Within the last few decades, rising environmental concerns have forced policy-makers to act in an effort to mitigate further harm. Yet though green-house gas emissions and the wasteful use of natural resources are detrimental to the environment, policy-makers are reluctant to enact any green legislation that might undermine national competitiveness. Many now see the solution to lie in the development of new environmental technologies, which promise to address environmental problems while maintaining competitiveness. The effects of environmental technology on competitiveness are addressed in this ZEW study.