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What drives Environmental Innovations in the Nordic Pulp and Paper Industry?

Green Markets and Cleaner Technologies (GMCT)

image of What drives Environmental Innovations in the Nordic Pulp and Paper Industry?

Policy initiatives have highlighted the importance of environmental innovations as a solution to environmental problems, and looked into ways to promote them. Based on empirical cases in the Nordic pulp and paper industry, this report explores environmentally sounder technological innovations and their relation to societal and economic drivers. The cases studied include the use of production by-products for energy, new products in the core business areas and new product value chains. The report shows that public policy has directly influenced environmental innovation in the P&P industry through providing public R&D support, funding development projects and encouraging cooperation. It has also facilitated the crucial stage of demonstration by creating or enforcing markets for environmental innovations. The success of policy-created markets in supporting innovation is, however, crucially dependent on other market changes that push the development towards improved environmental performance. Environmental policies alone are seldom sufficient drivers for innovations.

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Key factors affecting the innovation process

The cases of inventions and innovations examined in this study enable the identification of some key drivers and barriers for environmental innovations. Chapters 2 and 3 showed that the key drivers include markets that support more environmentally oriented innovations, often spurred by policy or customer pressure; access to a variety of relevant knowledge; environmentally oriented public and private funding; and new networks of actors. The development of bioenergy-related technologies in the Nordic pulp and paper industry shows, however, that in addition to the type of drivers also the ratio or the relationship between drivers and barriers matters (see Box 1). Public policies, although not important in each individual case, can create a framework that supports environmental innovation and help to idwntify potential inefficiencies.

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