Reducing the regional disparities

1. Contribution of the Regional Policyto eco-innovation and environmental technologies Pierre Godin, European Commission DG Regional PolicyAER-ARE / ECREIN Conference 1st June 2007, Stuttgart

2. EU Cohesion Policy (CP): objectives and context • Reducing the regional disparities • Contributing to the Lisbon strategy (2000), renewed in 2005 (integrated guidelines): • competitiveness and growth ) • more and better jobs ) …earmarking • Contributing to the Sustainable Development Strategy (Gothenburg 2001), renewed in 2006: • Climate change, clean energy, sust. transport • Sustainable production/consumption patterns • Sustainable management of natural resources

3. Eco-innovation? Environmental technologies? • Key words for defining eco-innovation (EI): • innovation = new: products, services, processes, management & business method • eco = to prevent or reduce the risk for the environment, pollution, other negative impacts, • Examples of environmental technologies (ET): • Clean and energy efficient in SMEs and others, • Water, waste water, waste, soil treatment, • Sustainable energy & transport (climate), • To prevent & cope natural & technological risks

4. EI&ET and the objectives of the regional policy • Eco-industries: 2.1% of GDP and 3.5 mio jobs • EI&ET, a decisive contribution to sust. develop: • challenge = synergies between 3 pillars of SD • integrat. economic, social & environmental obj. • Cohesion policy focuses on economic and social pillars: growth, competitiveness, jobs and social inclusion • Many priorities of the regional policy address the environmental pillar of SD: • EI&ET in SMEs and other businesses, • Water, waste water, waste, soil treatment, • Sustainable energy & transport / risk prevention

5. Turning challenges into opportunities EI&ET offers economic opportunities for CP by: • making regions more attractive places to invest and work • reducing production costs with clean & energy efficient technologies • improving competitive advantages of a region and its businesses • exporting regional eco-innovations To play synergies, it is necessary to reduce the administrative burden on the regions by simplifying the implementation of the environmental legislation.

6. EI&ET in the EU Strategic Guidelines on Cohesion (SGC) SGC focus on the following priorities: • improving the attractiveness of the regions by increasing accessibility & environmental potential • encouraging entrepreneurship, research and innovation capacities (including ICTs) • creating more and better jobs by attracting more people into employment, improving adaptability of workers & businesses, and increasing investment in human capital EI&ET are cross-cutting these 3 priorities.

7. EI&ET under the 1st priority of the SGC Strengthening synergies environment / growth: • investments to comply with environmental legislation: water, waste, air, nature • investments related to Kyoto commitments: sustainable energy and transport • risk prevention measures: management of natural resources, targeted research, better use of ICT, innovative public management policies • energy efficiency and low energy intensity development models; • renewable and alternative energies: wind, solar, biomass, Lisbon objective (20% in 2010).

8. EI&ET under the 2nd priority of the SGC Ensuring full exploitation of European strengths in the area of eco-innovations: • Eco-innovations should be promoted, together with the improvement of SME practices through the introduction of environmental management systems. • By investing in this area now, EU businesses will be in a strong position in the near future when other regions appreciate the necessity of such technologies. • This is an area with a clear link to the Competitiveness and Innovation Framework Programme.

9. EI&ET under the 3rd priority of the SGC The 3rd priority covers, in particular: • adapting education and training systems in response to new competence requirements, • enhancing capacity building in the public sector in the delivery of policies and programmes Although eco-innovation and environmental technologies are not explicitly mentioned under this priority, they should be taken into consideration.

10. Funding EI&ET under the European Regional Development Fund (ERDF) ERDF shall ensure SD (Art. 2), in particular: • Convergence (not earmarked): water supply, waste water & waste treatment, air quality • Convergence & competitiveness : • earmarked: cleaner and innovative technologies in SMEs, sustainable transport, sustainable energy (efficiency, renewable) • not earmarked: regeneration of contaminated sites, SD of Natura 2000 sites, sustainable tourism, risk prevention • Territorial cooperation: priorities under convergence & competitiveness objectives are priorities issues for cooperation

11. Funding EI&ET under the European Cohesion Fund (CF) CF is established for the purpose of strengthening the economic and social cohesion of the Community in the interest of promoting SD (Art.1) One of the two priorities is the environment, namely: • the priorities assigned to the EU environmental protection policy • The priorities related energy efficiency, renewable energy and sustainable transport

12. EI&ET within the implementing documents of the Member States (NSRFs and OPs) • Each Member State (MS) has to prepare a National Strategic Reference Framework (NSRF) and Operational Programmes (OPs) containing thematic and territorial priorities, basis for funding projects • NSRFs and OPs are prepared in partnership with environmental authorities and NGOs • The priorities chosen for an OP have to be justified taking account of the SGC, NSRF and the results of the ex-ante evaluation, incl. an environmental assessment • If the priorities of the OP are not sufficiently justified, the MS will be asked by the Commission to provide additional information and, if necessary, to revise the proposed OP. • In the negotiation process with the Member States, the Commission asks frequently to put more emphasis on innovation and eco-innovation.

13. EI&ET in the preparation and implementation of OPs / projects (SEA & EIA) Member States (MS) have to apply two Directives adopted under the EU environmental policy to provide a high level of protection of the environment and to contribute to the integration of environmental considerations: • At project level, the EIA Directive, • At programme level, the SEA Directive, Both SEA & EIA require a consultation (environmental authorities / public). Results have to be taken in consideration. Any decision that could damage the environment must be justified and accompanied by appropriate compensatory measures. EI&ET can reduce the pressure on environment of programmes and projects.

14. Balancing financial allocations between the different priorities of the Cohesion Policy (CP) Figures based on the proposed OPs (not yet adopted) and on the categorisation of Funds assistance: • Direct environmental investments (15%): water, waste, contaminated sites, air and climate change, nature protection and risk prevention • Indirect environmental investments (15%): sustainable transport and energy, promotion of eco-innovations and environmental management systems in SMEs, urban and rural regeneration, sustainable tourism • Necessary to find a balance between all this priorities Not easy to calculate allocations of CP to EI&ET: • Broad sense: 15 + 15 = 30% (of € 320 billions, EU total) • Narrow sense (code 06): assistance to SMEs for the promotion of clean & innovative technologies = 0.5%

15. Cohesion policy (CP) and other sources of funding Main differences with CIP (Competitiveness and Innovation Programme), FP (Framework Programme for Research (FP-RTD) and LIFE, are: • objectives: excellence in a sector (CIP, FP and LIFE) vs. regional integration (ERDF and CF) • level of desired impact: EU (CIP, FP and LIFE) vs. regional or national (ERDF and CF), • governance: centralised (CIP, FP and LIFE) vs. decentralised (ERDF and CF), • selection of projects: EU calls for proposals (CIP, FP and LIFE) vs. regional partnership under the OPs. Consequences on the probability for funding EI&ET: • CP: the region is sure to receive the money of the OP, • Others: based on results of the EU calls for proposals(?) Authorities responsible for CP, CIP & FP should develop synergies.

16. As a conclusion… • Under the Cohesion Policy, the EU has adopted strategic and operational instruments, to be implemented by the Member States, that should ensure that eco-innovation and environmental technologies are taken into consideration in the economic development of the regions. • Of course, it is necessary to ensure a satisfactory implementation, monitoring and evaluation of these instruments. Thank you for your attention!