Turning national and energy climate plans into investment plans
European leaders gathered last week for a European Summit, with the objective, among others, of finding solutions to rising energy prices in the wake of the Middle East conflict. Faced with recent spikes in the cost of imported fossil fuels, the European Council reaffirmed that “the energy transition remains the most effective strategy for achieving Europe’s strategic autonomy, strengthening resilience, structurally lowering energy prices, and delivering the clean, abundant and homegrown energy needed to power the economy of the future.”
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.
