1. A European Technology Platform for Sustainable Chemistry EIB Funding for RTD Sustainable Chemistry Needs & Examples ETP Industrial Leaders Meeting Brussels - 17 th October 2006 Russel Mills – Dow Europe

2. European Investment Bank seminar with European Technology Platforms – 17th October 2006 2 Overview Funding Strategies & Goals from SRA & IAP 2 Project Examples –“Factories of the Future” –“Homes of the Future” + Background info for inter ETP follow up “Factories” simpler to finance, but “Homes” larger €

3. European Investment Bank seminar with European Technology Platforms – 17th October 2006 3 Funding Strategy & Goals Our stakeholders are diverse (the “Chemistry using industries”) –but share common sustainability goals We are the current global leader –future EU leadership in “Sustainable Chemistry” relies on making broad range of technologies more sustainable Start with a broad based funding strategy –illustrate SusChem “added value” via higher visibility projects Sustainable Chemistry: invisible enabling element in product innovations

4. European Investment Bank seminar with European Technology Platforms – 17th October 2006 4 IAP financing needs based on bottom up project reviews –first draft IAP endorsed at Budapest stakeholder meeting (Aug 06) –End 08 appraisal/revision to clarify alternatives (JTI or broad) For FP7 theme, typical annual funding target ~ 50 Mn € –but combining themes, country programmes and industry contributions annual figure reaches ~ 1.5 Bn € Varying SusChem roles to support participating stakeholders Funding Strategy & Goals

5. European Investment Bank seminar with European Technology Platforms – 17th October 2006 5 Funding Facilitation Roles for 2007 Large Corporates Multinationals innovating in Europe participate in SusChem Typical interests: –Off balance sheet funding models for riskier consortia –Funding top ups to make “sustainability add-ons” viable Small & Mid caps Substantive variation in regional needs Initial focus on alerts and best practice sharing SMEs Outreach programme plan via National Suschem Platforms, MSMG & federation network (offices in all EU countries)

6. European Investment Bank seminar with European Technology Platforms – 17th October 2006 6 Example Projects & Needs (Bio) Factories of the Future –Pilot Plants & Demonstration Units (accelerate scale up) –Sustainability add-ons Bio-refineries: add sufficient value (versus burning waste) to minimise subsidies (Smart Energy) Homes of the Future –Portfolio of end product innovations (dependent on chemistry) to develop scaleable business models revenues from licensing, cost reductions via shared demonstration, LTCs and regional development rights

7. European Investment Bank seminar with European Technology Platforms – 17th October 2006 7 “Factories of the Future”

8. European Investment Bank seminar with European Technology Platforms – 17th October 2006 8 Integrated cluster of bio- industries Variety of technologies Producing chemicals, biofuels, food ingredients and power Using progressively lower value biomass as raw materials Integrated diversified Biorefinery

9. European Investment Bank seminar with European Technology Platforms – 17th October 2006 9 Financing issues despite Sunny outlook IB growth (next 5 years): 77 –> 125 Bn € 1.Largest € growth driver: Bio-fuels 2.Key public/sustainability issue: using lower value raw materials & adding more value to waste streams Financial markets support 1 not 2 PPP discussion points: –mixed loan equity models / demo unit funding / deferred interest on “development dependent” income streams / investor confidence issues / shifting public funds from production support to investment support Issue not more €, but when/where to use public funds

10. European Investment Bank seminar with European Technology Platforms – 17th October 2006 10 Energy / Resources High efficiency Thermal insulation Low cost Fuel cells/ batteries Efficient domestic appliances Phase changing materials Ultra Efficient lighting Photovoltaics Water and waste management “Homes of the Future”

11. European Investment Bank seminar with European Technology Platforms – 17th October 2006 11 Awareness enhancing technologies Domotics Smart materials Remote shopping Security Smartness Energy – Comfort - Health - Smartness Self cleaning surfaces Remote diagnostics - monitoring Sound insulation Sustainable consumer products Personalized nutrition Health / comfort Air quality Innovating up value chain Innovating for the “Public Good”

12. European Investment Bank seminar with European Technology Platforms – 17th October 2006 12 Why would a company invest in Smart Energy Home concept? Partner platform to facilitate testing and scaling up Direct feedback from end users ‘living innovations’ Implementing results of leading FP projects in real life solutions for consumers Different prototypes of ‘houses of the future’ Added value for participants

13. European Investment Bank seminar with European Technology Platforms – 17th October 2006 13 2008 Network & partners platform implemented 2012 Demonstration Phase > 2015 Commercial scale up: equity, licensing, or downstream partnerships options Indicative implementation planning

14. European Investment Bank seminar with European Technology Platforms – 17th October 2006 14 Portfolio Financing Issues PPP discussion points: –SME involvement to accelerate scale up –Demo unit funding to share risks –Risk/Revenue sharing across multiple developments & regions –Special funding vehicles to bridge gap between consortia or institutional “demonstrations” and “mass market” options

15. European Investment Bank seminar with European Technology Platforms – 17th October 2006 15 Some final thoughts … Our industry … good at building technology road-maps & classifying technical risks … less good at developing business plans to clarify future revenue streams and financial risks More sustainable production implies more sophisticated units …. multiple countries evaluating financial support for demonstration units …. …. opportunities to exploit joint financing at EU level We innovate on behalf of our downstream customers …shared financing with other ETPs can accelerate this cooperation