At the end of 2019, the European Commission set out its new sustainable growth strategy with the ‘Green Deal’. Then came the coronavirus crisis, which forced European policymakers to design an ambitious economic recovery policy called ‘Next Generation EU’. Broadly speaking, this programme is based on the same principles as the Green Deal, which makes it clear that the European member states are facing a ‘green recovery’.  Europe’s ambition is to move forward to a sustainable future instead of a setback to the status quo from before the coronavirus crisis. To VITO, this all sounds very familiar. ‘Creating economic impact out of sustainability: it's in our DNA.’

Although the coronavirus crisis is far from over, it is already clear that the economic devastation is unprecedented. No less than 98 percent of regular Flemish companies have experienced (or are still experiencing) serious problems, according to a recent survey by Flanders Circular and VITO. But the results of this survey also show a ray of hope: two thirds of the circular companies indicated that they had no shortage of raw materials during the crisis, thanks precisely to their local supply lines. In short: a circular business model offers certain advantages during a crisis.

New growth agenda

Let the transition to a (more) circular economy be just one of the core elements of the ‘Green Deal’, the green policy strategy that European Commission President Ursula von der Leyen proudly presented at the end of 2019. The Green Deal goes far beyond the ambition to make Europe climate neutral by 2050 – to which it is often reduced. In fact, this is an entirely new economic growth agenda, amounting to EUR 1,074 billion to be spent over the period from 2021 to 2027. ‘The special thing about the Green Deal is that the green, sustainable economy is really seen as an opportunity,’ says Arnoud Lust, Manager International Business Development at VITO. ‘Unlike in the past, “green” is no longer considered something that automatically costs money. On the contrary, the benefits outweigh the investments.’ At VITO, of course, this has been known for a long time. ‘Creating economic impact out of sustainability: it's in our DNA. It is nice to see this is now also reflected in the long-term strategic vision of the European Union.’

However, the coronavirus crisis forced Europe to set up another strategic investment programme. That became ‘Next Generation EU’. For example, in early summer 2020, European leaders decided to release no less than €750 billion for a post-coronavirus recovery policy. Remarkable: this economic recovery package draws from largely the same spirit as the Green Deal – it also relies heavily on digitalisation. Renewable energy, circular economy, resource efficiency, massive renovation of buildings, etc. By investing in these, Europe is aiming to pull itself out of the economic swamp. Each one of these is a theme on which VITO has been focusing for years. ‘Both the Green Deal and Next Generation EU are based on principles that are perfectly in line with our mission,’ says Bruno Reyntjens, Commercial Director of VITO. ‘Just add our task of stimulating the Flemish economy, and the picture is complete.’ Flemish companies can therefore expect a whole array of new initiatives in the coming years to help them become more sustainable and resilient. And they can count on VITO, which is a logical partner to work with in this area. Reyntjens: ‘Companies can come to us more than ever for collaboration on research projects and joint technology developments and, of course, for advice on strategies to be followed, in order to familiarise them with the wide range of subsidy instruments and investment opportunities. VITO mainly aims for a connecting role in this, for example within consortia of companies working together on one specific theme,’ says Reyntjens.

Round-table discussions

The green recovery will not only bear fruit in the long term. In the short term, it can also provide a considerable stimulus for the Flemish economy and employment, according to a thinking exercise that VITO carried out this summer – this took place as part of a round-table discussion on the role of the construction sector in an economic recovery policy. ‘Through green investments, for example, in the improvement of the built-up (urban) environment of Flanders, we can create a double effect,’ says Lust. ‘Upgrading the energy status of buildings or neighbourhoods has a positive climate impact, but also leads to economic gains in the form of increased employment and added value through the implementation of state-of-the-art new technologies.’ A good example of how economic profit can go hand in hand with environmental and climate benefits. It is no coincidence that the Green Deal aims to upgrade 3 % of the buildings in Europe each year, compared to just 1 % today.

The other round-table discussions organised by VITO on sustainable energy and the circular economy led to similar conclusions. The further development of a sustainable energy system, for example, will not only (help to) make Europe climate neutral by 2050, but will also make it much less dependent on fossil fuels from outside Europe. During the round-table discussion, it emerged that the energy world expects a stable framework in which clear, sustainable policy choices can be made. Here too, the clarity of the Green Deal serves as an example. As far as the circular economy is concerned, the benefits are clear: companies with circular operations do not only operate more sustainably, but are also more resilient – this crisis has proven that.

Focus on applications

In addition to the thematic content of the European growth and recovery plans, there are also strong similarities with VITO's business operations in terms of the destination of the financial support. ‘We notice that the Commission is focusing much more than before on pilot and demonstration projects,’ says Lust. ‘The research phase being closer to application and commercial valorisation. This is also the case at VITO: we mainly help companies with projects beyond the basic research phase.’ In addition, many funds from the Horizon Europe R&D programme and the European Regional Development Funds (ERDF) will be targeted at SMEs and start-ups – including through the well-funded Accelerator programme from the European Innovation Council (EIC). ‘Through the new support, start-ups and SMEs can develop new cleantech applications in collaboration with VITO. We will also inject existing VITO technologies into the economic landscape via spin-offs and licences,’ says Bart Swaelens, Head of Tech Transfer at VITO. ‘This is how we help generate new and sustainable economic activity.

Moreover, the focus on start-ups and small businesses in the European investment plans is ideal for Flanders, which has long relied on its strong SMEs. ‘And these companies are among our most important partners,’ says Lust. ‘The European strategy therefore corresponds to VITO's strategy in many areas.’

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