Synthesis report on low-carbon investments funding

The overall objective of the consolidated report of the seven target regions of PROSPECT2030 on Low Carbon Investments Funding is to deliver policy recommendations targeting mainly the macro-regional strategies (EUSDR, EUSAIR, EUSBSR, EUSALP) developed in Central Europe (CE) with particular focus on development of renewable energies (RES). Specifically, the Synthesis Report aims to conduct a structured assessment of the use of public funds dedicated to the development of the low carbon sector in the seven selected target regions of PROSPECT2030 over the 2014-2020 programming period.

The main policy conclusions and recommendations of the Synthesis report are as follows:

• The green economic transition is efficient driver of the environmentally sustainable economic recovery and growth. Beyond the impacts on the environmental and climate, it globally adds significant value to the competitiveness and restructuring of the economy, the development of the labour market, strengthened innovation and improved quality of life. Nowadays, this is getting to be more of an imperative from the perspective of the economic recovery form the coronavirus pandemic. 
  
  
• Better horizontal integration of green economic transition policy aspects and measurable low-carbon impacts into financial planning and planning and governance frameworks is still required. This also assumes a reinforced common methodological approach to assess the economic, social and environmental impacts of green investments. 
  
  
• For reaching the net-zero emission target by 2050, the perspective of the green economy transition being a challenge needs to be turned into opportunities with different EU investments. However, the scope of existing initiatives such as the European Green Deal, the European Green Deal Investment Plan and the Action Plan on Sustainable Finance include only the targets, but not yet tailored needs of each country and region.  
  
  
• It has become clear that capacity of public resources is far insufficient to support a dynamic market uptake in the green transition process. Therefore, in the next programming period, public funding should be focused to replace grants with financial instruments, and trigger effective leveraging of private funding from diverse sources.  
  
  
• However, it should also be acknowledged that there are certain low-carbon measures e.g. deep energy retrofit of buildings, whereby public grants may need to remain instrumental. In general, the public sphere and policies must address the unfavourable economics of immature low carbon technologies, enable companies to overcome threats to existing revenue models, and provide sufficient, long-term predictability for large transformational investments in capital intensive breakthrough technologies. Increased public financing is required to de-risk private investment and support the development of new infrastructure. Action on policies and regulation must be matched by action in the private sector and the regions’ demand, at which level the decisions to lend and invest will be taken.
  
  
• To achieve low-carbon goals in a more targeted and effective way, the creation of reinforced regional climate and energy programs/action plans are needed. These programs and action plans need to specifically address:

1. covering the entire low-carbon sector of the regions which generally calls for the coordination role of regional and local authorities beyond their normal sphere of competence (e.g. public housing, interregional transport);
   
2. setting energy efficiency targets specified for each region for different time horizon (short, medium, long term) along with the set policy goals;
   
3. reducing regions' energy consumption by improving energy efficiency across all its facilities (public and private buildings, public and industrial/commercial facilities, transport, etc.);
   
4. increasing the use of local renewable energies which are optimally tailored to the local conditions and resources;
   
5. achieving the targets defined for the regions with the help of financial incentives especially at undeveloped regions;
   
6. creating specific (possibly at local level) regulations and financial incentives for the most underdeveloped sectors like building renovation and transportation.
   
   

Full report in English available here

Within the context of the further implementation of PROSPECT2030, in the form of peer-to-peer learning activities, sharing the experience of the specific national and regional financial solutions as well as private co-financing schemes will be performed. All sessions are public and free: go the schedule here and join us!