Europe has committed to ambitious sustainability targets in the coming decades, including achieving climate neutrality by 2050. This transition requires large investments while public budgets are under increasing pressure from security needs, inflation, ageing population, and other priorities. Published today, a European Environment Agency (EEA) analysis looks at this challenge and identifies investments in clean technology and green industry as key solutions to accelerate investments and progress towards the goals of the European Green Deal.
The EEA briefing ‘Investments in the sustainability transition: leveraging green industrial policy against emerging constraints’ looks ahead towards the next EU policy cycle and analyses key challenges and opportunities in ensuring ongoing implementation of the European Green Deal amidst competing societal demands and increasing concerns about fiscal sustainability of public policies.
According to the briefing, EU’s new green industrial policy can support public investments in sustainability and enhance private sector’s contributions for the sustainability transition. As the annual investment needs of the European Green Deal exceed half a trillion euros until 2030, private finance will be imperative to the transition’s success.
A new EU green industrial policy can be one of the levers to avoid standstills in green investments, the EEA briefing states. Moreover, both public and private sector investments need to be quickly scaled up, especially in the buildings and transport sectors, to achieve climate neutrality by 2050.
The EEA briefing identifies the proposed Net-Zero Industry Act as a key first step towards a new green industrial policy in Europe and it should be supported by horizontal EU-wide policies based on the single market. The European Commission proposed the Net-Zero Industry Act in March 2023 to strengthen the European manufacturing capacity of net-zero technologies and to accelerate Europe’s transition to climate neutrality.
