Global | How much needs to be invested in climate change? It depends

Summary

Climate investment needs depend on both the definition of what is needed and the reference scenario for climate change. All in all, for keeping “net zero” within the realm of possibility there is a funding gap to close by both public and, mainly, private sources. Appropriate incentives for private funding are key.

Key points

• Key points:
• Estimates of how much needs to be invested in climate change are as diverse as the scope of investments (for example, which productive activities, whether end uses are included) as well as their objective: “net zero” emissions, green transition, ... it's not the same, and it determines the results.
• In any case, climate ambition must be increased, resulting in a financing gap that must be covered by the public sector and, above all, the private sector.
• In the European Union, the new fiscal governance would be more favorable than previous framework, but much more is needed: Single Market deepening, streamlining administrative burden, targeted funding.

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