Sustainable Consumption and Production

pannier-eco-label.jpg

This article is part of our special report Products for a greener planet.

Amid concerns that growing resource scarcity and rising raw material costs are dampening prospects for Europe's economic growth, the EU is looking for ways to decrease the environmental impact of industrial activity, product manufacturing and consumption patterns.

The mainstay of current EU efforts to reduce the environmental impact of consumer goods is the 2005 Eco-design requirements for energy-using products (EuP) Directive, which sets requirements on energy use for popular products that consume energy, such as hairdryers, computers, fridges or office equipment (EURACTIV LinksDossier).    

In addition, a range of existing instruments and policy areas address the broader issue of sustainable consumption and production, including 'thematic strategies' on use of natural resources and waste as well as the Integrated Product Policy (IPP). Environmental groups have criticised this policy framework for being too fragmented and lacking sufficiently stringent regulations.

The Commission on 16 July 2008 proposed a combination of voluntary and binding measures designed to mitigate the energy use and environmental impact of products. 

Under the draft plans, products like windows and shower heads are to fall under the scope of existing rules for energy-using items as set out by the EuP Directive. They will be banned from the EU market if they do not meet certain standards related to energy consumption. 

The Commission on 16 July 2008 proposed a combination of voluntary and binding measures designed to mitigate the energy use and environmental impact of products. 

Under the draft plans, products like windows and shower heads are to fall under the scope of existing rules for energy-using items as set out by the EuP Directive. They will be banned from the EU market if they do not meet certain standards related to energy consumption. 

This represents a step-down from earlier plans in which the Commission was contemplating expanding the scheme to a wider range of consumer goods, like footwear and furniture (EURACTIV 28/04/08).

In an apparent effort to strike a balance between regulatory and market-based instruments, industry is being urged to develop benchmarks and voluntary standards for the various products that would be affected by the plans. The Commission said it would step in and regulate specific standards in cases where industry initiatives are deemed insufficient. 

The package of measures, contained in 'action plans' on Sustainable Consumption and Production (SCP) and on a Sustainable Industrial Policy (SIP), includes:

  • A proposal to revise and expand the scope of the EuP Directive to all energy-related products;
  • A widened scope for the use of labels that detail the energy use or impact of products;
  • New public procurement rules to favour the uptake of 'green' products;
  • A revision and expansion of the EU's Ecolabel or flower scheme to include, among others, food and drink products, and;
  • A revision of the voluntary eco-management and audit scheme.

Incentive measures

Along with new labels and standards, the SCP/SIP plans include recommendations for fiscal incentives and 'greener' public procurement rules in order to stimulate demand and uptake of cleaner products, with a proposal for a new directive on green procurement forecast for September. 

The incentive measures will be based on voluntary benchmarks that will "identify the best environmental performance" of a given product or product range, according to the plans. 

More investment in research and the creation of 'lead markets' to stimulate growth in certain sectors deemed highly sustainable are also being put forward. The Commission published a communication on lead market initiatives in January 2008 (EURACTIV LinksDossier).

Well received?

The Commission has received "generally positive" feedback from stakeholders about the action plans, according to one EU official close to the dossier. Brussels has also welcomed clean product initiatives by large retailers, the official said in reference to a 10 March initiative by the European Retail Round Table (ERRT). 

But there are concerns in Brussels circles that the action plans will spark a contentious debate between industry sectors about the scope the standards. Moreover, a repeated delay of the action plans, originally scheduled for December 2007, has given rise to speculation that the Commission struggled to define a coherent strategy (EURACTIV 21/02/08). 

Please see the positions below as well as our related coverage for more stakeholder positions and reactions.

EU Industry Commissioner Günter Verheugen believes the SCP and SIP plans are part the "birth of a new chapter" in the EU's industrial policy. This is necessary to "overcome old thinking" with respect to the perceived contradiction between modern technologies and environmental protection, Verheugen said in Brussels on 27 June.

Meanwhile, EU Environment Commissioner Stavros Dimas is confident that "we are only at the beginning of a move towards sustainable consumption and production. But these are important first steps and in 10 years time I am convinced that environmental product standards will be taken for granted by European consumers. And with a single market of half a billion people, where Europe leads, the rest of the world very often follows," he said in a 3 June statement.

But not all experts are certain consumers will 'get it'. EU consumer organisation BEUC says the onus should be on simplicity as eco-labels containing too much information will confuse consumers. Jim Murray, the organisation's former director, argues that designing a workable SCP strategy will require "a more realistic understanding of consumers as they actually are, and not as we would wish they were".

The Organisation for Economic Cooperation and Development (OECD) also cautions in a 2008 study on sustainable consumption that "in general, subsidies and tax incentives only work if they close the price gap for more sustainable products or create significant tax rebates for their use". 

"Incremental tax reductions or small subsidies" meanwhile "do not by themselves create demand for more sustainable products," the study says.

Tax incentives are commonly used to stimulate the development of goods such as energy-efficient appliances, cleaner cars or renewable energies. But coordinating national tax policies at European level is difficult. A joint proposal put forward in November 2007 by the UK and France in favour of reduced (and harmonised) VAT rates for green goods and services, for example, did not receive broad support from other member states, which must agree on such measures unanimously (EURACTIV 13/11/07). 

Orgalime, which represents the EU's electronics and electrical engineering industries, says the industry can make big contributions to cutting EU CO2 emissions, especially through energy efficiency improvements. But more investment incentives and greater certainty on exemptions to EU emissions rules are needed, the organisation said in a 25 June press statement (EURACTIV 27/06/08). 

Subscribe to our newsletters

Subscribe

Want to know what's going on in the EU Capitals daily? Subscribe now to our new 9am newsletter.