WEI Malm, 04/11/2016 EU developments relevant to the sector Jeremy - - PowerPoint PPT Presentation

WEI Malmö, 04/11/2016 EU developments relevant to the sector

Jeremy Wall, Principal Administrator, Forest-based Industries, DG GROW/C-2 (Resource Efficinecy & Raw Materials)

DG Internal Market, Industry, Entrepreneurship and SMEs Directorate C: Industrial Transformation & Advanced Value Chains Unit C-2: Resource Efficiency & Raw Materials

GROW

Main sector-relevant EU developments

• 1. Juncker Plan (IPE): EFSI
• 2. The Circular Economy
• 3. Cumulative Cost Assessment study of the EU

Forest-based Industries

Juncker Plan (IPE): EFSI- general

The Investment Plan for Europe (IPE), was adopted in November 2014 as the first major initiative of the Juncker Commission. It seeks to reduce investment gaps in Europe. As part of the IPE, the European Fund for Strategic Investments (EFSI) aims to contribute to this goal by supporting investments and increasing access to finance for SMEs and mid-cap companies. EFSI’s dual objective is reflected in its two windows: the Infrastructure and Innovation Window (IIW), implemented by the European Investment Bank (EIB); and the SME Window (SMEW), implemented by the European Investment Fund (EIF).

Juncker Plan (IPE): EFSI- general

With EFSI support, the EIB Group will provide funding for economically viable projects where it adds value, including projects with a higher risk profile than

• rdinary EIB activities. It will focus on sectors of key

importance with the capacity to deliver a positive impact

• n the European economy, including:

i. Strategic infrastructure including digital, transport and energy; ii. Education, research, development and innovation; iii. Expansion of renewable energy and resource efficiency. iv. Support for smaller businesses and midcap firms.

EFSI results so far

By July 2016, under the Investment and Infrastructure Window, the EIB Board of Directors approved 97

• perations, for a total approved amount of EUR 13.6

billion in EFSI financing. Under the SME Window, 192

• perations have been approved. Those operations total

EUR 6.8 billion in EFSI financing. Total expected investment triggered amounts to EUR 115.7 bn i.e. 37% of the target.

• By 23 September 2016 the value of approved

financing has risen to EUR 22.3bn with expected mobilised investment of EUR 127.2bn i.e 40% of the target.

EFSI 2.0 - proposed amendments 1

• Following the stock taking communication of 1 June

2016, the Commission proposed amendments to the Regulation 2015/1017 (EFSI Regulation) on 14 September 2016.

• Main proposed amendments:
• •

Extending the operation of EFSI until the end of 2020 – financed mainly form the contribution from CEF and EIB. The expected target of the mobilised capital is EUR 500 bn

• •

Reinforcing the additionality requirements to make sure that EFSI supports projects that could not

• therwise be financed by EIB

EFSI 2.0 - proposed amendments 2

• •

Introducing a target for investments in transport and energy projects contributing to COP21 – EIB shall target that at least 40% on the EFSI financing under IIW supports projects with components contribution to the climate action,

• •

More proactive role for the European Investment Advisory Hub, particularly for investment platforms and projects in less developed regions.

• Furthermore, explicit references are included to

support industry and services in less developed regions and transition regions that would not be covered otherwise in the policy objectives of the EFSI Regulation.

• SME Window
• European Investment Fund (EIF) financing under

the EFSI for the four approved agreements with intermediary banks or funds amounts to EUR 96

• million. It is expected to trigger EUR 353 million

in investments and benefit 715 SMEs and start- ups.

• The European Investment Project Portal
• The European Investment Project Portal (EIPP) is a

new web portal enabling EU based project promoters – public or private – to reach potential investors worldwide.

• It is part of the Investment Plan for Europe initiative

to mobilise investment, promote economic growth and create more jobs across the EU. It responds to investors’ desire to see more potential EU investment

• pportunities in a central information platform.
• The EIPP is available from 1/6/2016. The portal

presents 117 projects now.

• The European Investment Advisory Hub
• The European Investment Advisory Hub is Europe’s

gateway to investment support. A joint initiative by the European Commission and the European Investment Bank under the Investment Plan for Europe, the Hub offers a single access point to a 360 degree offer of advisory and technical assistance services with the aim of strengthening Europe's investment and business environment.

What is the Circular Economy?

• Maintaining the value of products, materials and

resources in the economy for as long as possible while minimising waste generation

• To boost our economy and competitiveness with

new business opportunities and innovative products and services.

• For economic, social and environmental gains

Circular economy

Potential of the Circular Economy?

• Reduction of 500 million tons of GHG between 2015

and 2035(4)

• Up to 600 billion savings – 8% of annual turnover for business in

the EU (2)

• Possible 170 000 direct jobs in waste management sectors created

by 2035

• For economic, social and environmental gains

Circular economy

From a Linear Economy…

… to a Circular Economy

Objectives of the new Package

• Synergies between environment and business

agendas

– Preserve resources while creating business opportunities – Closer links to other key EU priorities: climate and energy, jobs and growth, investment, innovation, social, industrial competitiveness

• Propose concrete and ambitious action where EU

intervention has high added value

– e.g. long-term vision and targets on waste management; internal market rules for products; environment and consumers protection; regulatory obstacles or enforcement issues; innovation and investments

The Circular Economy Package

• Adopted by the Commission on 2nd December 2015

Action Plan Communication List of Follow-up Initiatives (Annex) Legislative proposal on waste

Action Plan

New targets – packaging waste recycling

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Existing targets 2012 (latest data) Target 2025 Target 2030

% Prep for resue and recycling

Plastic Wood Ferrous metal Aluminium Glass Paper and cardboard Overall → Repeal of the recovery and max recycling targets → Clarification on measuring (same approach as for municipal waste)

Circular economy

Extended producer responsibility

Minimum requirements to be respected by Member States when developing and applying EPR, including:

• Definition of the roles and responsibilities of the actors
• Defining measurable targets and a reporting procedure
• Information, transparency, dialogue
• Full cost coverage
• Monitoring by Member States
• Link between the product's true end-of-life cost

and fees to be paid by producers

Circular economy (2)

CCAs: Cumulative cost assessments (CCAs) identify and quantify the various types

• f cost impacts (monetary obligations, CAPEX, OPEX, administrative burden, etc.)

borne by a given industrial sector so as to comply with specified EU legislation. Focus: DG GROW has focused on the CCAs of EIIs (Energy Intensive Industries), as they are subject to numerous EU regulations. The aim is to cover the major EIIs. Time-line: so far, three CCAs have been already published - with very different results, and two more are being completed. They have been based on solid data, which in many cases have been collected at plant level. CCA for Steel published (2013)* CCA for Aluminium published (2013)* CCA for Chemicals published (2016)** CCA for Forest-based Industries (“F-BI”) being published (2016) CCA for Ceramic and Glass to be published (2017)

* See http://ec.europa.eu/growth/sectors/raw- materials/industries/metals/index_en.htm ** See http://ec.europa.eu/growth/sectors/chemicals/ec-support_en 20

GROW

Cumuative Cost Assessment (CCA): Overview

The CCA F-BI employed the same basic methodology as its predecessors (streel, aluminium, chemicals), as far as possible following the Better Regulation Guidelines (e.g. Standard Cost Model for admin. costs), developing clear, specific choices when needed and using secondary data to verify and augment data obtained directly from surveys of sectoral companies and for non-EU countries. The main steps were: i) using a Mirror Group (key sectoral EU-level industrial federations) to prioritise EU legislation likely to have significant cost impacts & identify typical companies; ii) a pilot survey to test cost-related questions and survey issues; (NB the reporting problems for SMEs of furniture & printing led to excluding those sub-sectors); iii) a main survey and interviews for typical woodworking and pulp, paper & paperboard companies, spread across the EU, based on eight legislative packages; iv) an initial cost-impact calculation was verified via an on-line survey to many companies and secondary data used both to verify indirect costs (pulp & paper) and identify cost structures for non-EU countries; v) for each legislative package, the various types of cost impacts (monetary

• bligations, CAPEX, OPEX, administrative burden, etc.) were quantified for the period

2005-2014, not only for woodworking and pulp & paper but also some branches. Cost structures were also compared between the EU and Brazil, China and the USA.21

GROW

Methodology

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CCA Forest-based Industries (F-BI): woodworking; Direct legislative cost as % of added value: trends 2005-14

Results: Woodworking

GROW

23

CCA F-BI: woodworking: comparative direct legislative costs by package and cost type (averages 2005-2014)

Results: Woodworking

GROW

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CCA F-BI: woodworking: comparative cost structures (EU, Brazil, China, USA: averages 2005-2014)

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% EU CN BR US Raw materials Energy Labour Other costs

Cost Structures

GROW

CCA Main conclusions: Legislative costs vary significantly across different F-BI sub-sector and between woodworking sub-sectors, reflecting different product groups & production chains and hence company profiles (e.g. size, structure, efficiency etc.). The highest cost as % of added value is for wooden containers & packaging;the lowest in builders’ carpentry and joinery. The costs for wood-based panels and sawnwood as a % of those sub-sectors’ added values all in v-between those of wooden packaging and builders carpentry & joinery. Woodworking: cumulated legislative costs are mainly from: environment & phytosanitary, and climate & energy acts. By far the biggest single item is the cost of phytosanitary legislation born by the wooden containers & packaging sub-sector Globally, EU woodworking has a similar cost structure to China, thus much higher wood costs that Brazil or the USA.

Conclusions

GROW

ENTR G3

ENTR F3

Thank you!

Jeremy Wall

European Commission, DG Internal Market, Industry, Entrepreneurship and SMEs Unit C2 - Resource Efficiency and Raw Materials

jeremy.wall @ec.europa.eu

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