Perspectives for business, Europe and the environment

Copenhagen, 19 April 2005

Perspectives for business, Europe and the environment

Professor Jacqueline McGlade
Executive Director, European Environment Agency

Speech to Conference on Eco-innovation: Potentials and challenges of tomorrow's technologies
European Environment Agency, Copenhagen, 19 April 2005

Welcome
It is with great pleasure that I welcome you to the Eco-innovation conference, an event building on the innovative work of the Danish Technical University, Riso and the Danish Environmental Protection Agency, and sponsored today by the Danish Ministry for the Environment and the European Environment Agency.

The meeting has been designed to help all of us share our knowledge on the potentials and challenges of tomorrow's technologies and the perspectives for businesses and industries involved in the development and application of new technologies, Europe's role in the global market, and the environment.

Innovation
Innovation is essential for economic growth and social development. Eco-innovation, in particular, addresses the need to improve environmental quality. It is not only new technology products but also R&D services - applying established knowledge and making smart foresight and uncertainty assessments of novel technologies.

This conference is a first attempt to showcase the meaning, relevance, and purpose of eco-innovation: especially the "Eco" part of the term by featuring a variety of presentations on experiences and perspectives from industry, government institutions and academia.

Policy
Within the "Lisbon process" a new era of environmental policy linked to innovative approaches to creating synergies between economic development and environmental performance has begun - one where environmental legislation is seen as only one of several instruments to be used for handling increasingly complex sets of challenges.

Problems such as global climate change, non-point source pollution from roads and cultivated lands, and loss of habitat and biodiversity, require a much broader set of tools than we have relied upon in the past.

Instead we need to use knowledge based innovations that can not only elicit the environmental efficiencies we need to reach the economic and environmental goals of the EU but also to avoid the risks associated with our growing over-reliance on a reduced set of resources.

Today the challenge for business and research and for all policy-makers, is to get public acceptance of new technologies - balancing innovative possibilities and uncertainties.

Remit
But before I go further, what exactly do we mean by eco-innovation? In our own work, the EEA has considered eco-innovation as the commercial application of knowledge in order to increase environmental performance. Obviously, the scope of this conference is not to come up with definitions but taking this as a working description will provide a basis to help us to know more precisely how we can support the expansion of eco-innovation and the collateral components necessary for its development.

Potential
President Barosso has communicated his intentions on eco-innovation to the European Parliament highlighting the Commission's promotion of environmental technologies and structural changes necessary for long term sustainability. These are needed for use within the EU and to meet demand in expanding markets worldwide.

There is a significant potential for economic, environmental and employment synergies from environment technologies. Europe lags behind the US in providing the global market with environmental technologies¹ and needs a more favourable regulatory and financial framework to allow Europe's enterprises to compete more effectively.

The global market for environmental technologies and services is about € 400 billion. Recently, Japan has set the target of winning 50% of this market (² and ³). This market alone is forecast to expand at a rate of about 3% annually⁴. There are therefore market opportunities for innovative environmental technology - both high technology and soft technology, as well as end-of-pipe technology and process-integrated technologies. But innovation does not only exist in product development but also in its implementation and embedding within other knowledge areas.

Success stories - or failures?
Technology cannot solve all environmental problems, but there are many success stories in environment technology: catalytic converters in cars improving the air pollution situation in urban areas, sewage plants reducing the nutrient load to water, energy efficient solar cells and wind mills and future fuel cell technology.

However, in "solving" one problem we have often moved the problem to another region or group in society, or to another environmental media. For example, while the ecological relevance is unknown, metals, such as platinum used in car catalytic converters and in fuel cell technology, are now found in increasing concentrations in Arctic snow and ice. Sewage sludge and bio-waste are increasing problems, not least because of the increasing concentrations of pharmaceuticals and personal care products in water recipients in Europe.

Many of the technology failures are caused by a narrow framing in the scope or time of potential environmental impacts. It is necessary to introduce a new element in connection with technology development - an environmental technology assessment or perhaps a wider sustainability technology assessment.

Risk
In a knowledge based society, scientific knowledge must not be used only for technology development. Public acceptance of new technologies requires risk management/assessment - or a dynamic uncertainty management process - with a broad framing and public participation, not only assessment of ecological and health hazards but also social and economic impacts - something between the negative restricted risk management paradigm and the positive technology assessment. Otherwise, lack of public acceptance will be the biggest obstacle to introducing environmental technologies, or new technologies in general.
Today there is a global mega-trend of novel promising technologies combining the advances in information communication technology (ICT), biotechnology, nano-technology and materials technology which will provide solutions to some existing problems as well as new challenges.
Balancing innovative possibilities and potential risks is essential for sustainability. For example, the advantages of ICT - resource efficiency, de-materialisation and easy sharing of knowledge and best practices - can be counteracted by negative rebound effects - more transport and energy - and problematic materials and waste. For all technologies we need to weigh up the innovative possibilities and risks.

Technology contribution to renewable energies
One critical area of interest relates to the climate of our planet. Climate change is changing the European landscape, influencing the conditions for sun, wind, water and energy, forests and crops. In this situation, a crucial question is how Europe should plan for the future using a mixture of energy sources, particularly renewables, given the projected changes. A key question is whether the combination of subsidies and other instruments which exist today actually support environmental benefits and the application of new technologies to deliver such benefits - cross-subsidies can easily cause perverse effects. The three main novel technologies - biotechnology, nanotechnology and ICT - can provide an underpinning for Europe's future renewable energy demand, but only if subsidies and market based instruments are carefully designed.
To help visualise these interactions, the EEA is producing European level scenarios based integrated assessments, to enable the future balance of key resources to be determined. These then will enable us to see how realistic existing national plans are for renewable energy supply and demonstrate how the changed renewable energy potential of new technologies in a changing environmental landscape.

Other EEA contributions to ETAP
Besides supporting this conference facilitating eco-innovation and the potentials and challenges of tomorrow's technologies, the EEA intends to follow up by

• making a wide variety of assessments which link eco-innovation, new and environmental technologies to environmental impacts and policies;
• supplementing the European Innovation Scoreboard with Eco-innovation indicators;
• and making all this information - on new technologies and on their environmental impacts and benefits - available and more accessible through the environment technologies portal.

This is a small but, we hope, significant contribution to harnessing the environmental benefits of the new global technology challenge.
We need a new paradigm to substitute the present negative risk management approach - a dynamic process balancing uncertainties of novel technologies assessing risks and possibilities in a broader scope and time frame. This requires first and foremost better communication and information sharing between the research and development community, businesses and government institutions.
This conference is a stepping stone in that direction. But we should look more carefully at how better we can combine ideas and creativity with the rigour of forecasting and planning. The tools and approaches to make our joint efforts more effective are with us today. It might be, perhaps, just a matter of simplifying the steps in the innovation chain, setting clear directions, and acting together in order to achieve the success we are all aiming for.

¹Commission of the European communities, "Environmental technology for sustainable development", Brussels, 13.03.2002, COM(2002) 122 final.
²Environmental Industrial Commission (EIC), "Europe-wide Action Plan for Environmental Technologies.", Energy Information Centre, EIC News, London, UK, Spring 2004, pp 1,2. http://www.eic.co.uk.
³Centre For Environmental Research & Technology Transfer, "Market Opportunities", http://www.certt.co.uk/home.asp?level1_id=5&strSource=L1
⁴Centre For Environmental Research & Technology Transfer, "Market Opportunities", http://www.certt.co.uk/home.asp?level1_id=5&strSource=L1