Fostering energy efficiency is a prerequisite of sustainable development. A recently published Synthesis Report argues that the entire innovation ecosystem and the relationships within shall be analysed when promoting energy efficiency especially in countries like Eastern Partnership Countries of the European Union. A more systemic understanding is in order to stimulate the necessary paradigm shift towards more qualitative growth that enhances life.
Works on secular stagnation hypothesis have been blossoming (Teulings and Baldwin 2014; Eggertsson and Summers 2016). Even there are some caveats, one message to convey is that advanced countries – including Europe – must seek for a paradigm shift towards more qualitative growth. What Europe needs today is that what was proposed 32 years ago by the French economist, Yves Berthelot: “The transition to a new form of growth will not be able to be accomplished without a mastery of industrial structural transformation.” (Berthelot 1983:20).
The decision about the seventeen Sustainable Development Goals in the fall of 2015, as the successor of the United Nations’ Millennium Development Goals, demonstrates the widespread view that people and our planet need qualitative growth that enhances life. This concept views the economic, social and environmental systems as a mutually interdependent integrated living ecosystem of which growth process should shift from quantitative to a more qualitative growth featured with more efficient innovations in production processes and services by internalising environmental costs, involving renewable energies, zero emissions, continual recycling of natural resources, and restoration of the Earth’s ecosystems.
Interestingly, the goals are interspersed with the spirit of energy-awareness (e.g. increasing clean energy, well-being can also be spurred by pursuing energy efficiency, sustainable cities etc.). The experience of advanced and developing countries conveys the message that sustainable economic dynamism (quantitative and qualitative growth) is of essence because rising income levels are associated with observable decline in energy intensity (IPCC, 2000; Metcalfe, 2008). Stimulating socio-economic dynamism is therefore of key importance in coping with challenges like avoiding locking in energy inefficiency to reach eco-efficiency in the EU as well in securing the shift to a more qualitative growth. This approach shall reach even the Eastern Partnership Countries (EPCs) of the EU as well, such as Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine.
R&D&I for energy efficiency in EPCs – Institutional architecture matters
In a recent Synthesis Report prepared by ICEG European Center (Kovács, 2016a), we analysed the results of the national studies on major drivers, barriers and bottlenecks to increase energy efficiency in the innovation ecosystems of EPCs. The studies were prepared within the project INNOVER-EAST. In addition to identifying the major barriers and bottlenecks that are largely interrelated and are influencing the absorption, diffusion, demand and supply of R&D&I, the report also outlines policy recommendations with a list of potential innovation support services.
The report reveals inter alia that despite SMEs are employing almost 50% of the labour force in most EPCs, SMEs fall short in contributing to the GDP (on average 30% of the GDP is given by them) as compared to what extent SMEs do in OECD countries where more than 55% is determined by SMEs activity.
