11

European Commission

European European sustainability policy: sustainability policy:

key elements and key elements and driversdrivers

EBC Annual CongressEBC Annual CongressEdinbourgh, 20 October 2006Edinbourgh, 20 October 2006

Andrea VettoriAndrea VettoriDirectorate General Environment Directorate General Environment

European CommissionEuropean Commission

22

European Commission

ENVIRONMENT AND THE SINGLE MARKETENVIRONMENT AND THE SINGLE MARKET

Environmental legislation at the European level is a key element in ensuring a Environmental legislation at the European level is a key element in ensuring a level-playing fieldlevel-playing field and fair competition across the Single Market and fair competition across the Single Market.

If we do not have common standards then we run the risk of “Eco-Protection” where national rules act as barriers to trade. That’s why also environmental policy is largely based on internal market principles and on the harmonisation of national standards for the free movements of goods.

But the impact of environmental standards agreed in Europe extends much wider, with EU standards often adopted by competitors and becoming the de facto world market standard.

33

European Commission

In environmental protection the economic benefits are typically generalised – for example an overall improvement in public health – and usually accrue in the medium to long term, whilst the costs are normally focussed – often on a particular industrial sector or a particular geographic region – and are immediately felt.

The costs of environmental protection are going down. The amount spent by industry to meet environmental standards has fallen by 25 per cent since 1999.

There is no evidence that environmental policy has a significant impact on international competitiveness. Statistics show that the EU, US and Japan all spend around 2% of GDP on environmental protection.

ENVIRONMENTAL POLICY COSTS AND EU ENVIRONMENTAL POLICY COSTS AND EU INDUSTRYINDUSTRY

44

European Commission

“the need to improve environmental performance will trigger innovation that can offset the costs of compliance” (M.Porter)

reducing pollution usually coincides with more efficient industrial processes and a better use of resources

“companies that improved their environmental performance experienced a greater net probability of earning positive profits of between 3 and 34%” (OECD)

ENVIRONMENTAL STANDARDS FOSTER ENVIRONMENTAL STANDARDS FOSTER INNOVATION AND CLEAN PRODUCTIONINNOVATION AND CLEAN PRODUCTION

55

European Commission

THE COST OF NON-ENVIRONMENTTHE COST OF NON-ENVIRONMENT

Transport: the environmental impacts of transport and congestion are estimated to have a cost equivalent to up to 5% of GDP .

Health impacts: The health costs of air pollution in Europe are estimated at between €50 and100bn a year. This includes the social costs of 350.000 premature deaths and the loss of 150 million working days a year .

In 2004, climate change related disasters caused economic losses of more than €86 billion globally, almost twice as much as in 2003.

Climate change: Munich Re has estimated that the cost of damages due to climate change may double over the next few years to reach 150 Billion dollars in 2010.

Marine environment: the cost of the Erika sinking in 1999 was more than €800 million, half of which was borne by the tourist industry. The estimated cost of the Prestige disaster to fishing and tourism was estimated to reach €5 billion.

66

European Commission

NEW HIGH GROWTH SECTOR OF ENVIRONMENTAL NEW HIGH GROWTH SECTOR OF ENVIRONMENTAL TECHNOLOGIESTECHNOLOGIES

The EU's eco-industry turnover is around is around The EU's eco-industry turnover is around is around 227 billion Euro227 billion Euro a a yearyear, of which 30% is capital investment. Overall, the eco-industry , of which 30% is capital investment. Overall, the eco-industry accounts for 2.2% of European GDPaccounts for 2.2% of European GDP

Over 3 million people are directly employed in Europe’s eco-industries - similar to the aerospace or pharmaceuticals industries .

The EU eco-industry has also about 1/3 of its’ global market and had a trade surplus last year of over €600 million. In 2004 exports grew by around 8 %.

In January 2004, the European Commission launched an Environmental Technology Action Plan to overcome barriers to the development and use of environmental technologies, with 25 actions to get from research to market and to improve market conditions

The Action Plan should be supported by considerable Community funding: in the new Framework Research Programme the Commission has proposed funding for environmental research amounting to over 2 billion euros; direct financial support through the new Competitiveness and Innovation Programme where €430 million has been earmarked for eco-innovation.

77

European Commission

THE NEXT GENERATION OF ENVIRONMENTAL POLICYTHE NEXT GENERATION OF ENVIRONMENTAL POLICY

The Sixth Environmental Action Programme (6EAP), which was adopted by the European Parliament and Council in 2002 and runs until 2012, requires the Commission to prepare Thematic Strategies covering seven areas:

Air Pollution (adopted 21/09/2005)

Protection and Conservation of the Marine Environment (adopted 24/10/2005)

Prevention and Recycling of Waste (adopted 21/12/2005)

Sustainable Use of Resources (adopted 21/12/2005)

Urban Environment (adopted 11/01/2006)

Soil (adopted 22/09/2006)

Sustainable Use of Pesticides (adopted 12/07/2006)

88

European Commission

The Thematic Strategies represent the next generation of environment policy, taking a medium-term perspective to around 2020.

They work with themes, rather than with specific pollutants or economic activities as has been the case in the past. The strategies set clear environmental objectives, for instance in terms of air quality, and, on this basis, seek to identify the most appropriate instruments to achieve these objectives.

Each strategy is founded on thorough research and science, and follows an in-depth review of existing policy and wide-ranging stakeholder consultation.

Each Thematic Strategy will thus help achieve the long-term goal of environmental sustainability while contributing to the Lisbon goals of enhancing growth and employment and promoting eco-innovation.

The strategies are also an exercise in Better Regulation, simplifying and clarifying legislation where it already exists and proposing light framework legislation where new laws are deemed necessary.

THE THEMATIC STRATEGIESTHE THEMATIC STRATEGIES

99

European Commission

A COMPLIANCE ASSISTANCE PROGRAMME A COMPLIANCE ASSISTANCE PROGRAMME FOR SMEFOR SME

Informal meeting of EU Environment Ministers in Amsterdam in April 1997: “Environmental requirements should be related to the nature and magnitude of environmental pollution and not to the size of the enterprise.”

6th Environment Action Programme: “Compliance Assistance Programme for SMEs”

Article 174 of the Treaty: the “polluter pays” principle

Shared responsibility: EU, Member States, regional and local authorities, business organisations and business support networks

1010

European Commission

SMEs & THE ENVIRONMENTSMEs & THE ENVIRONMENT

There are some There are some 23 million SMEs23 million SMEs in the EU-25 in the EU-25 which represent 99% of all enterprises (57% of value which represent 99% of all enterprises (57% of value added)added)

SMEs are responsible for SMEs are responsible for 60-70% of all industrial 60-70% of all industrial pollutionpollution in the EU in the EU

93 %93 % of UK SMEs interviewed think that they don’t of UK SMEs interviewed think that they don’t undertake activities that could cause harm to the undertake activities that could cause harm to the environment (environment (UK Environment AgencyUK Environment Agency) )

75 %75 % of UK SMEs don’t have any environmental of UK SMEs don’t have any environmental policy and only policy and only 6%6% have an EMS in place ( have an EMS in place (UK UK Environment AgencyEnvironment Agency) )

1111

European Commission

Problems to addressProblems to address::

lack of awareness and knowledge of lack of awareness and knowledge of environmental problems and risks environmental problems and risks

lack of awareness of potential lack of awareness of potential benefits of environmental benefits of environmental managementmanagement

lack of financial and human lack of financial and human resources resources

lack of access to information, tools lack of access to information, tools and training and training

general lack of long-term planning at general lack of long-term planning at the company level the company level

ENVIRONMENTAL COMPLIANCE ASSISTANCE PROGRAMME FOR SMEs

1212

European Commission

ENVIRONMENTAL COMPLIANCE ASSISTANCE PROGRAMME FOR SMEs

ObjectivesObjectives::

Increase Increase compliancecompliance with environmental with environmental legislationlegislation

Reduce Reduce environmentalenvironmental impactimpact/improve /improve environmental performanceenvironmental performance

Increase Increase eco-efficiencyeco-efficiency (energy, (energy, resources)resources)

Increase cost-effectiveness of env. policy, Increase cost-effectiveness of env. policy, focus on focus on implementationimplementation

Increase Increase eco-innovationeco-innovation and and competitiveness in SMEscompetitiveness in SMEs

1313

European Commission

Communication/information for Communication/information for awareness raisingawareness raising

A single portal for DG ENV A single portal for DG ENV website on SME & website on SME & environmentenvironment, in at least 7 languages , in at least 7 languages

The Network of The Network of Euro Info CentresEuro Info Centres will be the will be the principal partner in the implementation of the principal partner in the implementation of the Programme in 2007 and will ensure in every region Programme in 2007 and will ensure in every region environmental expertise.environmental expertise.

Local environmental experts for SMEsLocal environmental experts for SMEsTrain-the-trainer seminars in all MS to start building a Train-the-trainer seminars in all MS to start building a network of environmental expertsnetwork of environmental experts in business in business support organisationssupport organisations

MAIN INITIATIVESMAIN INITIATIVES

1414

European Commission

Dissemination of best practicesDissemination of best practices

Selection & assessment of transferabilitySelection & assessment of transferability of best of best practices for MS practices for MS

Yearly Yearly MS expert forum meetingMS expert forum meeting

Improve use of existing EU policies and Improve use of existing EU policies and voluntary instrumentsvoluntary instruments

Support through Support through LIFE+LIFE+ the development of specific the development of specific tools to assist SMEs in implementing environmental tools to assist SMEs in implementing environmental policies policies

Promotion and support of innovative public-private Promotion and support of innovative public-private partnerships to promote partnerships to promote EMAS in SMEsEMAS in SMEs ( (e.g. e.g. clusters or supply chains approachesclusters or supply chains approaches))

MAIN INITIATIVES (2)MAIN INITIATIVES (2)

1515

European Commission

Competitiveness and Innovation Competitiveness and Innovation Programme (CIP)Programme (CIP)

LIFE+LIFE+

Structural FundsStructural Funds

7th Framework Programme for 7th Framework Programme for ResearchResearch

FUNDING 2007-2013FUNDING 2007-2013

1616

European Commission

FOR MORE INFORMATIONFOR MORE INFORMATION

SMEs & environmental policy: http://ec.europa.eu/environment/sme

The EU Eco-label: http://ec.europa.eu/environment/ecolabel

EMAS (EU Environmental Management and Audit Scheme): http://ec.europa.eu/environment/emas

Green Public Procurement: http://ec.europa.eu/environment/gpp/

Mainstreaming CSR among SMEs: http://ec.europa.eu/enterprise/csr/ms_sme_index.htm

Environmental Technologies Action Plan(ETAP): http://ec.europa.eu/environment/etap

Competitiveness and Innovation framework Programme (2007-2013): http://ec.europa.eu/enterprise/enterprise_policy/cip/index_en.htm

Thank you for your attention!Thank you for your attention!