Focus area

Sustainable Economy

Financing a green and just transition is one of the greatest challenges in the fight against climate change: decades of inaction and investments into fossil fuels leave us limited time to reach net-zero by 2050.

Solutions are complicated and encompass a range of tools and initiatives.

We seek to identify and push for a sustainable economy that enables and deploys low-carbon and renewable technologies & solutions. 

In short:

  • The flow of capital to projects and initiatives delivering real climate action must be increased.

  • To enable, deploy, and scale real climate solutions, support mechanisms need to be identified and an appropriate regulatory framework must be implemented.

  • Fair and competitive market conditions are needed for low-carbon and renewable technologies & solutions to thrive.

Economic systems still operate in a way that disproportionately favours fossil-based over renewable and low-carbon activities. Our work on a sustainable economy has its basis in observed failures of markets to deliver on their own in the fight against climate change.  

Public funding and support mechanisms are widely needed across a range of topics to help facilitate technological development, innovation and deployment of climate solutions. Private financing has an important role to play. It is also crucial that clear and credible classification mechanisms, and transparent information on economic activities’ contribution to real climate action, are made available. This will foster an increased flow of private and public capital to the right projects in the fight to tackle climate change. 

Uncertainties and risks are the main barriers standing in the way of long-term development of low-carbon and renewable markets. Ensuring a predictable and harmonised regulatory framework across Europe has been a building block in our work to foster such developments since our founding. This is particularly important in the context of ensuring fair and competitive markets taking into account the need and value of real climate action. 

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Lead Markets 101

The fundamental step of creating green lead markets is to generate a comprehensive CO2-footprint of a good or service in order to identify what is ‘green’ and which products should be pulled to the market. To ensure alignment with carbon neutrality goals, such a system needs to account for the whole lifecycle carbon of a product and include both the ‘operational carbon’, so the CO2 emitted during the use of a product, and the ‘embodied carbon’. The latter refers to the CO2 from input materials and processes going into a product, as well as the emissions resulting from products’ refurbishment and end-of-life treatment. 

The people involved

Lina Strandvåg Nagell

Senior Manager Projects & EU Policy

Hanna Biro

Policy Advisor

Francesco Lombardi Stocchetti

Policy Advisor, Sustainable Finance & Economy

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