Description of the project
By endorsing the Paris Agreement on climate change, the European Union (EU) has committed itself to follow a path of sustainable economic growth. Greentech innovation is a key element of Europe’s net-zero strategy. Breakthroughs in the sphere of Green technology can ensure the EU reaches its environmental targets in a cost-efficient manner, by lowering the marginal CO2 abatement costs and the marginal cost of pollution reduction. Moreover, innovation can help EU firms to respond and adapt to the reality of an altered climate. The inevitable increase in the demand for green products and services presents unprecedented growth prospects for the European greentech sector.
The Knowledge Programme of the European Investment Bank (EIB) Institute channels its research grants through different schemes, one of which is EIB University Research Sponsorship (EIBURS) Programme. Politecnico di Torino has been selected by the EIB Institute for the EIBURS sponsorship to carry out research on the theme “The European Cleantech industry, the EU Green Deal and SME equity demand”, in cooperation with the European Investment Fund (EIF). The project is devoted to the improvement of our understanding of the European cleantech sector and seeks to provide an answer to the question of how cleantech firms contribute to the achievement of EU policy goals, and what policymakers can do to promote a healthy ecosystem. Lastly, it looks into the implications of the European Green Deal on equity demand from small and medium-sized enterprises.
Objectives
The overall goal of the project is to:
- analyze the actions that are undertaken by European cleantech firms to engage in transformative climate and innovation actions to align with the European Green Deal inspired policies;
- examine the association of the environmental innovation and the number of new investments made by venture capital (VC) investors in cleantech companies on environmental indicators;
- analyze the enabling factors for the development of European cleantech firms, with a focus on EU-level and country-level targeted policies and regulations and the different sources of financing;
- analyze the extent to which the implementation of policies and regulations affect both the propensity of cleantech firms to seek external equity financing and the equity offer by VC funds.
Activities
The project will involve four different research lines and the definition of a set of policy guidelines. The four main research lines will be the following:
- The mapping of cleantech in Europe: is aimed at building a complete dataset of cleantech companies (and related cleantech sub-categories that are central to the European Green Deal) with associated financial accounting information, patent data, and sources of financing. This research line will employ innovative and interactive data visualization tools and techniques to map the geographical distribution, the evolution over time, the current size, the patenting activities, and the sources of financing of the cleantech sector.
- The European Green Deal and the transformative climate and innovation actions of cleantech firms: is aimed at exploring to what extent European cleantech firms take actions to drive their business towards the incorporation of the elements that are central to the European Green Deal in their technological development and investment activities. This research line will foresee the execution of a survey addressed to a selected sample of European cleantech firms on the elements of the European Green Deal they adhere to and will provide a mapping of the transformative climate and innovation actions that are implemented by cleantech firms to align with European Green Deal inspired policies. We will also examine the association of the environmental innovation and the number of new investments made by VC investors in cleantech companies on selected environmental indicators.
- The enabling factors for the development of cleantech firms: is aimed at exploring the effects of the implementation of specific and targeted policies and regulations (at both EU-level and country-level) that are central to the European Green Deal and the effects of different sources of financing on the financial and innovative performance of cleantech firms.
- Policies, equity offer and equity demand: is aimed at exploring the extent to which the implementation of policies and regulations affect both the propensity of cleantech firms to seek external equity financing and the offer of equity by VCs.