions that 
facilitate and/or promote innovation.41 Their value becomes apparent when they allow an understanding of e.g. 
firms’ relocation decisions or their choice of public-private partnerships. GINs exist within their Global  Value 
Chains (GVCs), where R&D&I processes are becoming more and more widely dispersed, and this dispersion is 
occurring more and more quickly (Dosso, Potters, & Tübke, 2017). GINs provide a comprehensive understanding 
of  innovation  drivers  and  hampers.  GINs  allow  for  a  historical  as  well  as  projective  analysis  of  companies’ 
locational,  operational,  and  strategical  choices  and  their  position  in  GVCs  (Herstad,  2014;  Dosso,  Potters,  & 
Tübke, 2017). Following this definition, we distinguish between four key building blocks of the GINs related to 
the European Green Deal:  

- 

Technological maturity  

39 The term billion used as on the European level. A European billion is a trillion in the U.S. 
40 This is one result of the interviews conducted for this study. 
41 For a detailed discussion see Deliverable 2. 

57 

 
 
     
 
 
                                           
- 

Potential for growth  

-  High potential related to the European Green Deal (circularity or low carbon) 

- 

Framework conditions (policy, finance, network, geography) 

Figure 42: Key building blocks of the Global Innovation Networks (GINs) related to the Green Deal 

Source: IDEA Consult 

The  current  policy  context  and  its  conditions  have  enabled  the  technology  development  in  GINs  in  areas 
important for the Green Deal linked with the SDGs through targeted programmes and policy instruments. This 
also  means  these  GINs  are  sufficiently  connected  to  incorporate  elements  of  the  European  Green  Deal.  In 
addition, available funding resources from outside of the  company are a key to  unlocking the technological 
solution  developed.  Furthermore,  regulation  aspects  can  be  discussed  already  in  a  quite  early  stage  of 
development. 

The SPIRE Public Private Partnership is one good example of a GIN connecting many companies from the process 
industries  on  green  technologies.  Many  companies  active  here  have  developed  their  own  sustainability 
assessment  and  use  it  also  for  evaluation  and  merger  and  acquisitions,  but  further  harmonisation  of  the 
different  sustainability  measurement  approaches  is  necessary.  Additional  good  examples  are  the  European 
Battery Alliance (EBA), European Renewable Energies Federation (EREF), European Clean Hydrogen Alliance or 
the Fuel Cells and Hydrogen Joint Undertaking (FCH JU). 

The rationale behind new policy instruments 

In recent years, there has been an enormous increase in the research literature around innovation and industrial 
policy.42 There are several prominent arguments concerning the rationale for innovation and industrial policy 
(the “Why?”).  One argument is that innovation policy is necessary because of  market failure. This argument 
continues to be influential among policymakers and justifies funding basic public research (Edler & Fagerberg, 
2017). Other authors question the adequacy of this approach for justifying and guiding the design, financing 
and implementation of innovation and industrial policy (Mazzucato & Semienuk, 2017). Another argument is 
that innovation needs to be effectively coordinated. According to this line of thinking, strengthening innovation 
systems  ensures  positive  impacts  for  business,  society  and  the  regions.  In  addition,  there  is  a  prominent 
argument that path dependencies in innovation prevent change in the long run (Edler & Fagerberg, 2017). These 
necessary changes can be supported by new forms of innovation and industrial policy, such as open dialogues 
between established and new innovation actors and sectors in pro-active regions and across sectors (Nepelski 
& De Prato, 2012). 

42 For a summary Malanowski, N. & Tübke. A. & Dosso, M. & Potters, L. (2021). Deriving new anticipation-based 
policy instruments for attracting research and development and innovation in global value chains to Europe, 
Futures,  128  (4),  1-12  and  Borras,  S.  &  Edquist,  C.  (2019).  Holistic  Innovation  Policy.  Oxford  University 
Press. 

58 

 
 
     
 
 
 
 
                                           
It should be underlined that these policies have been more focused on creating and shaping markets through 
direct and pervasive public financing than on market fixing (Mazzucato & Semienuk, 2017; d´Andria & Savon, 
2018; Mazzucato M. , 2018). This means that instruments are changed and combined with other instruments 
in order to address the  new  (and sometimes ‘old’)  problems and challenges of innovation and industry (e.g. 
linked with the European Green Deal). The ability of public financing of innovation to shape and create markets 
makes it even stronger as a strategic tool. Mazzucato & Semienuk (2017) stress three features when looking 
at the public financing of innovation and the way it can shape and create markets: 

- 

- 

- 

investment along the entire innovation chain 

the mission-oriented nature of the agencies involved and 

their leading role in risk-taking, independent of the business cycle. 

This market-shaping approach suggests that the use of policy instruments must be “proactive and bold, creating 
directions  and  transcending  the  role  envisaged  by  market  or  social  system-fixing  approaches”  (p.  44).  The 
properties of innovation in a new era of industry seem to be highly uncertain, cumulative and collective, with 
very long lead times (Grilli, Mazzucato, Meoli, & Scellato, 2018). Just recently, the Commission of Experts for 
Research and Innovation (EFI) argued that the agility of policy is another important prerequisite for successfully 
implementing the transformative change desired by society (Commission of experts for research and Innovation 
(EFI), 2021). 

In recent years, there has also been an increase in the research literature on linking foresight  with innovation 
policy  instruments  (Malanowski, Tübke,  Dosso,  &  Potters,  2021;  Gordon,  Ramic,  Rohrbeck,  &  Spaniol, 2020). 
Saritas (2018)  describes foresight in a  period of transition.  In his  view, foresight activities have changed in 
content, context and process. Concerning the quest for more resilient science, technology and innovation policy, 
foresight  exercises  "have  become  more  inclusive  with  the  participation  of  broader  experts  and  social 
stakeholders” and indicate a coherent and complementary innovation ecosystem. Saritas observes changes in 
demand in the use of foresight for science, technology and innovation policy. He suggests “experiential foresight 
as a novel means of generating knowledge and communicating results” (p. 4), and the use of laboratories for 
promoting anticipation. Havas et al. (2018) conclude that in a strategic sense, foresight is expected to influence 
the wider (new) innovation ecosystem in which these specific programmes and initiatives are embedded. This 
is  also  the  case  for  using  new  anticipation-based  policy  instruments  linked  with  the  European  Green  Deal. 
Malanowski et al. (2021) discuss new anticipation-based policy instruments to improve the attractiveness of 
Europe for innovative activities in a world of accelerating innovation. From their point of view the world economy 
has  changed  significantly  in  complexity  and  in  accelerating  innovation.  Innovation  and  foresight  labs  have 
according  to  this  article  a  highly  experimental  but  also  a  game-changing  character  in  highly  innovative 
companies  while  early  signs  of  developments  are  addressed.  They  argue  that  the  same  is  needed  for  an 
ambitious  policy  to  upgrade  the  EU’s  R&D&I  capabilities  by  shaping  a  process  for  engaging,  anticipating, 
assessing and responding on an ongoing basis. 

A review of the recent literature shows that innovation and industrial policy consists of various instruments. 
Borras  &  Edquist  (2013)  suggest  three  categories  of  instruments  (regulatory  instruments,  economic  and 
financial instruments, and soft instruments) and point out that the three-fold division is most accepted in the 
literature on innovation policy instruments. Borras and Edquist observe that most of these instruments influence 
the development and diffusion of innovations from the supply side rather than from the demand side. From 
their point of view, instruments focusing more on the demand side might have the advantage of redressing 
specific types of weaknesses. In particular, a new type of instruments – often called soft instruments – might 
be able to address different and new aspects of the innovation and industrial system challenged by a number 
of deep transformations and technology breakthroughs. Borras and Edquist conclude that the design of the mix 
of instruments must include ultimate objectives which support private organisations and companies in solving 
problems in the field of innovation that they cannot solve on their own. 

Most of the interviewed actors are organized in quite a number of networks. Some of these networks are on a 
national level, but the majority is operating on an international level. All technologies  the actors of the GINs 
work  on  are  to  a  certain  degree  related  towards  the  European  Green  Deal.  The  case  studies  of  GINs  and 
interviews  with  company  representatives  collected  for  this  deliverable  show  not  just  a  strong  support  by 

59 

 
 
     
 
industrial companies for the European Green Deal but also a high level of interest in new anticipation-based 
policy instruments. 

Regulations 

In general, the existing policy context acts as enabler for the GINs and their related technologies. In some cases, 
the policy tools seem to have no visible impact on the acceleration of the technologies market entry according 
to  the  interviewees.  The  European  Green  Deal  itself  is  seen  as  enabler  since  it  provides  important  signals 
especially for the net zero target. Furthermore, regulations are seen on the one  hand, as having a negative 
impact on conventional business sectors, such as the EU ETS which rises the price for CO 2. On the other hand, 
regulations lead  – according  to most interviewees  - to benefits for sustainable and strongly transformative 
sectors. Many guidelines and policies are seen as still under development and conditions are seen as subject to 
further changes. Most regulations and their effects are seen as not fully evaluated, because of the difficulty to 
evaluate  whether  regulations  act  as  a  market  barrier or  enable  growth  for the  concerned  sector.  Generally, 
regulations  for recycling  and  materials technologies are  seen  as enabler  for  growth.  It  was  mentioned  that 
without  a  push  for  electric  cars,  there  would  be  no  drive  for  the  need  for  improved  batteries.  From  the 
interviewees  perspective  there  are  many  opportunities  for  regulation  to  further  improve  the  framework 
conditions, e.g. for circular economy business models. 

The interviewees provided also a number of specific recommendations for policy. EU regulations like the RED II 
directive or high-level signals like the net-zero target and the Innovation Fund induce growth within the mobility 
sector. But there exists also a framework that acts as a market barrier to new companies. As improvements to 
existing policy instruments to support a development towards a more climate neutral production and R&D&I 
sector it is suggested that the EU should formulate and communicate clear objectives that have to be reached 
(e.g. specific share of renewables in specific sectors). 

The political instruments regarding sustainable technologies are seen as high and useful on both national and 
international  level.  Policy  regulations  are  usually  precisely  observed  and  rated  as  positive  framework.  The 
current framework is seen as an enabler for growth and a chance to increase competitiveness. The speed of 
policies in Europe is seen as too slow to get started necessary actions to initiate concrete activities in a timely 
manner. 

Economic and financial transfers 

The interviewees do not report the existence of a funding gap in general. Some interviewees noted the existence 
of uncertainties in their environment that negatively impact investment activities in sustainable technologies. 
Further  investments  in  sustainable  technologies  are  seen  as  positive  since  the  gap  between  necessary 
investments to reach climate objectives and actual investments is still increasing.  Already existing financial 
guidelines  and  funding  instruments  are  seen  as  beneficial  for  the  transformation  towards  a  sustainable 
economy, such as CCFD or the EU Innovation fund.43 The interviewees stressed that public and private funding 
is an important aspect for the success of an emerging technologies linked with the European Green Deal. Most 
projects analysed in this study, are partly funded by public authorities. 

For an almost carbon neutral industry is the increased availability of renewable energy necessary as well as 
low emission hydrogen in large amounts and at economically feasible prices. The interviewees stressed that 
the  more  affordable  renewable  energy  is  available  to  industry,  the  more  carbon  free  technologies  can  be 
introduced into production processes. Climate ambitions and carbon pricing policies would need to rise globally 
at  a  similar  level  to  avoid  developing  market  disruption  and  difficult  export  strategies.  EU-wide  funding 
structures  could  help  MNEs  and  SMEs  quickly  shifting  investment  priorities  to  sustainable  technologies. 
According to the interviewees there is currently no effective EU-wide policy framework to allow for the industrial 
transition. The EU emissions trading system (EU ETS) ensures a reduction of carbon emissions, but risks to drive 
old  technologies  out  of  the  market  before  they  can  be  substituted  by  new  installations.  The  ETS  could  be 
supplemented  and  reinforced  by  additional  policy  tools  that  increase  investment  security  for  MNEs  and 
furthermore  encourage  the  market  to  spend  resources  for  the  development  and  rollout  of  carbon-free 

43 A number of interviewees stated that they support the efforts by the European Commission to bring clarity and 
transparency on environmental sustainability to investors, companies and issuers. From their point of view 
the  development  of  a  common  language  (EU  Taxonomy)  could  enable  knowledgeable  decision-making  to 
foster investment in environmentally sustainable activities and technologies like hydrogen. 

60 

 
 
     
 
                                           
technologies.  It  was  underlined  that  carbon  border  adjustment  mechanism  can  only  be  an  improvement,  if 
competitiveness both on the EU market and for exports can be assured and there is full protection along the 
whole value chain up to end consumer products.  

Soft instruments  

The  interviewees  provide  some  proposals  to  currently  existing  political  instruments  and  industrial  policy 
regarding the development towards a climate neutral production and R&D&I sector. Concerning the existing 
political instruments regarding the development towards a climate neutral production it is suggested improving 
the dialogue between all necessary stakeholders. To increase the permeability of regulations it is important to 
involve all relevant actors and to make sure not to alienate them. Besides this, partnerships are seen as needed 
to jointly being able to address the challenges of the European Green Deal. Furthermore, some interviewees 
stated that the speed of starting and also stopping R&D&I activities has to increase in a more dynamic, agile 
and responsive system. It was also stressed that every state and every industry (no matter their size) in Europe 
should have an active part in the current energy and industrial shift based on the European Green Deal. 

4.4  Policy implications  

Implementing the European Green Deal and transforming industry in the EU by using anticipation-based policy 
instruments requires concrete and additional instruments. An outline of options for adjusting and expanding 
current instruments for EU industrial and R&D&I policies is provided in the form of a concise anticipation-based 
policy toolbox. It should be kept in mind here that the companies and GINs interviewed (green energy, green 
mobility, sustainable industry, hydrogen, batteries) and analysed for this study represent a strong trend towards 
collaborative R&D&I and innovation networks. The anticipation-based policy toolbox below shows instrument 
categories and combinations of all of them in new or adjusted policy instruments. In addition, this outline based 
on the case studies and interviews provides options for how public authorities at different levels can address 
the current opportunities and challenges for innovation and industry related to the European Green Deal and 
the SDGs. Figure 43 shows three classic categories of policy instruments: regulations, economic, and financial 
instruments, and soft instruments. The tradition is that they are discussed separately which does not make that 
much  sense  when  looking  on  new  instruments.  These  new  instruments  are  quite  often  ‘three  in  one’  which 
means  that  they  consist  of  regulations,  economic,  and  financial  instruments,  and  soft  instruments.  This 
phenomenon can be found for instance in Public Private Partnerships like SPIRE or Fuel Cells and Hydrogen Joint 
Undertaking (FCH JU). It can be also found in innovation alliances like European Battery Alliance or European 
Clean Hydrogen Alliance.  

61 

 
 
     
 
 
 
Figure 43: Policy instruments – three in one 

Source: VDI TZ 

As described by the European Commission (2020b) in the new industrial strategy efforts at the European level 
need to be matched by national and regional reform efforts. There is a need to join forces behind a holistic and 
comprehensive strategy for industrial competitiveness linked with the anticipation-based policy toolbox and the 
options for policy instruments discussed above. In addition, a number of these ‚three in one instruments’ are 
already being used in a systematic way at the national. 

Germany, for instance, operates with two, new innovation and industrial policy instruments at the national level. 
Real-world laboratories and experimental rooms are both “hard” and “economic-promoting” as well as “soft” 
anticipation-based  innovation  and  industrial  policy  instruments.  They  are  generally  speaking  “three  in  one”. 
Currently,  they  can  be  found  in  Green  Deal  related  fields  like  hydrogen  and  batteries.  They  are  aimed  at 
regulating  and  promoting  measures  (such  as  public  funding  programs)  as  well  as  dialogue  processes.  They 
differ in a few key points: The real-world laboratory initiatives currently either focus on the energy transition 
with a targeted focus like hydrogen or they are open to innovation in various industries. In both cases, the focus 
is  on  innovative  products,  processes  or  services,  the  development  of  business  models,  prospective  market 
penetration and regulatory learning. The thematic focus of experimentation rooms is on work models, internal 
structures, employee development and employment formats. With a view to employees, works councils and 
trade  unions,  they  are  more  participatory  and  have  a  stronger  dialogue  orientation.  “Hard”  innovation  and 
industrial  policy  instruments  are  particularly  relevant  for  legislation  and  its  further  development.  Both  in 
practical tests and in “laboratory environments” - partly determined ex ante, partly as an (interim) result of the 
experimental work - regulatory issues are raised and dealt with. 

Real-world laboratories or experimental rooms are expressions of the proactive use of new anticipation-based 
innovation and industrial policy instruments used for instance in German speaking countries.  They can also 
open  up  new  (co-)  design  perspectives  and  innovative  participation  formats  for  employee  actors  if  there  is 
clarity about the goals, project structures and means as well as the actors involved. The worlds of innovation 
and work are currently in a profound transformation process linked with the European Green Deal. Job profiles, 
customer needs and qualification needs, etc. change significantly. Technical innovations offer the potential for 
more efficient and simplified work processes. Employee skills are to be continuously developed. Companies and 
their workforces usually need to be able to react quite quickly and flexible to changing requirements resulting 
from  the  European  Green  Deal.  New  and  modified  anticipation-based  innovation  and  industrial  policy 
instruments such as real laboratories and experimental rooms offer the opportunity to flexibly test technical 

62 

RegulationsSoft instrumentsEconomictransfers…Real time laboratoriesExpertimentationroomsPublic Private Partnerships Innovation alliancesThreein one 
 
     
 
 
and  social  innovations,  business  models  and  new  or  modified  internal  processes  within  an  initially  limited 
framework, to evaluate them scientifically and to adapt them as required. 

Since the GINs and companies analysed in this study are active in different sectors but also cross-sectoral, it is 
suggested that the anticipation-based  policy instruments  and options discussed here  will be linked with the 
future sectoral initiatives organised within the framework of the smart specialisation strategies for sustainable 
and inclusive growth  This gives numerous established and new stakeholders from business, politics, science 
and society from different Member States and regions, the chance to develop bright ideas for new products, 
services and processes related to the European Green Deal and to work in a well-structured, open-minded and 
inter-sectoral environments. 

63 

 
 
     
 
 
5  Conclusions 

This study analysed the EU’s R&D&I competitiveness and Global Innovation networks in the framework of the 
European Green Deal to provide evidence for the potential of European industries to become carbon neutral 
while simultaneously ensuring job security. Research was focused on three identified Green Deal priority areas, 
industry, energy and mobility and two cross-sectoral areas, hydrogen and batteries.  

The EU has certainly a strong competitive position within the Green Deal priority areas, especially when focusing 
on  R&D expenditures  on  country  level.  Yet,  on  company  level  US  companies  on  average  invest  more  in  the 
energy  sector  whereas  Japanese  companies  have  higher  expenditures  on  firm level  in  the  industrial  sector. 
Although Chinese firms’ expenditures are,  compared to other sectors, relatively modest, Chinese firms  have 
displayed a high growth in R&D investments within the past years. If this trend is to continue, Europe might 
face strong competition from non-EU actors. With respect to funding, on country level US start-ups are best 
equipped in most sectors, except for the steel sector where EU start-ups receive the highest amount of private 
equity funding. In terms of patenting activities, Japanese and EU firms are strong key players in all Green Deal 
Priority Areas.  

The EU is well positioned in the mobility sector, where established EU companies are ranked highest in  R&D 
intensity as well as in total R&D investments on both country and firm level. At the same time, private equity 
funding in innovative mobility technologies is highest for the US and China. Furthermore, Chinese mobility start-
ups receive the highest average funding, followed by Japanese start-ups. In the energy and industrial sector, 
EU  companies are  highly prevalent among the top R&D investing firms. In both sectors, EU  companies also 
display the highest R&D investments on country level. On firm level, R&D investments in the industrial sector 
are highest for Japanese companies, whereas US firms on average have leading positions in the energy sector. 
It  can  be  concluded  that  EU  actors  are  increasingly  focussing  on  the  development  of  alternative  energy 
solutions,  whereas  companies  in  China  and  ‘RoW’  are  displaying  increasing  efforts  in  the  development  of 
conventional energy solutions but are also broadly positioned due to recently increasing R&D investments in 
the renewable energy sector. 

Being a member organized in a Global Innovation Network (GIN) is beneficial for companies in each sector since 
it allows the engagement with different types of stakeholders and provides access to a diverse skill set, reduces 
investment risks by spreading efforts and promotes synergies between specific areas towards a wider research 
area.  This  form  of  organization  has  a  positive  impact  on  innovation  activities.  To  further  promote  the 
development  of  climate  neutral  production  within  GINs,  clear  policy  guidelines  that  provide  higher  planning 
security are necessary.   

The EU is already on the path to a successful transformation. Yet some factors that are enabling or hindering 
R&D&I  policies  supporting  the  sustainable  transition  have  been  identified.  In  the  current  EU  policy  context, 
regulations are seen as having negative impact on conventional business, such as the EU ETS which increases 
the  price for CO2 leading to  less competitiveness for CO2 intensive  business models.  At the same time, an 
appropriate regulatory framework is the cornerstone of the new Industry Strategy for a green and competitive 
EU industry and can lead to benefits for sustainable and transformative sectors and technologies. To enable 
sustainable and transformative sectors and technologies, the speed and agility of policies in EU needs to be 
improved. Economic and financial guidelines are seen as beneficial for the transformation towards a sustainable 
economy. 

A mix of policy instruments that supports companies in their transition is needed. Instead of just focussing on 
the three classical categories of policy instruments (regulations, economic and financial instruments and soft 
instruments) separately, it is reasonable to use additionally ‘three in one’ instruments. This combination of policy 
instruments  to  support  sustainability  efforts  in  GINs  is  already  used  in  several  European  Public  Private 
Partnerships  or  alliances.  The  new  industrial  strategy  efforts  at  the  European  level  need  to  be  matched  by 
national and regional policy efforts. There is also a need to join forces behind a holistic and comprehensive 
strategy for industrial competitiveness linked with the anticipation-based policy strategy and the options for 
policy instruments discussed above. 

While  pushing  its  Green  Deal,  Europe's  innovation  and  economic  conflicts  with  both  the  US  and  China  will 
become more prominent. At the same time, the US and China are in competition with one another for supremacy 
in emerging technology and economic fields. For these countries, the protection of (own) new green technologies 

64 

 
 
     
 
and  markets  have  the  highest  priority.  Both  countries are  already  quite  open  about  their  disputes  with  one 
another, but also to a certain extent with the EU – the US for instance by establishing trade barriers to protect 
their own economy (e.g. steel), China for instance by restricting FDI domestically or by enacting new laws to 
protect new technologies (e.g. batteries).  

It  is  already  clear  today  that  emerging  technology  fields  are  increasingly  associated  with  new  or  modified 
innovation and industrial policy instruments are being implemented or close to (Bullinger & Malanowski, 2021). 
This happens in the global competition context for international technology leadership described above. Such 
instruments  usually  have  a  distinctly  experimental  character.  Real-world  laboratories  and  experimentation 
rooms, in connection with green technologies in sectors like energy, industry and mobility offer the opportunity 
to  test  technical  and  social  innovations  or  changed  internal  processes  specifically  within  an  initially  limited 
framework  and  to  adapt  them  as  required.  They  can  also  be  used  to  shape  qualification  requirements  and 
employment formats in a direct exchange with other innovation and industry  players and policymakers in a 
future-oriented manner. 

For employee actors from industry, this can open new design perspectives and innovative participation formats 
to create robust industries for the next decade. The discussion of critical perspectives brought in by employees 
must  be  adequately  taken  into  account  when  discussing  the  new  deeply  transformative  developments.  In 
contrast to the US and China, workers' actors in Europe are seen as competent and critical contributors to the 
transformation of industries (Malanowski N., 2021). This expertise needs to be used in a targeted manner for 
pushing ambitiously the Green Deal in Europe and its broad acceptance in society and economy. The window of 
opportunities for doing this is open for the next years but fierce competition with the US and China in this field 
might reduce the time for proactive innovation and industrial policy on the one hand. On the other hand, climate 
change might be faster as predicted after the Covid-19 pandemic and climate neutrality is needed earlier. Due 
to  these  possible  limited  opportunities,  it  could  happen  that  future  R&D&I  policies  supporting  technologies 
relevant for Europe's Green Deal might be reactive instead of pro-active. 

65 

 
 
     
 
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List of figures 

List of Figures 

Figure 1: Overview of project tasks, results and deliverables .................................................. 11 

Figure 2: Visualization of the methodological approach. ....................................................... 12 

Figure 3: Top-20 European patenting firms by number of green patents (mobility sector) ................. 13 

Figure 4: Number of firms among the top-100 patenting firms by Green Deal area and world region .... 14 

Figure 5: Number of companies in the Scoreboard by region and Green Deal priority area ................. 18 

Figure 6: Evolution of GHG emissions across selected EIIs and the EU as a whole .......................... 20 

Figure 7: Number of Scoreboard companies by country, Industry ............................................. 21 

Figure 8: Graphical illustration of the Global Innovation Network, MNE 2 .................................... 23 

Figure 9: Graphical illustration of the Global Innovation Network, MNE 3 .................................... 23 

Figure 10: Graphical illustration of the Global Innovation Network, MNE 4 ................................... 24 

Figure 11: Key decarbonisation solutions by sector............................................................. 25 

Figure 12: Total R&D investment by region, Industry (in EUR Mio.) ............................................ 27 

Figure 13: R&D intensity by 5 main regions, area industry (shares) ........................................... 28 

Figure 14: Number of foundations per year, steel sector ...................................................... 28 

Figure 15: Total and average amount of funding (Mio. USD), steel sector .................................... 29 

Figure 16: Number of foundations per year, chemical sector .................................................. 29 

Figure 17: Total and average amount of funding (Mio. USD), chemicals sector .............................. 30 

Figure 18: Number of Scoreboard companies by country, Energy ............................................. 31 

Figure 19: Mean operating profit, alternative energy and renewable energy equipment sector, in Mio. EUR32 

Figure 20: Mean operating profit, conventional energy, in Mio. EUR ........................................... 32 

Figure 21: Graphical illustration of the Global Innovation Network, SME 2 ................................... 34 

Figure 22: Depicting the BBI JU GIN: Location of BBI JU projects, partners, demonstration plants and flagship 
plants ............................................................................................................... 34 

Figure 23: Share of EU energy production by source, 2018 .................................................... 35 

Figure 24: Total R&D investment by region, Energy (in EUR Mio.) ............................................. 36 

Figure 25: Number of employees employed by companies from 5 main regions, energy sector (in thousands, 
change) ............................................................................................................. 37 

Figure 26: Number of foundations per year, energy sector .................................................... 37 

Figure 27: Total and average amount of funding (Mio. USD), energy sector .................................. 38 

Figure 28: Number of Scoreboard companies by country, Mobility ............................................ 39 

Figure 29: Graphical illustration of the Global Innovation Network, SME 1 ................................... 41 

Figure 30: Graphical illustration of the Global Innovation Network, MNE 1 ................................... 41 

71 

Figure 31: Graphical illustration of the Global Innovation Network, MNE 8 ................................... 42 

Figure 32: Total R&D investment by region, mobility sector (in EUR Mio.) .................................... 44 

Figure 33: Total R&D investment by region, mobility sector (shares) ......................................... 44 

Figure 34: Number of employees employed by companies from 5 main regions, mobility sector (in thousands, 
change) ............................................................................................................. 45 

Figure 35: Number of foundations per year, mobility sector ................................................... 46 

Figure 36: Total and average amount of funding (Mio. USD), mobility sector ................................ 46 

Figure 37: Ambitious scenario for hydrogen deployment in the EU ........................................... 48 

Figure 38: Number of foundations per year, hydrogen sector ................................................. 49 

Figure 39: Number of foundations per year, battery sector .................................................... 49 

Figure 40: Total and average amount of funding (Mio. USD), hydrogen sector ............................... 50 

Figure 41: Total and mean amount of funding (Mio. USD), battery sector .................................... 50 

Figure 42: Key building blocks of the Global Innovation Networks (GINs) related to the Green Deal ....... 58 

Figure 43: Policy instruments – three in one .................................................................... 62 

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