Publications

Industry: relocation and decarbonisation at the heart of the debate. The recent succession of crises (health, energy, geopolitical) and increased international competition have prompted France to look for ways to strengthen its industrial and energy sovereignty. It faces this challenge in addition to the challenge of decarbonising its industry. In this context, France and Europe are developing industrial policies with two objectives – relocation and decarbonisation – and with new tools such as the France 2030 plan and the Net Zero Industry Act at the European level. These policies target both ‘historical’ industries, such as steel and cement, and new clean technologies, from solar to batteries.

Since their introduction, climate stress tests have taken a lot of space in the public debate. Put in the spotlight by supervisors and the NGFS, their primary objective is to encourage banks to integrate climate-related risks into their activities and to carry out an initial assessment of the banks' capacity to deal with these risks.

This report co-written with NewClimate provides practical guidance for international financial institutions to support financial institutions’ alignment with the Paris Agreement goals, and to more broadly contribute to transforming local financial systems. This guidance is developed around three pillars: a harmonised alignment assessment; the alignment of financial intermediaries; and the alignment of financial systems at the national level.

For years, the European Union assumed it would lead the cleantech race because it was the only one running in it. Mistakenly so. With the Inflation Reduction Act, the US quickly catches up. This brief argues that the best EU policy answer to the IRA is an EU long‑term climate investment plan. As the political appetite for such a plan is currently limited, the European Commission should use the political momentum to propose a targeted investment plan that focuses on the development, scale-up, manufacturing and deployment of clean technologies in the EU. It identifies three first bricks that can already be laid out to build this plan.

Private finance will not fund the transition without a stronger commitment from public authorities. For several years, and particularly since COP 26, considerable time and attention has been dedicated to the subject of voluntary commitments from private financial actors. These commitments, made within the framework of international initiatives, should in principle enable private finance to be mobilized for the transition to a carbon neutral economy.

2022, France is paying dearly for a dependence on fossil fuels maintained by a chronic lack of investment in the decarbonisation of the economy. This edition of the Landscape of climate finance in France makes a detailed analysis of these critical expenditures by households, companies and public authorities, in the retrofitting of buildings, the purchase of electric vehicles, and renewable energies, as well as in rail, cycling and urban public transport infrastructures. Encouragingly, climate investments have increased significantly in the past year, driven, among other factors, by favourable regulations and by state support under the recovery plan. But this growth remains fragile, and analysis of several transition scenarios shows that climate investments need to increase further in order to stay on track to carbon neutrality and to ensure a lasting reduction in France’s dependence on fossil fuels.

The European Union has made rapid progress on the issue of transition plans for companies and banks. First of all, the CSRD directive obliges each listed company to publish its plan for achieving carbon neutrality by 2050. Published by EFRAG this summer, the standards set for these plans can be considered ambitious and commensurate with the challenges they face. With regards to banks, it is now clear that they will be required to publish their transition plan. What remains under debate is whether these transition plans should be integrated into prudential regulations, which would open the way to numerous possibilities of action and sanctions by supervisors.

Long term national climate strategies, such as Long-Term Strategies (LTS) published to the UNFCCC, are key documents developed by governments to envision the transition to a low-carbon and climate resilient economy at the 2050 (or later) time-horizon. As of the beginning of COP 27 in Sharm-el-Sheikh, Egypt, on November 2022, 55 countries had submitted an LTS to the UNFCCC, answering renewed calls for countries to develop such strategies at COP 26. It is expected that additional LTS will be published shortly. 

This study is a contribution to the French public debate. It aims at supporting the acceleration and concretization of climate change adaptation initiatives in this country. The study reviews 11 adaptation challenges such as the strengthening of civil protection, the reshaping of coastal areas or the protection of water resources. For each challenge, the study presents national budgetary decisions ready to make in the next Finance Bill that would complement existing actions and cost elements to feed the required arbitrations yet to be made.  

Local authorities have a major role to play in achieving France’s 2050 carbon neutrality objectives, as set out in the National Low-Carbon Strategy (Stratégie Nationale Bas Carbone, SNBC). Due to their assets and areas of expertise, local authorities must make numerous climate investments, implement strategies and action plans, and take measures to encourage stakeholders within their territories. This study aims to estimate the cost of such climate action for local authorities. 

Carbon revenues were nearly USD 100 billion in 2021. This represents a more than 80% increase year-on-year (USD 53.1 billion in 2020, USD 97.7 billion in 2021). This increase is largely driven by the rise in allowance prices on the European carbon market, which exceeded the symbolic threshold of EUR 100/tCO2 for the first time in the summer of 2022.

To achieve the climate goals of the UE, The European Commission wants to create a carbon certification framework to encourage carbon storage in the land sector. The challenge is to develop a common and harmonised framework at the European level by better relying on the expertise acquired through existing certification frameworks. With this study, I4CE propose 7 recommendations, inspired by both our concrete experience with the French Label Bas-Carbone to which we have contributed, and by 15 years of research on carbon certification.

This I4CE report focuses on the role of countries’ Long-Term Strategies (LTSs) in the Paris alignment approaches of Development Finance Institutions (DFIs). It explores the possible roles of both the LTS development process and the resulting LTS document in providing insights on the Paris alignment of investments within investment decision-making processes. The findings are relevant for a broader range of financial institutions.

The restructuring of the economy towards a low-carbon system will lead to develop activities that are aligned with the needs of a net zero economy, to restructure others in order to make them compatible with these needs and to stop harmful activities. The financial sector needs to anticipate these dynamics to address strategic risks and […]

The transition plans aim to establish a progressive decarbonisation strategy by 2050, in line with the European Union’s objectives. The European Central Bank, through Frank Elderson, as well as several NGOs are calling for transition plans to be made mandatory for banks and to be integrated into prudential regulation. This note first looks at why […]

In order to reach the objectives of the recently approved EU Climate Law, the agricultural sector has to simultaneously reduce significantly its level of emission, increase the amount of carbon it sequesters, and augment the production of biomass in substitution of fossil fuel – which are to be phased out in the short term. In […]

A steep rise in investment in low-carbon vehicles and sustained climate investment in other sectors, a fall in the financing of fossil fuels, a climate funding deficit of over 13 billion that recovery measures are unlikely to offset...

In order to understand what public financial institutions can do, I4CE and Ramboll have analyzed 5 territorial projects, from the Vosges to the Dordogne, which are trying to meet the challenge of adaptation. Beyond their differences, each of the cases studied shows that adaptation requires, above all, dedicating time and resources to change the way projects are designed and carried out.

In this study, I4CE reviews the characteristics and areas of intervention of public financial institutions, which make them essential actors for adaptation. The study also reviews all of the Public Financial Institutions' business lines to determine their levers for action.

In the context of the development of the Low Carbon Label, one of the recurring questions from potential financiers is: "What am I allowed to say and do when financing certified low carbon projects? With this publication, I4CE provides operational and pragmatic answers.