Committee members acknowledge the need for the establishment of the EIT – namely a failure to realise research and development breakthroughs in commercial reality.
But they are concerned about the division of the EIT into six knowledge and innovation communities (KICs) which will seek to encourage partnerships between businesses, higher education institutions and research organisations.
The Lords' committee's chairperson, Baroness Thomas of Walliswood, believes the KICs do not sufficiently encourage the private sector's involvement.
"The [European] Commission has identified a real problem in Europe's inability to take full commercial advantage of its strengths in education and research; and we accept that [an EIT] could make a positive contribution to solving the problem," she said.
"However we are concerned about the way in which the Commission is proposing to set up the EIT. Our view is that the approach they suggest does not provide European businesses with the incentives they will need to become heavily involved, and hence to make the EIT a success."
Click here to run an energy price comparison, and see if you could be paying less for your gas and electricity.