The European Commission has revealed details of its Sustainable Europe Investment Plan, suggesting a financial roadmap for reaching net-zero carbon emissions by 2050.
On 11 December 2019, the Commission presented the European Green Deal, with the ambition of becoming the first climate-neutral bloc in the world by 2050.
The plan will involve mobilising investment of 1 trillion euros to help finance its flagship project, the European Green Deal.
The European Green Deal’s Investment Plan – the Sustainable Europe Investment Plan presented today will “mobilise public investment and help to unlock private funds through EU financial instruments, notably InvestEU”, according to a European Commission statement.
It also said that some regions will be particularly affected and will undergo a profound economic and social transformation.
The President of the European Commission, Ursula von der Leyen, said: “People are at the core of the European Green Deal, our vision to make Europe climate-neutral by 2050. The transformation ahead of us is unprecedented. And it will only work if it is just – and if it works for all.
“We will support our people and our regions that need to make bigger efforts in this transformation, to make sure that we leave no one behind.
In addition, a new circular economy action plan will be revealed in March 2020, as part of a broader EU industrial strategy.
Octopus Renewables, part of Octopus Group, is a specialist clean energy investor and one of the largest commercial solar investors in Europe.
“Moving to an economic model not based on burning fossil fuels is a game changer. Yet it remains to be seen if this roadmap to net-zero carbon by 2050 is actually achievable,” said Alex Brierley, co-head of Octopus Renewables.
Brierley continued: “The guardians of trillions of dollars of capital have a crucial role to play in executing this transition. From our research, two things are clear: institutional investors believe their investment strategies can be used to make a material difference to climate change, and some are actively taking steps to decrease their exposure to fossil fuels. Pension funds are acutely aware of rising public pressure, and a new roadmap should help them take the necessary steps to tackling climate change.”
However, the pace of change isn’t happening fast enough, according to Brierley. “Many investors have no allocation to climate-saving assets at all. To unblock investment into sectors like renewable energy, institutions need to become more comfortable with different types of investment risks. The required change demands more dynamic investment strategies with wider scopes. Acting now is not an option – it is a necessity,” he added.
Europe’s transition to a sustainable economy means investment efforts across all sectors; reaching the current 2030 climate and energy targets will require additional investments of EUR260 billion a year by 2030.
Executive Vice-President for the European Green Deal, Frans Timmermans, said: “The necessary transition towards climate-neutrality is going to improve people’s well-being and make Europe more competitive. But it will require more efforts from citizens, sectors and regions that rely more on fossil fuels than others.”
—
