Working Report, 23/2006 – Strengthening Environmental Integration in the EU

Strengthening Environmental Integration in the EU

Summary and Recommendations

The EU Sustainable Development Strategy, the Cardiff Process and Integrated Product Policy

Integrated Product Policy (IPP) is recognised as having a key role in contributing to sustainable development. At a strategic level it is to be an integral part of the EU Sustainable Development Strategy and one of the main delivery mechanisms for objectives set out in the 6^th Environmental Action Programme, in particular the Thematic Strategies on Natural Resource Use and Waste Recycling.

The Commission has encouraged individual sectors to be more explicit in how they intend to integrate the IPP approach into their work, and Member States to ensure the integration of IPP thinking into non-environment policy areas. However, this report indicates that there is a need to explore in more detail precisely which policies and sectors are most suitable for advancing the IPP concept. There is substantial scope for future EU enterprise policies, economic policies and regional policies (structural funds) to address IPP thinking, but it is less evident that the concept can be successfully taken up in some other areas.

The Environment Council during the Dutch Presidency in the second half of 2004 is likely to prepare conclusions on the Commission’s Communication on the Stocktaking of the Cardiff process. This and the review of the EU SDS later in 2004 are opportunities for pressing for advancing environmental integration in general and in specific areas.

Recommendations:

The Annual Environment Policy Review and the Cardiff Stocktaking should be used as a basis to reinforce the environmental dimension of the EU SDS. Accordingly, the Commission should produce the Annual Environment Policy Review and the Cardiff Stocktaking in time for the documents to contribute to the Spring Report and the Spring Summits.

The use of Open Method of Co-ordination (OMC)

The environment dimension has been sidelined in the EU SDS and has been given limited attention in the Spring Reports and at the Spring Summits. It has been argued that the use of OMC in the environmental policy field can help redress the situation. It is however, unclear how this would work without a supportive Environmental Policy Committee – like those for economic and social policies. It is also questionable whether applying OMC to environment policy will undermine the Community method, which is the basis for the Community’s acquis on the environment.

Recommendations:

OMC should only be used in areas where it is a supplement to EU environmental regulation – e.g. in relation to investments in and research on cleaner technology and the exchange of good practices.
OMC should only be used when progress at EU level is limited due to unanimity voting rules – e.g. in relation to economic instruments for the environment.
OMC used in relation to environmental policies should ensure the European Parliament’s involvement in the process.

Broad Economic Policy Guidelines and Economic Instruments

Many products do not include the costs of the environmental impacts that they create. Aircraft fuel and aviation services are clearly some of these products. In accordance with the IPP principle of working with the market, it would make sense to introduce economic instruments to help to tackle the emission and noise impacts of aviation. The BEPGs could be one way to further the general use of economic instruments for the environment via the OMC.

Recommendations:

The review of the EU SDS should explore the opportunity for furthering the use of economic instruments for the environment via the BEPGs, and the Environment Council should ensure that it contributes to the drafting of the BEPGs, and to this end, Environment Ministries should ensure that their voices are heard in the annual cycle of economic policy discussions.
In relation to the rapid growth of aviation, Member States should use the flexibility of the new Energy Products Directive to introduce market based instruments at national level and when renegotiating their bilateral aviation agreements with third countries ensure that market based instruments can be applied to aviation. The Commission should come forward with proposals for measures to tackle the issue at EU level, as soon as possible.
Recommend that inter ministerial working groups or ‘integration’ networks are formed in the Member States to ensure a coordinated and constructive cooperation between financial, transport and environment responsible to take forward measure to address the growth in aviation.

Funding for the Environment

The most important potential sources of EU funding for environmental projects generally, and IPP-related initiatives specifically are the Structural Funds. There are many examples of projects financed by the Structural Funds, which have directly or indirectly supported approaches to cleaner production - but more needs to be done. Other funding opportunities arise through the LIFE programme, and through the EU’s RTD programmes as well as the new programme for competitiveness of enterprises. The need for a new Financial Perspective for 2007-2013 means that all these funding sources are currently being renegotiated, and in the coming months opportunities for influencing the new Regulations to take greater account of IPP should be seized.

Recommendations:

The Commission’s commitment to reinforce the use of the Structural Funds to support overarching EU policy strategies such as the Lisbon Process and the EU SDS should be built upon in order to secure greater recognition of the importance of financial support for environmental initiatives, especially regarding IPP and the Environmental Technology Action Plan (ETAP).
More specifically, IPP and other environmental priorities should be reflected in guidelines in the forthcoming EU Strategy on Cohesion Policy, and in National Cohesion Strategies.
Authorities wishing to advance IPP should draw up their own Financing Strategies, indicating which of the Community’s financial instruments would be most appropriate for proposed measures. Further advice on this will be required when new Regulations on the various financing instruments have been agreed.
More use should be made of INTERREG-type initiatives on transnational co-operation to establish and support networks for the exchange of good IPP practice.

Impact Assessment as a generic tool for integration

In 2002 the European Commission introduced a new system of integrated impact assessment (IA) for its major proposals. This was intended to weigh up all likely economic, social and environmental impacts of a proposed measure; to identify synergies and clarify any necessary trade-offs between them; and to consider alternative policy options and instruments. However, the quality of the first wave of IAs has been uneven, and some of them poor. In particular, environmental impacts have received limited attention, and most emphasis has been placed on the short-term economic costs of proposals, particularly in relation to industrial competitiveness. Without major strengthening, the Commission’s IA system as it stands cannot be relied upon to advance environmental integration.

Recommendations:

A major culture change is required among Commission directorates-general to support an effective impact assessment system. This requires demonstrable political commitment at the highest level within the Commission and Council.
This high-level support should be reflected at a practical level in the provision of adequate resources for the provision of training, advice and quality control.
The Commission’s Guidelines on Impact Assessment should be revised to give clearer guidance on incorporating environmental and sustainable development issues in impact assessments.
In association with relevant EU agencies, the Commission should devote greater effort to establishing a permanent infrastructure for the continuous collection and analysis of basic data required for impact assessment. Particular emphasis should be given to environmental and social data.