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EU's Environmental Technologies Action Plan

3 Institutional Processes

3.1 The Lisbon Process
   3.1.1 Implementation of the Lisbon Strategy
   3.1.2 Review of the Lisbon Strategy
3.2 Environmental Technologies Action Plan (ETAP)
   3.2.1 Background of ETAP
   3.2.2 ETAP
   3.2.3 Implementing ETAP
3.3 Enlargement

This chapter aims at describing relevant ongoing political processes including the Lisbon Strategy and the overall agenda of growth and employment in order to put the European Environmental Technologies Action Plan (ETAP) in context of the existing processes and policies. The functioning of the Open Method of Co-ordination (OMC) is also briefly touched upon, as this method has been foreseen to be used for the implementation of ETAP.

3.1 The Lisbon Process

In March 2000, at the Lisbon Summit, the European Council set a new strategic goal for the Union in 2010: 'to become the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion'. The focus was essentially on social and economic objectives.

The Stockholm European Council in Spring 2001 decided that an EU sustainable development strategy (SDS) should add an environmental dimension to the Lisbon Strategy. An annual review by each Spring Summit of the Community's progress in meeting sustainable development objectives would take place building upon the existing Lisbon process for reviewing and steering EU and Member State economic and employment policies, by adding an environmental dimension to the procedure.

It has therefore been decided that the yearly Spring Summits are to evaluate the implementation of the Lisbon objectives and the SDS on the basis of the Commission's annual Spring Reports. The Summits are to be based on these reports, which are in turn based upon regular, separate policy reviews and guidelines produced each autumn by the Economic and Finance, and Employment Councils. As a contribution to the environmental part of the Spring Reports, the Commission has been asked to produce an annual environmental policy review and a stocktaking of the Cardiff Process (the process of integrating environmental concerns into sectoral policies).

However, the role given to the Spring Summit in terms of steering and reviewing the SDS is not being reflected in practice, with political priorities instead focusing on economic and social issues, within the Lisbon Strategy. For this year's Spring Summit, the environment policy review [1] did not materialise until December 2003 – too late to be included in the drafting of the Spring Report and the Cardiff stocktaking was published after the Summit, namely in June 2004. So as in previous years, this year's Spring Report focuses mainly on the economic and employment aspects of the Lisbon process.

In relation to R&D, the process was strengthened in the 2002 Barcelona European Council, where it was agreed that overall spending on R&D in the EU should increase and approach 3 % of Gross Domestic Product (GDP) by 2010 - significantly higher than the current 2.1%, which is much lower than that of the US or Japan.

3.1.1 Implementation of the Lisbon Strategy

It was decided at the European Summit in Lisbon 2000, that the Lisbon strategy should be implemented via a new 'Open Method of Co-ordination' (OMC). The OMC is a method that was introduced in the Maastricht Treaty, notably to ensure the coordination of economic policies at the European level.

The OMC can involve elements of benchmarking, peer reviews, regular reporting, and the development by the Commission of voluntary guidelines for the Member States. These elements can be regarded as 'soft' instruments in comparison with the Community Method (CM), which relies on setting 'hard' legally binding standards for achieving goals.

The OMC is now used on a number of policy areas – ie economic and employment policies as well as innovation policies and pension policies - with the aim is to help Member States to progressively develop their own policies. New areas for using the OMC are being explored including the environmental policy field. When the Commission in December 2003, published their Environment Policy Review, the idea of introducing some form of OMC in the environment field was further articulated.

In order to increase investment in European R&D towards the 3 % of GDP by 2010 target agreed in Barcelona, the Commission in September 2002 published the Communication [2], More research for Europe - Towards 3 % of GDP. On the basis of feedback on the Communication from Member States, industry and other stakeholders, and on recommendations from independent experts, the Commission in April 2003 adopted the action plan Investing in research [3]. The action plan identifies ongoing initiatives relevant to the 3 % objective, and new actions to be undertaken at national and/or European level.

In March 2003, the European Council also agreed that OMC was to be used to pursue the 3% objective. One of the elements of the action plan was therefore a suggestion on how to make an appropriate framework for the monitoring, reporting and benchmarking needs related to the target. A set of 22 indicators was proposed to help monitor and report on progress towards the target and annual reports should be available in mid-November to feed into the Commission Spring Reports (meaning that Member State information would have to be available two months before).

3.1.2 Review of the Lisbon Strategy

A Lisbon Strategy mid-term review is foreseen to take place during 2005 under Luxembourg's EU Presidency. In accordance with the conclusions of the March 2004 European Council, the Commission has set up a High-level Group on the Lisbon Strategy, to be chaired by Mr Wim Kok, former Prime Minister of the Netherlands.

The Group is to look into ways of injecting fresh stimulus into the Lisbon strategy, in particular by improving delivery of the objectives set and by involving Member States and stakeholders more closely. It will also be assessing the instruments and methods used so far. It is to report to the Commission by 1 November 2004, in order to help the Commission in preparing proposals for the mid-term review of the Lisbon strategy to be included in the Commission's Spring 2005 report.

The Dutch Presidency has committed to facilitate the work on the mid-term review of the Lisbon Process during their Presidency with a clear focus on lifting the administrative burden on industries.

A larger review of the EU SDS was, according to the Commission's 2004 Work Programme, to be published for consultation in May 2004 although this timetable has slipped. Little information is currently available on the content and the possible link between these two reviews. It seems most likely that the SDS review will be not be adopted until there is a new Commission is in place, which is expected for after 1 November 2004.

3.2 Environmental Technologies Action Plan (ETAP)

3.2.1 Background of ETAP

In Stockholm, when the European Council decided on an EU SDS, it was also decided that:

'The European Council will accordingly review at its Spring meeting 2002:

  • progress in integrating the sustainable development aims into the Lisbon strategy;
  • the contribution that the environment technology sector can make to promoting growth and employment.'

Work on the Plan began in 2001 and in 2002 the Commission produced a report [4] that outlined the environmental technologies market, including some of the barriers to their development.

Following this the Commission produced a further communication [5] in March 2003. The aim of this communication was to deepen discussions on the content of the Action Plan by setting out a number of measures and questions as a basis for discussions.

At the same time the Commission set up four stakeholder groups to look at the potential of environmental technologies for four particular issues. The four issues selected for investigation were:

  • climate change (including energy and transport)
  • soil
  • sustainable production and consumption
  • water

Each of these stakeholder groups have produced studies, which have provided input for the plan. These studies can be found on the Commission webpage: http://europa.eu.int/comm/environment/etap/developing.htm

3.2.2 ETAP

On 28 January 2004, the Commission adopted an Environmental Technologies Action Plan [6] (ETAP) with the aim of harnessing the full potential of environmental technologies to reduce the pressures on natural resources, improve the quality of life of European citizens and stimulate economic growth. In the Plan it was emphasised that ETAP is a contribution to the EU Sustainable Development Strategy and to the Lisbon Strategy.

The objectives of the ETAP are to remove the barriers for environmental technologies such that they can achieve their full potential, ensure that the EU takes a leading role in developing and applying environmental technologies and mobilise all stakeholders in supporting these objectives. It focuses on three pillars: getting from research to markets; creating the right market conditions; and acting globally, ensuring that the international dimension is suitably incorporated.

More precisely, the Environmental Technologies Action Plan contains 28 actions of which 11 are chosen as priority actions (PAs) for the Commission, national and regional governments, industry and other stakeholders to improve the development and uptake of environmental technologies. The PAs are to:

Getting from Research to Markets

  • Increase and better coordinate research (PA1),
  • Launch three technology platforms bringing together researchers, industry, financial institutions, decision-makers and other relevant stakeholders (PA2) (see Box 3.2),
  • Establish European networks of testing and standardising [7] (PA3),
  • Improving Market Conditions
  • Develop and agree performance targets for key products, processes and services (PA4),
  • Mobilise financial instruments to share investment risks (PA5),
  • Review state aid guidelines (PA6),
  • Review environmentally-harmful subsidies (PA7),
  • Encourage procurement of environmental technologies (PA8),
  • Raise business and consumer awareness (PA9),
  • Provide targeted training (PA10), and

Acting Globally

  • Promote responsible investments in and use of environmental technologies in developing and economies in transition countries (PA11) – eg through trade agreements; development of cooperation funds

There is also a plan for moving forward, which includes regulator reviews of the situation, the setting up of a European Panel on Environmental Technologies (EPET) and the use of the open method of coordination (OMC) – recall 2.1.1.and see also 2.2.3.

The Commission in the Plan concludes that important key players in making the plan come true are the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD). The Commission therefore calls on the Member States, the European Council and the European Parliament to request the EIB and the EBRD to broaden their range of financing instruments to promote environmental technologies.

According to the Plan, every two years, the Commission is to report on the implementation of the ETAP to the European Council and the European Parliament.

3.2.3 Implementing ETAP

The High Level Working Group

A new High Level Working Group, consisting of government officials from the 25 Member States and Norway, has been created to ensure the implementation of ETAP. The first meeting of the group took place on 3 May 2004 in Brussels.

According to the minutes [8] of the meeting, all delegates who expressed their views confirmed the high priority dedicated to ETAP by their countries, the need for the Action Plan to produce rapid results and to mobilise and closely involve relevant stakeholders in its implementation.

A number of actions were suggested by delegates as to be prioritised, among these were:

  • Green procurement,
  • Performance targets,
  • Dissemination of R&D results and more generally the need to share good examples of technologies,
  • Funding mechanisms,
  • Economic instruments including taxes, the review of state aids guidelines and of environmentally-harmful subsidies, the development of pilot projects in key technological domains,
  • The work on specific sectors such as energy-efficiency or water and resources management,
  • The enhancement of producers and consumers awareness on environmental technologies,
  • Technology platforms

It was mentioned in the meeting that a number of criteria used to retain a technology platform have been proposed by stakeholders, namely the perspective to elaborate a research agenda, the European added value and the appropriate technical and political conditions (for the latter, the link with research objectives).

In order to bring forward the preparation of the co-operation with Member States in implementing ETAP, the Commission asked Member States delegates to forward a short paper by the end of May, covering:

  • Actions under ETAP that should be priorities for the work of the group
  • Areas where Member States have examples of good practice
  • Actions that Member States would have a particular interest to contribute to and take an active role in the co-operation

Based on these contributions, the Commission will prepare and circulate a synthesis report, with proposals for the future work of the group, which will also serve as a preliminary basis for the report to the Spring Council 2005 on the implementation of ETAP.

The next meeting of the group on implementing ETAP is planned to take place on 29 October 2004.

The European Panel on Environmental Technologies (EPET)

The exact nature of and involvement in the EPET is still being decided – indeed discussions on 2 June 2004 at the Green Week, underlined this, where Catherine Day (Director General, DG Environment) called for debate on 'what should EPET be' and 'who should be on the panel' and 'what resources it should have'. The debate led to a range of suggestions, but to no obvious consensus on a way forward. It is clear that Member State representatives will remain key here, as they are in the high level working group, which is seen as a type of precursor or stepping stone to the EPET.

The working aim of this panel is to exchange information (eg best practices), advise the Commission, derive concrete initiatives. How much advising should be done and how much exchanging and the balance of the two is still to be decided. Similarly it is still unclear whether the panel should be 'wide or narrow'.

The problem was raised [9], that the subjects to be covered by the EPET would be too broad to have all knowledge grasped by the group, no matter how qualified. This argues either for a more flexible EPET, with the panel membership being flexible, with interchange of people, or a core panel supporting by working groups (of time-limited role), or linked to other research networks, whether existing national or EU ones, or new ones such as a European Panel on Sustainable Development (EPSD).

The suggestion was also made in Green Week that the EPET could also usefully be involved in the regular ETAP review when this is done every other year. For example it could be involved in the planning of the review and write parts of the review. Furthermore, the suggestion was made that the key focus for the EPET could be on:

  • Establishing technology platforms (PA2) – helping with the implementation phase;
  • Performance targets (PA4) – could help in developing this further
  • Business and consumer awareness.

As regards working methods, the proposal was made that the EPET be non-political (widely endorsed) and that it could give a second opinion on white and green papers where relating to ETAP issues, be a forum for top level discussions on global initiatives of long time frame.

The rules of the EPET are not clear yet. There is therefore potential to influence the design and ensure that the right people are nominated, whether from government, NGOs, industry or non-aligned high calibre people.

OMC

ETAP will be a test case for using the OMC in an environmental context, the Commission has announced and the council has supported that this possibility is explored. This is quiet a novelty of the plan, as the environmental policy field is normally characterised by the CM, however, one may argue that environmental technologies do indeed not fall exclusive within the remit of the environment policy field as it has (or ought to have) as much to do with enterprise, competitiveness and innovation policies. To what extent the OMC will take precedence over or supplement traditional Community Methods, however, will depend on discussions with Member States.

The need to clarify the limits of the Open Method of Co-ordination and/or the role of the High Level Working Group in the implementation of ETAP was also stressed in the High Level Working Group in May.

As mentioned the OMC is already being applied to the other two 'legs' of the EU Sustainable Development Strategy – but these are areas where (unlike in environment) Community competence is limited.

In applying the Open Method of Co-ordination in implementing ETAP, the Commission favours a gradual and flexible approach, focussing on a limited number of areas and on exchange of experience and best practice. The Commission wishes to avoid discussions on theory/structures and start with the substance and then based on that see how common work evolves.

From an environmental perspective, the concern is that there could be an increasing temptation to apply the OMC instead of environmental legislation. In other words, one might see a gradual softening of EU environmental policy unless strict criteria for when the OMC can be used are established.

3.3 Enlargement

One of the key elements of cohesion policies is to make the new Member States make the 'right' investments – this involves reaching EU minimum standards in some areas, reaching the standards of best available techniques (BAT) in others, and going beyond requirements in yet others, such as by ' leapfrogging' current Member States and going for the very best technologies and techniques. Ideally, the approach would be one of ensuring that investments allow countries to move to the front line of technologies or techniques, but in practice this may tend to be optimistic given the huge scale of the task of harmonising standards facing these countries.

Key areas of development as regards environmental technologies are:

  • Eco-industries – we have seen and can expect to see continued very significant investments in eco-industries [10] – technologies and services to address:
    • Pollution management: air pollution, water, waste
    • Clean technologies – process/products: same environmental domains as pollution management; and
    • Resource management – water, renewable energies, recycling etc
  • Process and product innovation that are not environmental per se, but lead to environmental benefits given process or product efficiency gains.

Investments in the tens of billions of Euros has already taken place, and additional sums nearer 100 billion Euros [11] can be expected to be spent in the new Member States and remaining candidate countries. While these countries have some of the technologies, these fast growing markets offer major opportunities for EU companies. For Denmark, sales of, inter alia, wind energy technologies, could prove a valuable market as we get to the Kyoto implementation periods.

It is clear that in the coming years the new Member States and remaining candidates (and soon to be Candidate countries) will be busy implementing the EU environmental acquis Communautaire, with its economic and administrative challenges [12]. This will lead to a number of environmental technologies being implemented – from clean technologies and processes related to the IPPC Directive to more 'traditional' end-of-pipe technologies for environmental services. Having said that, we can expect some fast growing modern industries, and particular scope for new clean technologies where the old capital stock is to be replaced in a short period. In some cases, there may actually be more room for innovation in the old member states where in certain areas there is a greater case of technology lock-in. Overall the focus will remain on traditional eco-industries, but a move towards clean processes will be significant. Much of the expenditure will remain in the countries themselves, especially where relating to labour intense expenditures (eg relating to waste), but where investments relate to capital goods (complex filters, chemicals, instrumentation, renewable energies), then products from old Member States may well be sought. In some areas, we can expect the new Member States to catch up quickly, notably with joint ventures with companies from old Member States or further a field.

At this stage it is unclear what the New Member State influence will be on ETAP. Having said this, there is some fresh enthusiasm and critical spirit in the new Member States and one can expect at least some constructive ideas for debate, and real encouragement that certain of the PAs become real actions and be involved in the technology platforms.

Footnotes

[1] Communication from the Commission to the Council and the European Parliament, 2003 Environment Policy Review - Consolidation the environmental pillar of sustainable development, COM (2003) 745, 03.12.2003

[2] Communication from the Commission, More research for Europe - Towards 3 % of GDP, COM(2002)499, 11.09.2002 – the Communication is complemented by the SEC(2002)929

[3] Communication from the Commission, Investing in research: an action plan for Europe, COM(2003)226, 30.04.2003 – the action plan is complemented by the SEC(2003)489

[4] Report from the Commission, Environmental Technology for Sustainable Development, COM (2002)122, 13.03.2002

[5] Communication from the Commission, Developing an action plan for environmental technology, COM (2003)131, 25.03.2003

[6] Communication from the Commission to the Council and the European Parliament Stimulating Technologies for Sustainable Development: An Environmental Technologies Action Plan for the European Union - COM(2004)38, 20.01.2004

[7] Note that Canada and the USA already have environmental technology verification centres, which are linked with international markets, such as China and Indonesia. Any EU move to having testing networks could usefully have an international component to ensure the connection to global markets. Note that the certificates produced should help in procurement, technology recognition, reducing concern as regards technological risk, and may help link to funds (Eg structural funds).

[8] These are seen by some as 'informal' as the minutes do not have a formal status.

[9] Dan Stromberg of Chalmers University, during the Green Week session on ETAP

[10] ECOTEC (2002) Analysis of the EU Eco-Industries, their Employment and Export Potential.

[11] CEC (2001): Communication from the Commission - The Challenge of Environmental Financing in the Candidate Countries

[12] Ecotec, IEEP et al (2002) Administrative Capacity for Implementation and Enforcement of EU Environmental Policy in the 13 Candidate Countries.

 

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Version 1.0 November 2004, © Danish Environmental Protection Agency