Europe currently invests 534 billion euros annually in the energy, buildings, transport and cleantech manufacturing sectors. To reach the 878 billion euros required to meet the EU’s 2030 objectives, an additional 344 billion euros are needed each year. In addition, the European Commission estimates that about €70 billion per year is needed in climate adaptation. For an energy-independent future, a competitive Europe and to protect the population, the EU, Member States, subnational governments and the private sector must prepare to accelerate investment.

The proposed €2 trillion EU budget (2028 – 2034) will be at the center of attention.  With limited fiscal space in many Member States, combined with a growing number of challenges to tackle, a lot of debate will focus on the overall size of the EU budget, new revenue stream for the EU, and the headline priorities. Although the EU budget is a significant public investment muscle, at 1.26% of the EU’s GNI it will remain limited compared to the collective spending power of Member States. Therefore, getting the wider toolbox right – also beyond the EU budget – will be essential.

The European Competitiveness Fund (ECF) is the EU’s best bet at financing its clean industrial ambitions. It will need not only a strong public budget allocation but also a data driven approach to guide strategic choices and investment decisions for Europe’s industries of the future. The ECF must also boost the mobilisation of private capital, including from commercial banks. Despite the ambition to support the cleantech sector, the scale-ups struggle to secure long-term bank loans. The barrier is less of a shortage of capital than a shortage of bankable projects. Helping more projects reach bankability faster will require targeted early-stage public derisking tools, stronger equity support, and local ecosystem clusters.

With the future of the EU’s Emission Trading System also up for debate, the coming months will see the acceleration of important design discussions – from launching contracts for difference under the Industrial Decarbonisation Bank to refocusing the Innovation Fund towards riskier, highly innovative projects. Revenues are crucial not only for supporting national investment in decarbonsing the industry, but for supporting European mechanisms developing the climate innovation needed tomorrow. 

The proposal for a revised Governance of the Energy Union regulation, expected towards the end of the year, is an opportunity to reinforce clean transition implementation measures. Turning the current National Energy and Climate Plans into investment plans could actively steer economic transformation and guide public and private investment for both mitigation and adaptation measures. It would deliver on investors’ demand for clear and predictable national investment strategies in the medium term, increasing resilience in the face of future energy crises.

The EU’s Integrated Framework for Climate Resilience and Risk Assessment will also be unveiled towards the very end of the year. It should lift the Europe-wide ambition on adaptation policies. In a space of overlapping competences between local, regional, national and the EU level, proposals much offer clarity on the sticky issues of who pays for the much-needed adaptation measures across different levels of government.

The proposed introduction of a “climate resilience by design” approach in the next EU budget period can go some way in ensuring that resilience and adaptation considerations are embedded in EU-funded investments in for example infrastructure, water management, agriculture, energy, transport, buildings and civil protection. If the objective is efficiency in public spending, the challenge will be to ensure a solid application across EU funding programmes.

Finally, the recent EU Electrification Action Plan focuses on reducing the price gap between electricity and fossil fuels and sets the scene for a critical debate later in the year on the Union’s electrification target. Lowering the upfront costs for electrification for end-user, including households, will be essential to ensure buy in and public support for the clean transition. This will be the backdrop for I4CE’s forthcoming research, focussing on the affordability of electric vehicles or heat pumps for low- and middle-income households in the EU and the public policies needed to effectively deliver this.   

The political agenda this autumn will provide key opportunities for policy makers to develop structural responses to the overlapping crises, which ultimately come at a high cost. Our engagement to identify the levers of the transition, informing debates and guiding decisions continue in France, Europe and internationally. More details in the newsletter below.

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L’article From wake-up call to investment action est apparu en premier sur I4CE.

The recent heat wave in large parts of Europe reminds us that the forthcoming European framework for climate resilience and risk assessment comes with high stakes: it is about the safety of populations and the competitiveness of the European economy.

Over the past couple of weeks, agriculture and livestock farming were severely affected in large parts of Europe; homes were unlivable; public transport was struggling; energy infrastructure was challenged; classrooms and exam rooms were overheating; schools closed; sports events and cultural activities were cancelled…for many people there was a clear impact on their work life and daily routines.

Although there is both knowledge and tools at our disposal to put adaptation policies into practice, the heat wave exposed a lack of anticipation in Europe. At both the national and the local level, there will be lessons learnt about the actions and decisions which were effective, and those not to repeat.

While many adaptation measures are planned and, above all, implemented by Member State and local authorities, the impact is Europe-wide. A European framework will support greater preparedness. First and foremost, establishing a common reference warming trajectory would provide a shared baseline. On this basis, the concept of “resilience by design” must become operational in EU funding programs, ensuring that every euro of European public money effectively contributes to the continent’s adaptation. Finally, some issues are European by nature—such as the EU Civil Protection Mechanism (rescEU) or certain cross-border infrastructure projects—and therefore require an adaptation strategy designed directly at EU level.

The climate has already changed and will continue to do so. This must be incorporated into every public—and private—decision-making process going forward. In a few years, the recent heat wave may well be the new summer norm. By then, emergency responses and last-minute measures can no longer be the norm.

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L’article The heat is on est apparu en premier sur I4CE.

Uncertainty over the rules for claiming credits is presented as a major barrier to financing European agricultural carbon credits. This uncertainty points directly to what is known as “double claiming”: when a farmer engages in a low-carbon project and sells carbon credits to a third party, the agri-food company that sources from them fears being unable to account for those same reductions in its own GHG inventory. As a precaution, many companies then turn away from these projects, and even discourage their suppliers from taking part.

Our new I4CE study “Double claiming of agricultural carbon credits: time to stop worrying” shows that this fear is largely unfounded. Counting a physical emissions reduction in one’s inventory and funding it are two separate things, and they can coexist: clarifying European regulation would be enough to remove the ambiguity. We hope this work will add a useful voice to the debate. 

Alongside this publication, we are releasing two further contributions: 

• Recommendations for certifying improved forest management, as work on a CRCF methodology in this area gets underway, amid concern over the capacity of the European forest carbon sink. 

• A policy brief on best practices for the future Buyers’ Club for European agricultural carbon credits. 

These contributions share one conviction: scaling up low-carbon agricultural and forestry practices depends as much on solid public and private financing as on pragmatic and transparent rules. 

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L’article Unblocking finance for low-carbon agriculture  est apparu en premier sur I4CE.

I4CE’s latest edition of the State of Europe’s climate investment shows that Europe is moving forward, but not fast enough. After a sharp increase following the 2022 energy crisis, investment in the low-carbon transition has stagnated. It reached 534 billion euros in 2025, well below the 878 billion euros needed annually to meet the EU’s 2030 targets. Unmet investment needs do not disappear. They pile up, widening the gap and increasing the cost to reach climate neutrality for future generations. Early signals in 2026 suggest that the new energy crisis could once again push investment upward. Sustaining the tendency will require robust long-term planning. 

Europe cannot afford another cycle of crisis-driven investment surges followed by years of stagnation. The current situation calls for both immediate measures to protect households and businesses from rising energy prices, but also for structural initiatives to mitigate the impact of future crises. The EU and its Member States have concrete tools at their disposal: pursuing and resourcing electrification plans at the EU level and nationally, prioritising the clean transition in the next multiannual EU budget,, maintaining the ambitions of the CO2 emissions standards for cars and vans regulation, and ensuring that the forthcoming revision of the EU emission trading system increases investment in industrial decarbonisation.   

Above all, these policy levers must provide investors, businesses, and citizens with the clear, stable, long-term signals they need to commit to an energy independent and low carbon future for Europe. 

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L’article Accelerating investment for an energy-independent and low-carbon future est apparu en premier sur I4CE.

These developments are affecting households’ ability to invest in transition solutions. We have therefore updated the analyses of our French Observatory of access conditions to the ecological transition for households and revised the key indicators used to assess the ability of middle- and low-income households to invest in an electric vehicle, a deep energy retrofit, or a heat pump.

Three main conclusions emerge from this update:

1. Under current conditions, buying a second-hand electric vehicle is becoming more advantageous than continuing to drive an old combustion engine car. With petrol prices exceeding €2 per liter and declining prices for second-hand electric vehicles, the energy savings cover the out-of-pocket repayments for purchasing a used electric car.

    

2. The out-of-pocket cost for a deep energy retrofit of a house has increased by €20,000 in 2026 and now exceeds €40,000. The sharp increase in public aid in 2024 has been completely offset by reductions this year. Nevertheless, for households that manage to finance the work, retrofit still generates savings. Indeed, the energy savings from a deep energy retrofit cover the out-of-pocket repayments of a zero interest eco-loan.

    

3. Installing a heat pump is becoming even more attractive for households in 2026. The revision of “Coup de pouce chauffage” (a bonus for replacing a heating system with a low-carbon solution) has reduced the out-of-pocket cost by €3,000 since last year. At the same time, rising fossil fuel prices are increasing the potential savings from installing a heat pump.

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L’article Electric cars, home reprofit, heat pumps: Can the middle class afford to invest in 2026? est apparu en premier sur I4CE.

In an op-ed for Les Échos, I4CE  Executive Director Benoît Leguet argues that French industrial policy must now pivot decisively from supply-side support to demand-side steering. The diagnosis is clear: firstly, gigafactories were built before critical input supply chains were secured. Secondly, not a single European synthetic fuel project has reached final investment decision in the absence of long-term offtake contracts with airlines and fuel providers. The toolbox to fix this exists, but is underutilised and is incomplete: mandatory environmental and local content criteria in public procurement, long-term contracts to secure offtake, standards that align private purchasing with industrial strategy. 

Some of the most powerful levers run through Brussels as much as Bercy – and the Industrial Accelerator Act and the design of the next European multiannual financial framework (2028–2034) are precisely the frameworks France should help shape.

This EU budget and in particular the proposal for a European Competitiveness Fund is the focus of a blog by cleantech researchers Ciarán Humphreys and Elena Schneider, reacting to the European Parliament’s ITRE committee draft report on the matter. The proposed Economic and Technological Advisory Council is a step forward for more targeted public spending, and a revival of some of the original ambition behind the Competitiveness Coordination Tool – but without a public data observatory and real coordination with Member States, €234 billion will not be enough to align twenty-seven national industrial strategies. 

In Paris or Brussels, it is clear that green industrial policy is no longer short of plans or political ambition. What is needed now is the coordination to pull demand, investment and disparate national interests in the same direction, towards a decarbonised, competitive industrial base.

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L’article Green industrial policy: building the market, not just the factory est apparu en premier sur I4CE.

With France 2030, the country is attempting to transform existing value chains, such as steelmaking, automotive and aerospace, from 20th century strengths into competitive industries for a decarbonising 21st century, while building the industrial and energy infrastructure necessary for that transformation to be one that is truly “Made in Europe”.

A project developer needs to be sure of their tools and materials before the workers can break ground. Any disruption to the supply of materials or connection to the grid leads to delays, cost overruns, and the prospect of failure. Transforming entire industries requires the same considerations, but on a national scale. In our latest I4CE paper, we examine the progress made across three value chains crucial for France’s green industrial base – batteries, green steel, and synthetic sustainable aviation fuels.  

Fortunately, policymakers can already point to good progress on the ground. From the gigafactories and the emerging “Vallée de la Batterie” in the north and Arcelor Mittal’s landmark €1.3bn investment in Dunkirk to Fos-sur-Mer in the south, new green industrial ecosystems are being built.  

Yet weaknesses in the supply chain could risk this momentum hitting a brick wall. Several projects across all three sectors are stalled, waiting for final investment decision. Investors, for their part, are hesitant to commit to risky, innovative projects in the face of higher productions costs and stiff competition from China and other global players.  

To keep this project on track, policymakers need to take another look at their toolbox, such as targeting public funds at supporting projects over the finish line and during their difficult first years of operation. Doing so is a matter of urgency. The plans are drawn, the groundwork laid – but unless financing catches up with ambition, the green industries of tomorrow will be built elsewhere. 

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L’article France has the blueprint for green reindustrialisation – but does it have the necessary tools ? est apparu en premier sur I4CE.

Many solutions exist to meet these objectives, but all require one essential component: planning, and in particular long-term investment planning. The forthcoming revision of the Governance Regulation of the Energy Union and Climate Action offers a unique opportunity to transform the National Energy and Climate Plans (NECPs) into genuine investment plans. These plans could enable Member States not only to address the current energy price crisis by accelerating the energy transition, but also to drive the modernisation and economic development of their countries. To achieve this, these plans must go beyond a tick-box compliance exercise and be backed by political ambition to reflect Member States’ strategic priorities. Their framework must also adapt to the investment strategies already in place within Member States.

In response to the European Commission’s consultation on the revision, I4CE outlines the key components of a climate and energy investment plan. We propose a toolkit to assist policymakers in designing these plans, from estimating climate investment needs, to defining public policies and spendings to close the investment gap, and accounting for macroeconomic implications. We also highlight critical success factors for implementation, including incentives linked to the EU budget, capacity building support, and the need for improved tracking of private investment data at the European level. 

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L’article Turning national and energy climate plans into investment plans est apparu en premier sur I4CE.

However, the debate in Europe is not trending in this direction.  Part of the industry, supported by some European leaders such as German Chancellor Merz, warns against a decline in competitiveness and calls for a weakening of the ETS and a cap on carbon prices, calling into question the future of this crucial mechanism.

As our Chairman Jean PISANI-FERRY and Executive Director Benoit LEGUET argue in Les Echos this week, taking a step back now would jeopardise Europe’s progress towards a decarbonised industrial base. I4CE’s Panorama of Climate Investments shows that, in France, an additional €4 billion in annual decarbonisation investment is required until 2030, which would be made harder if ambition is lowered.   

Indeed, the debate in Brussels and national capitals this year should focus on strengthening, not weakening the ETS. Revenues are crucial not only for supporting domestic investment in decarbonising industry today, but to supporting European mechanisms developing the climate innovation needed tomorrow, such as the EU Innovation Fund and the forthcoming Industrial Decarbonisation Bank. If we take a step back on the ETS, these important funds will suffer.

Above all, it is counterproductive to get bogged down in negotiations on a price cap. This would undermine the business model of decarbonised industry, compromise the credibility of Europe’s climate objectives, while jeopardising our climate leadership just as carbon pricing gains momentum globally.  

In the face of a new wave of backlash against the ETS, it is important to remember that chaos does not support competitiveness. Europe must remain firm, strengthening the ETS to build a world-leading, innovative green industrial base.  

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L’article Stay the course: why a stronger ETS is the key to industrial competitiveness  est apparu en premier sur I4CE.

One of the main areas of focus will be the issue of financing adaptation, with the first key challenge being to mainstream the concept of resilience by design into all European funding currently under discussion, including structural policies such as the Common Agricultural Policy and the Connecting Europe Facility.

But while we need to invest better, we also need to invest more – at European level and in each Member State – to ensure climate resilience, a key component of European security and the continent’s economy.

The question is how much and in what. The difficulty lies not in a lack of analysis but in the absence of clear decisions on adaptation choices at all levels of government. What level of risk are we prepared to accept? And above all, what responses do we want to prioritise: which activities are we seeking to maintain at all costs, and what are we prepared to transform? 

Our work in France has already shown that adopting a reference trajectory – currently being considered at European level – provides a solid basis for clarifying the question of the risk to be considered. The preferred responses must be the subject of policy dialogue on a sector-by-sector and region-by-region basis. It is a question of understanding dependencies and making coherent strategic choices in terms of planning, equipment, technologies and solidarity. 

Close monitoring of expenditure contributing to adaptation shows that preparing for a changing climate has many co-benefits: it also means testing new technologies, helping to ensure the sovereignty of essential sectors, strengthening the robustness of critical infrastructure, and making agricultural, tourism and industrial development bets that may prove successful.

A clear understanding of these collective gains and how they are distributed is essential for developing the economic models that will provide the necessary fundings to meet this challenge. We come to the same conclusion when we consider the conditions for financing adaptation in developing countries. This is a central subject of I4CE‘s work programme in France, Europe and internationally in 2026. 

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L’article Risk levels and priorities: financing climate adaptation requires clear decisions est apparu en premier sur I4CE.