ENVIRONMENTAL PROTECTION INVESTMENTS

    Descrizione 1
    Update date
    Authors

    Nicolò G. Tria

    Abstract
    Immagine
    Abstract

    After the declines that had continued since 2017, in 2021, fixed capital investments (technologies) for environmental protection made by industrial enterprises recorded a significant increase of 81.0%, rising from €806 million to €1,454 million, marking a new local maximum. This increase was mainly driven by the electricity and gas supply industry (+135.5%) and the manufacturing industry (+103.9%). Companies continue to prefer end-of-pipe technologies over integrated ones, with a ratio of approximately 60:40. However, the latter recorded the largest increase, both compared to the previous year (+104.3%) and to 2016 (+21.0%).

    Examining the period 2016–2021, it is noted that the environmental expenditure classes in which industrial enterprises invested the most cumulatively are "CEPA2: Wastewater management" (€2,140 million); "CEPA1: Air and climate protection" (€1,763 million); and "CEPA6: Protection of biodiversity and landscape" (€1,334 million). In the same period, the overall sectoral trend variation is +8.8%, with wide divergences, both positive and negative, among the sub-sectoral sections.

    Description

    The indicator measures auxiliary expenditure in investments, in fixed capital and gross of depreciation, for environmental protection, borne by industrial enterprises. The statistical unit is the auxiliary producer company, i.e., business units that produce environmental services exclusively for their own use, without selling them to third parties on the market.

    According to the ATECO 2007 classification—2022 update, the narrow sense of industry includes the economic activity sections 'B' (Mining and quarrying), 'C' (Manufacturing), 'D' (Electricity, gas, steam, and air conditioning supply), and 'E' (Water supply; sewerage, waste management, and remediation activities). Therefore, construction companies are excluded. This indicator is based on the European NACE Rev.2 classification, which further excludes companies engaged in sewerage activities, waste collection, treatment and disposal activities, materials recovery, and remediation activities and other waste management services (corresponding to ATECO divisions 37, 38, and 39).

    The international classification CEPA2000 (Classification of Environmental Protection Activities and expenditure) constitutes the reference standard of the Community Regulation for structural statistics and is part of the SERIEE system (Système Européen de Rassemblement de l’Information Economique sur l’Environnement), the system dedicated to the satellite accounting of environmental expenditures developed by Eurostat.

    The transactions of the satellite account of environmental protection expenditures carried out by enterprises (i.e., capital investments, excluding current expenditures) are presented, where relevant, for each CEPA class (or their groupings): 1. Air and climate protection; 2. Wastewater management; 3. Waste management; 4. Soil and groundwater protection; 5. Noise and vibration abatement; 6. Protection of biodiversity and landscape; 7. Radiation protection; 8. Research and development for environmental protection; 9. Other environmental protection activities.

    Monetary investment values, where relevant, are disaggregated by technology type: a) specific machinery and accessories for environmental protection ("end-of-pipe" technologies) and b) equipment and plants with cleaner technology (integrated technologies). The former refers to investments in pollution control and reduction technologies that intervene after pollution has been generated (downstream); the latter, on the contrary, consist of investments in technologies and plants that prevent or reduce pollution at the source (upstream and throughout the production process).

    Purpose

    The purpose is to assess investments in environmental protection by industrial enterprises and their evolution over time. This information is crucial in evaluating the degree of contribution of the industrial system to environmental safeguarding.

    Policy relevance and utility for users
    It is of national scope or it is applicable to environmental issues at the regional level but of national relevance.
    It can describe the trend without necessarily evaluating it.
    It is simple and easy to interpret.
    It provides a representative picture of environmental conditions, environmental pressures, and societal responses
    It provides a basis for international comparisons.
    Analytical soundness
    Be based on international standards and international consensus about its validity;
    Be theoretically well founded in technical and scientific terms
    Presents reliability and validity of measurement and data collection methods
    Temporal comparability
    Spatial comparability
    Measurability (data)
    Adequately documented and of known quality
    Updated at regular intervals in accordance with reliable procedures
    An “adequate” spatial coverage
    An “appropriate” temporal coverage
    Main regulatory references and objectives

    Community Regulation (EC) No. 295/2008 on structural statistics requires the statistical institutes of Member States to collect and provide Eurostat with data on investments in pollution abatement plants and equipment, distinguishing between end-of-pipe investments and those with integrated technology. The disseminated data comply with the requirements established by Commission Delegated Regulation (EU) No. 125/2022 (which amended the previous Reg. 691/2011 on environmental economic accounts). No legal targets are set for this indicator.

    DPSIR
    Response
    Indicator type
    Descriptive (A)
    Context (F)
    References

    ISTAT, Statistics Report, Various years, Investments by industrial enterprises for environmental protection.

    EUROSTAT, Various years, Statistics Explained, Environmental protection expenditure accounts.

    Limitations

    With the February 2023 edition, the data series have been revised following the introduction of innovations and improvements in methods and sources. As a result of the revisions introduced, the new series are available starting from 2016 and are not comparable with previous editions.

    Moreover, the gross fixed investment series are not fully comparable over time, since starting from 2017, the data from the surveys used as sources for the estimates are produced according to a new definition of the statistical unit, in order to ensure comparability of data at the EU level. Until 2016: 1 enterprise = 1 legal unit. From 2017 onwards: 1 enterprise = multiple legal units.

    Interpretative caution: an increase in investments in technologies aimed at environmental protection may imply an improvement in the environmental performance of industrial enterprises and, consequently, in the state of the environment (e.g., pollution reduction); conversely, a reduction does not necessarily imply a net worsening.

    Further actions

    -

    Frequenza di rilevazione dei dati
    Biennale
    Fonte dei dati
    EUROSTAT (Ufficio Statistico delle Comunità Europee)
    ISTAT (Istituto Nazionale di Statistica)
    Data availabilty

    I.Stat database at dati.istat.it under the entry:

    • Conti nazionali/
      • Conti ambientali/
        • Spese per la protezione dell’ambiente/
          • Investimenti, consumi intermedi e produzione ausiliaria delle società come produttori ausiliari per attività economica (Edizione Feb-2024)

     

    Spatial coverage

    National

    Time coverage

    2016-2021

    Processing methodology

    The basic data are presented as is or following minimal mathematical processing (e.g., year-on-year percentage change).

    Update frequency
    Year
    Qualità dell'informazione

    The data are documented and of good quality. They derive from two distinct statistical surveys (ISTAT): one relating to "Small and medium-sized enterprises and the exercise of arts and professions" (sample survey on enterprises with fewer than 100 employees) and the other relating to the "Enterprise Accounts System" (census-based on larger enterprises). The indicator is reliable, simple, and easy to interpret, comparable over time and space, and allows for international comparisons.

    State
    Good
    Trend
    Steady
    State assessment/description

    In 2021, industrial enterprises' investments in environmental protection amounted to €1,454.3 million, a significant increase (+81.0%) compared to €803.5 million in the previous year. Regarding technology type, the increase appears to be mainly supported by investments in integrated technologies, which doubled (+104.3%), but the increase in end-of-pipe technologies is also significant (+68.2%) (Table 1 and Figure 1). However, the tendency of industrial enterprises to favor investments in end-of-pipe technologies (€872.5 million), i.e., devices for downstream pollution treatment, such as flue gas abatement technologies, wastewater purification, and remediation, over integrated technologies capable of removing or reducing pollution at the source (€581.8 million), is confirmed.

    More specifically, examining investments in end-of-pipe technologies (Table 3 and Figure 4), it is noted that 30.9% is allocated to "air and climate protection" (€269.4 million); 24.1% to "wastewater management" (€210.2 million); 20.6% to waste management (€179.7 million). On the other hand, among integrated technologies, industrial enterprises continue to allocate more than half of capital investments, 58.4%, to "protection of biodiversity and landscape" (€339.6 million); 13.2% to "waste management" (€77.0 million); 11.3% to "wastewater management" (€65.7 million); and 10.8% to "air and climate protection" (€30.7 million) (Table 3 and Figure 5).

    Looking at the different economic sections of the industry, in 2021, the electricity and gas supply industry surpassed the manufacturing industry as the top investor in environmental protection, with €650.7 million (+135.5%) compared to €589.9 million (+103.9%) for the latter (Table 2 and Figure 6). Only the water collection, treatment, and supply industry, contrary to the trend, substantially reduced the volume of investments (-34.5%) compared to the previous year.

    All expenditure classes show a positive variation compared to the previous year, some very significant (Table 5 and Figure 2), except for "CEPA5: noise and vibration abatement" (-10.1%, consistent with the long-term downward trend).

    Trend assessment/description

    In the period 2016–2021 (Table 1 and Figure 1), the minimum period over which historical series data are comparable, a change in the trend sign is recorded, becoming positive (+8.8%): industrial enterprises' investments in environmental protection exceed the previous local maximum (€1,336.3 million in 2016) and set a new local maximum at €1,454.3 million. The highest increase is in integrated technologies (+21.0%), from €480.8 to €581.8 million, while end-of-pipe technologies barely recover the initial series value (+2.0%), from €855.5 to €872.5 million.

    The mining industry (which continues its growth dynamics), electricity and gas supply, and the manufacturing industry (which this year reverse the slope and grow) show positive trend variations (128.7%, 42.9%, 6.0%, respectively); only the water collection, treatment, and supply industry is negative (-59.4%) (Table 2 and Figure 3). The manufacturing industry remains at the top for cumulative investment volumes (€2,959.9 million), mostly in end-of-pipe technologies, followed by electricity and gas supply (€2,420.5 million). The trend is slightly upward, despite the 2020 collapse, thanks to the 2021 rebound: +6.0%, from €556.3 to €589.9 million.

    The environmental expenditure classes in which industrial enterprises invest the most cumulatively are confirmed, in order, as "CEPA2: Wastewater management" (€2,139.7 million); "CEPA1: Air and climate protection" (€1,762.9 million); and "CEPA6: Protection of biodiversity and landscape" (€1,334.2 million) (Table 2 and Figure 8). The 2016–2021 trend variations of the expenditure classes are mixed (Table 5 and Figure 2): for example, extremely positive "CEPA3: waste management" (+267.9%); significantly negative "CEPA2: wastewater management" (-46.6%) and "CEPA5: noise and vibration abatement" (-66.0%).

    Comments

    A focus is proposed on selected divisions of the manufacturing industry whose specific emissions and CO₂ emissions are monitored by dedicated indicators within the industry theme. The ATECO 2007 economic divisions considered for comparison are: "17: Manufacture of paper and paper products"; "20: Manufacture of chemicals and chemical products"; "23: Manufacture of other non-metallic mineral products"; "24: Metallurgy"; "25: Manufacture of fabricated metal products, except machinery and equipment"; and "28: Manufacture of machinery and equipment n.e.c."

    Short- and medium-term trends are mixed (Table 4 and Figure 7): there is a consistency in trend between the 2020–2021 and 2016–2021 variations for the paper industry (141.5% and 23.7%, respectively), but a divergence in metallurgy (+109.1% and -27.3%) and fabricated metal products (+97.1% and -40.4%). Unfortunately, the series for the divisions "Manufacture of chemicals and chemical products" and "Manufacture of other non-metallic mineral products" end in 2019.

    Data
    Headline

    Table 1: Environmental protection investments by industrial enterprises, by type of technology

    Data source

    ISPRA elaboration based on ISTAT data

    Note

    Gross fixed investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies) are aggregated. The total includes all CEPA expenditure classes (1–9). Monetary values are expressed at current prices. The term "industry in the strict sense" refers to industry excluding construction, sewerage management, and waste collection, treatment, and disposal activities. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded. Starting from the February 2023 edition, the data series have been revised following the introduction of innovations and improvements in methods and sources. As a result of these revisions, the new series are available from 2016 onward and are not comparable with previous editions.

    Headline

    Table 2: Environmental protection investments by industry and its sections

    Data source

    ISPRA elaboration based on ISTAT data

    Note
    Gross fixed investments in machinery and equipment specifically intended for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies) are aggregated. The total refers to all CEPA expenditure categories (1–9). Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense. With the February 2023 edition, the data series were revised following the introduction of methodological improvements and innovations in data sources. As a result of these revisions, the new series are available from 2016 onward and are not comparable with previous editions.
    Headline

    Table 3: Environmental protection investments by industry, its sections, subsections, and divisions, by type of technology and CEPA category

    Data source

    ISPRA elaboration based on ISTAT data

    Note

    Gross fixed investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies) are accounted for. The sum of all CEPA expenditure categories (1–9) is provided. Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded. With the February 2023 edition, the data series have been revised following the introduction of innovations and improvements in methods and sources. As a result of these revisions, the new series are available from 2016 onward and are not comparable with previous editions. For the series "manufacture of chemical products" and "manufacture of other non-metallic mineral products," data are available only up to 2019 (February 2022 edition), and CEPA expenditure classes from 4 to 9 are grouped.

    Headline

    Table 4: Environmental protection investments, selected divisions of the manufacturing industry

    Data source

    ISPRA elaboration based on ISTAT data

    Data legend
    nd "non disponibile"; na "non applicabile"
    Note
    Gross fixed investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies) are aggregated. The total for all CEPA expenditure categories (1–9) is presented. Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense. With the February 2023 edition, the data series have been revised following the introduction of innovations and improvements in methods and sources. As a result of these revisions, the new series are available from 2016 onward and are not comparable with previous editions. For the "manufacture of chemicals" and "manufacture of non-metallic mineral products" series, the available data are up to 2019 (February 2022 edition).
    Headline

    Table 5: Environmental protection investments by industrial enterprises, by CEPA category

    Data source

    ISPRA elaboration based on ISTAT data

    Note

    Gross fixed investments and acquisitions less disposals of non-financial non-produced assets are reported, including investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies). Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense.

    Thumbnail
    Headline

    Figure 1: Environmental protection investments by industrial enterprises, by technology type (M€, 2016-2021)

    Data source
    ISPRA elaboration based on ISTAT data
    Note
    Gross fixed investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies) are reported. The total for all CEPA expenditure categories (1–9) is provided. Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense.
    Thumbnail
    Headline

    Figure 2: Environmental protection investments by industrial enterprises, by CEPA category (M€, 2016-2021)

    Data source
    ISPRA elaboration based on ISTAT data
    Note
    Gross fixed investments and acquisitions less disposals of non-financial non-produced assets are reported, including investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies). Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense.
    Thumbnail
    Headline

    Figure 3: Environmental protection investments by industrial activity section (M€, 2016-2021)

    Data source

    ISPRA elaboration based on ISTAT data

    Note

    Gross fixed investments and acquisitions less disposals of non-financial non-produced assets are reported, including investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies). Monetary values are expressed at current prices.

    Thumbnail
    Headline

    Figure 4: Composition of end-of-pipe technology investments for environmental protection, industrial enterprises, by CEPA category (M€, 2021)

    Data source
    ISPRA elaboration based on ISTAT data
    Note
    Gross fixed investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) are accounted for. Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense.
    Thumbnail
    Headline

    Figure 5: Composition of integrated technology investments for environmental protection, industrial enterprises, by CEPA category (M€, 2021)

    Data source
    ISPRA elaboration based on ISTAT data
    Note
    Gross fixed investments in cleaner technology equipment and plants (integrated technologies) are accounted for. Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense.
    Thumbnail
    Headline

    Figure 6: Environmental protection investments, selected divisions of the manufacturing industry (M€, 2016-2021)

    Data source
    ISPRA elaboration based on ISPRA data
    Data legend
    The inner ring represents 2019, while the outer ring represents 2020.
    Note
    Gross fixed investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies) are accounted for. The total for all CEPA expenditure categories (1-9) is presented. Monetary values are expressed at current prices. For the series "manufacture of chemicals" and "manufacture of non-metallic mineral products," the available data are up to 2019 (February 2022 edition).
    Thumbnail
    Headline

    Figure 7: Environmental protection investments by industrial enterprises, by CEPA category (M€, total from 2016 to 2021)

    Data source
    ISPRA elaboration based on ISTAT data
    Note
    Gross fixed investments and acquisitions less disposals of non-financial non-produced assets are reported, including investments in machinery and specific equipment for environmental protection (end-of-pipe technologies) and in cleaner technology equipment and plants (integrated technologies). Investments for all years from 2016 to 2021 are summed. Monetary values are expressed at current prices. Divisions 37, 38, and 39 of the ATECO 2007 classification are excluded from the definition of industry in the strict sense.
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