15 Jan 2020 EU Green Deal: €1 trillion investment to achieve carbon neutrality by 2050
“The transformation ahead of us is unprecedented,” said EU chief Ursula von der Leyen, announcing the investment plan.
The European Green Deal Investment Plan will mobilise EU funding and create an enabling framework to facilitate and stimulate the public and private investments needed for the transition to a climate-neutral, green, competitive and inclusive economy.
While the Green Deal is aiming to achieve carbon neutrality in the European Union by 2050, the EU also recently increased its emissions reductions target for 2030 to between 50% and 55% compared with 1990 levels.
The EU will also make sure that there is a just transition no one is left behind, according to Frans Timmermans, the European Commission executive vice-president in charge of its green policy. The Just Transition Mechanism (JTM) provides targeted support to help mobilise at least €100 billion over the period 2021-2027 in the most affected regions, to alleviate the socio-economic impact of the transition. The Mechanism will create the necessary investment to help workers and communities which rely on the fossil fuel value chain. It will come in addition to the substantial contribution of the EU’s budget through all instruments directly relevant to the transition.
The EU Green Investment Plan is based on three dimensions:
- Financing: mobilising at least €1 trillion of sustainable investments over the next decade. A greater share of spending on climate and environmental action from the EU budget than ever before will crowd in private funding, with a key role to be played by the European Investment Bank.
- Enabling: providing incentives to unlock and redirect public and private investment. The EU will provide tools for investors by putting sustainable finance at the heart of the financial system, and will facilitate sustainable investment by public authorities by encouraging green budgeting and procurement, and by designing ways to facilitate procedures to approve State Aid for just transition regions.
- Practical support: the Commission will provide support to public authorities and project promoters in planning, designing and executing sustainable projects.