Essay
The EU Single Market needs profound reform. We must place reuse, refill and repair at its heart, and enable a digital transition that is green and just for everyone. One concrete step leading the transformation should be ambitious EU ecodesign requirements for products and services, supported by inclusive harmonised European standards, and properly enforced by national authorities.
Read the full publication "30 years of the European Single Market: New visions for a green Europe"
Freedom of movement of people, goods and services is at the core of the EU Single Market. Alongside this freedom, the EU has historically sought to maintain a certain level of ambition in terms of safety, consumer protection, the environment and, not least, for the competitiveness of EU businesses.
Consecutive societal challenges, including the climate, energy and economic crises, require the EU Single Market to be futureproof and built for resilience. Over the next 15 years, its rules will need to adapt to respond to the urgency of mitigating climate change while keeping the use of natural resources within planetary boundaries.
The EU needs a resilient Single Market. For that, it will need a clear change of approach. The current take-use-dispose model must give way to a clean, circular and sufficiency-oriented economy that decouples resource use from well-being. Overproduction and overconsumption must be brought to a halt.
The EU Single Market also needs profound reform. We must place reuse, refill and repair at its heart, and enable a digital transition that is green and just for everyone. One concrete step leading the transformation should be ambitious EU ecodesign requirements for products and services, supported by inclusive harmonised European standards, and properly enforced by national authorities.
Product policy – a toolbox to embed sustainability in global markets
The core regulatory framework in charge of driving circularity in the European Union at a large scale in the next decades is the Ecodesign for Sustainable Products Regulation (ESPR), together with a series of delegated acts the European Commission will issue to regulate specific aspects of products. These legal instruments have the potential to make the circular economy a reality. They will establish minimum requirements to enable sustainable and energy-efficient product cycles based on reuse, repair and refurbishment, as well as, at the end of long, useful product lifetimes, recycling.
The ESPR and subsequent implementing rules will apply to every product traded on the EU market, including those manufactured elsewhere. This has the potential to drive sustainability along global value chains and create positive ripple-down effects on global markets.
Making sustainable services the norm will also be paramount. One of the objectives of the ESPR is to maintain products in use for as long as possible. For that, it is important to consider that the willingness to perform hardware upgrades, refurbish and repair relies heavily on the availability of software and firmware updates.
Such non-physical aspects go hand in hand with driving more sustainable and circular product policy. In a digital world, online services are becoming ever more prominent. They rely on energy-greedy systems, which need to be regulated beyond hardware. According to estimations, the increased use of cloud services (cloud computing, online gaming and streaming, to mention a few) will cancel out any energy efficiency gains made on physical products – unless we do something to manage it.
Robust standards for a green transition
Technical standards will also be crucial. They provide the framework conditions for circularity to be deployed at a large scale in the European Single Market, supporting EU circular economy policy and the ESPR objectives to make sustainable products the norm. This includes European harmonised standards developed by recognised European organisations CEN, CENELEC and ETSI.
For product regulations, which are complex by nature, standards often provide the technical scaffolding behind policy. In fact, standards are the core instrument for seamless rules in the EU Single Market. In support of legal ambition, European technical standards have been providing the common industry-agreed rules to uphold certain labour, production and environmental objectives. In some cases, the use of European standards confers presumption of conformity with EU legislation. In those cases, standards are therefore considered part of EU law (when that happens, they are known as ‘harmonised standards’).
However, the fact that harmonised standards are part of EU law does not mean that they should replace legislation. Quite the contrary – it often happens that they pose barriers to the implementation of EU law by, for instance, creating obstacles to the uptake of innovative technology. While developing standards could seem an easier option, as it involves delegating technical work to standardisers, regulation remains the most democratic, appropriate and effective way to address societal concerns, especially in protecting health and the environment. Therefore, it is crucial to maintain environmentally ambitious policy goals and the supremacy of mandatory legislation over voluntary standards in areas of public interest such as the environment.
Standards are high on the EU political agenda
Since harmonised standards serve the broader public interest, it is also important that the standardisation process ensures transparency and openness and reflects multiple societal interests.
In February 2022, the European Commission published its EU Standardisation Strategy, emphasising the geostrategic importance of standardisation in the EU. Europe has made progress in developing a unique system for standard-setting that includes the inclusiveness of otherwise under-represented societal stakeholders, such as trade unions or environmental and consumer groups.
However, obstacles to effective participation remain. This is the case, for instance, when technical standards that serve EU policy are developed at the international or national levels, where stakeholder engagement is neither guaranteed nor sufficient. For societal interests to effectively participate, there is a need for a genuine political push at all levels. The EU Standardisation Strategy will set up a High-Level Forum to defend EU interests at the international level, but it falls short of concrete actions for the effective participation of relevant civil society experts in standardisation processes at all levels. As a consequence, this remains an open issue that the European Commission should address to ensure the standardisation system is inclusive.
Technical details for a transformational change
We expect an unusual influx of new and revised standards in the coming years. The upcoming plethora of ESPR product-specific regulations that will change the EU Single Market means that methods and technical specifications will also be in high demand. This will possibly entail the revision of existing standards or the development of new ones to account for new sectors, new testing procedures and new business models. Consequently, the success of the new legal requirements will highly depend on technical specifications, including harmonised standards. In order to ensure that adequate technical specifications are always readily available to support EU legislation, the European Commission is increasingly introducing the option to develop common specifications through implementing acts in its legislative texts, including in the ESPR proposal. This provides for a fallback option should the availability of suitable standards cause delays in implementing mandatory rules.
To ensure harmonised standards adequately support, rather than substitute, EU ambitions in terms of a sustainable circular economy, it is important to ensure EU policies are based on the best of both worlds. We need ambitious, clear and forward-looking requirements, combined with robust supporting definitions, test methods and assessment methodologies. For example, interoperability between reuse and refill systems can ensure these become a viable option against single-use. Harmonised and modular design of parts and components can ensure products from different manufacturers can be repaired and refurbished with the same parts. Homogenous and toxic-free material design can ensure components or recyclate from one industry can be kept within circular material loops rather than downcycled.
Such voluntary harmonisation of infrastructure, reverse logistics and circular systems will enable companies to create economies of scale in the long run. With the standards supporting the ESPR, the EU has an opportunity to act as the leading setter of standards in the international arena. In cases where existing international standards fall short in matching the European environmental ambition, the EU should push the global agenda.
Countering non-compliance through effective market surveillance
Ensuring that products are compliant with legal requirements, and in particular ecodesign requirements, is key to fulfilling the objectives of the ESPR. Market surveillance includes the monitoring, verification and enforcement of national and European legislation for products placed on the EU Single Market.
Without control, non-compliant products could be sold freely, putting companies that actually comply with requirements at a disadvantage. This would distort competition and reduce incentives to comply, jeopardising confidence in legislation and posing risks to health and the environment.
It has been estimated that, for instance, as much as 10-25% of products placed on the market currently do not comply with the energy labelling requirements, which means that approximately 10% of the anticipated energy savings are lost due to non-compliance.
A contributing factor is the lack of controls throughout the EU. Market surveillance is a competence of Member States. Studies have shown that the resources dedicated to market surveillance are insufficient, especially in terms of human and financial resources.
The ESPR proposal is on the right track to address some of these flaws by expanding the provisions on market surveillance. The proposal addresses measures to avoid circumvention, and contains provisions that would empower the European Commission to set a minimum number of checks on products to be carried out by the market surveillance authorities. The proposed framework could go even further and target all economic operators, including online marketplaces, make repeated cases of non-compliance public and establish a system of compensation for consumers who purchased non-compliant products.
The EU Single Market holds all the cards to mainstream sustainability and high environmental ambition in the next decade. To make it happen, we will need an ambitious ESPR, underpinned by a set of powerful tools: ambitious requirements, robust technical standards, the inclusion of civil society organisations and enhanced compliance. With the instruments in place, the EU economy could soon become truly circular.
