Eco-innovation opportunities in nine sectors of the EU economy

10 May, 2012

The European Commission has recently published the study "Eco-innovation opportunities in nine sectors of the EU economy" performed by TNO under the Europe Innova (an initiative of DG ENTR).


The study presents an overview of eco-innovation opportunities, explains the impact of regulation on eco-innovation and provides an analysis of the potential and new markets for environmental innovations in Europe. It focuses on nine the most important sectors: biotechnology, automotive, electrical and optical equipment, aeronautics and space, construction, knowledge intensive business services, wholesale and retail trade, textile and clothing, and food and drinks.


Key findings:


- Eco-innovation is a horizontal issue that cuts across all sectors, thus, eco-innovation opportunities and potential exist in all stages of the value chain in all the sectors of interest of SIW-II.


- The strongest global players in eco-innovation are the US and Europe, where Europe follows the US by a relative small margin.


- The fastest growing eco-innovation market is underpinned to energy efficiency, storage and infrastructure. The largest venture capital flows have been accrued also in this type of technologies. It is likely that global markets on energy generation and management have already well defined players.


- Relative to energy technologies other eco-innovation thematic clusters are neglected. The role of policy here is to raise awareness of the large number of eco-innovation opportunities and create the necessary incentives for current markets up scaling.


- The top-five sectors that report the largest potential for eco-innovation are biotechnology, construction, knowledge intensive business services, automotive, and electrical and optical equipment.


- Strategic eco-innovators included in scope of this study in average expect their market to double current size over the next five to seven years.


- The association between regulation and eco-innovation is strong and positive. Thus, those firms under stringent regulation engaged more frequently in eco-innovation.


- Regulation and eco-innovation across sectors. The aerospace and construction sectors show a relative larger number of regulations that resulted significantly related with environmental regulations. In the middle we found the textiles and clothing, wholesale and retail, automotive. The lower end corresponded to electrical and optical equipment, KIS, biotechnology and food and drinks. It must be noted that for all sectors - with the exception of the aerospace and construction sectors – the association of environmentally motivated regulations with innovation was weaker than other regulations affecting the behaviour of business.