Two Perspectives on the EIB Investment Report 2019/2020

Short list of findings:

  • Economic climate in the EU is worsening and investment by EU firms is likely to slow down in 2020
  • EU climate mitigation investment stagnating and behind US and China
  • Europe needs to accelerate adoption of digital technologies to stay competitive

European firms are becoming increasingly pessimistic about the economic outlook according to the new EIB Investment Report 2019/2020. The report also finds that investment in climate change mitigation is lower than that of major economies like the US and China. Infrastructure investment is stuck at 1.6% of EU GDP, the lowest in 15 years and Europe is failing to reap the benefits of digital transformation.

Original article entitled EIB Investment Report 2019: Uncertainty Weighing on EU Firm Investment; Published by EIB here on 26 November 2019

The report, which reflects the results of the annual EIB Investment Survey (EIBIS) of 12,500 European businesses, recommends that the EU take advantage of historically low interest rates, increase public investment, catalyse private investment and promote efficient financial intermediation to tackle the slowdown.

“Europe cannot afford to wait out another cyclical downturn. After a lost decade of weak investment, we need to tackle the slowdown now if we are to respond to the historic challenges we are facing. The EIB, as the EU’s financial arm and climate bank, has played a crucial role in kick-starting investment in Europe after the financial crisis and we now stand ready to further support investment for a more sustainable and competitive European economy.”

Commenting on the report’s findings, EIB Vice-President Andrew McDowell 

Read the executive summary

Read the country-level analyses

The report was presented at the EIB’s Annual Economic Conference, which is jointly organised with the OECD, Columbia University and SUERF, in Luxembourg. The conference brought together high-level speakers such Sir Nicholas Stern and Mariana Mazzucato and chief economists of the European Central Bank, European Stability Mechanism, OECD, European Bank for Reconstruction and Development and the World Trade Organisation.

“We have to accelerate investment to fully exploit the benefits of the digital revolution, realise our climate goals and rebuild Europe’s social cohesion. There is a long list of investments that require public intervention or a private sector that finds the right conditions to overcome uncertainty: firms’ digitalisation, innovation and business dynamism as well as smart delivery of infrastructure and public services, green innovation and energy efficiency, and e-government, e-learning and e-training.”  

According to Deborah Revoltella, Director of the EIB’s Economic Department, while presenting the report. [ . . . ]

EU climate investment not on track

The EIB Investment Report shows that, although substantial progress has been made, climate action investment in the EU is not yet on track. To achieve a net zero-carbon economy by 2050, the EU must raise total investment in its energy system and related infrastructure from 2% to 3% of GDP on average.

The European Union invested EUR 158 billion in climate change mitigation in 2018. At 1.2% of GDP, this is now marginally less than the United States (1.3%) and little over a third of China’s performance (3.3% of GDP).

While the United States leads in climate-related R&D spending, China has recently quadrupled its spending, overtaking the EU.

Europe’s weak performance in climate-related R&D is a threat to its competitiveness, given the importance that still-immature technologies will have in the transition.

To continue reading the original article, link here.

Another Perspective from ClientEarth foundation to the EIB 2019/2020 Report

Response to this report per the official News release from ClientEarth.org of 13 November 2019, entitled Major Step Forward: European Investment Bank to Stop Funding Fossil Fuel Projects, original publication here

ClientEarth welcomes the European Investment Bank’s landmark lending policy and the Board’s decision to exclude gas finance from it.

“The EIB has set the standard for banks worldwide with this move – and clearly signalled that oil, gas and  coal lending is inconsistent with the Paris Agreement goals. This is a major step in the flight of capital from fossil fuels. While we are disappointed to have seen such strong initial pushback from countries like Germany, which claims high standards on climate, the passing of this policy shows a change of gear for clean investment.”

ClientEarth lawyer Peter Barnett

Although the policy will kick in at the end of 2021, a year later than previously proposed, ClientEarth lawyers have warned that any decision to fund new gas or other fossil fuel projects before then would not be in line with the Paris Agreement and will risk legal challenge.

For further reading the original article by ClientEarth.org: link here.

Four in Five EU Coal Plants Unprofitable — Carbon Tracker Initiative October 2019 Report

LONDON – Four in five EU coal power plants are unprofitable and utilities could lose €6.6 billion this year alone, finds a new report from financial think tank Carbon Tracker.

Originally published 24 October 2019 here; contact information below at end of post.

Coal plant
The majority of coal plants in the European Union (EU) could face losses of nearly €6.6 billion
this year, according to the Carbon Tracker Initiative report.

Read moreThe eco-warriors of climate protection

It warns investors and policymakers to prepare for a complete phase-out of coal by 2030, because without heavy subsidies the industry will not survive sustained competition from ever lower cost wind and solar power and temporarily cheap gas.

Governments will face “intractable problems” if they seek to support coal in the long-term because they will have to choose whether to: pass costs to the utilities and destroy shareholder value; pass costs to consumers and push bills up; or fund them from debt or taxes.

Matt Gray, Head of Power & Utilities at Carbon Tracker and co-author of the report, said:

“EU coal generators are haemorrhaging cash because they cannot compete with ever-cheaper renewables and gas and this will only get worse. Policymakers and investors should prepare to phase out coal by 2030 at the latest.”

Carbon Tracker used asset-level financial models to analyse the operating economics of every coal plant in the EU and the losses they face in 2019. It found that:

  • Germany’s lignite and hard coal plants could lose €9 billion, yet the country’s coal commission has only recommended a 2038 deadline for phasing out coal.
  • Spain and the Czech Republic, which have yet to set a phase-out date, face losses of €992 million and €899 million respectively. In the UK, which has set a 2025 deadline, its remaining coal plants will lose €732 million.
  • Germany’s RWE is the utility facing the greatest losses – it could haemorrhage €975 million, 6% of its market capitalisation. EPH, with assets mainly in Germany and the Czech Republic, could lose €613 million, and PPC, in Greece, could lose €596 million.

This year EU hard coal generation has fallen 39% since 2018, resulting in “eye-wateringly low utilisation rates” while lignite generation is down 20%. Carbon Tracker calculates that overall 84% of lignite generation and 76% of hard coal generation is unprofitable, facing 2019 losses of €3.54 billion and €3.03 billion respectively. Across the EU 79% of coal plants are running at a loss.

For further reading, link to original article here.

To arrange interviews please contact:

Joel Benjamin            jbenjamin@carbontracker.org             +447429 637423

David Mason             david.mason@greenhousepr.co.uk      +44 7799 072320

About Carbon Tracker

The Carbon Tracker Initiative is a not-for-profit financial think tank that seeks to promote a climate-secure global energy market by aligning capital markets with climate reality.

Their research to date on the carbon bubble unburnable carbon and stranded assets has begun a new debate on how to align the financial system with the energy transition to a low carbon future. www.carbontracker.org

META: 5 GREEN IDEAS FOR THE EU IN NEXT 5 YEARS

MARIE-AMÉLIE BRUN, Published JUNE 6, 2019, original article here

Picture credit: Frank Hui, flickr.com

CLIMATE ENVIRONMENTAL JUSTICE EUROPE PROTECTS FEATURED PODCASTS RULE OF LAW SUSTAINABLE DEVELOPMENT

After the European elections, META has great ideas to help new MEPs and potential Commissioners with five green ideas that could blossom in the next five years.

A short synopsis of the options offered:

1. A European Green New Deal

The European Union needs to get the ball rolling on a new environmental action programme – or European ‘Green New Deal’.

2. New European Commission Vice-Presidents for…

The European Commission plays a crucial role in the lawmaking process of the European Union. Various Vice-President positions already exist in the Commission, but the Environment and Climate roles are not yet represented at this level.

3. A Sustainable Development Goals strategy

17 Goals have been developed by the United Nations to achieve a sustainable future for all. These goals, called the ‘Sustainable Development Goals’ – or ‘SDGs’ – target all aspects of sustainability, from poverty to clean oceans.

4. Net zero emissions

At the end of last year the European Commission presented a strategic long-term vision of achieving a climate-neutral economy by 2050. Last month eight EU countries called for net-zero carbon emissions by 2050.

5. A ‘Paris moment’ for Biodiversity

A study carried out by the world’s top nature scientists and representatives from 132 governments warned us recently that humanity faces a global environmental emergency.

The three-year assessment into the health of our planet’s ecosystems reveals the alarming extent of global biodiversity breakdown with up to one million species set to disappear within a few decades.

Marie-Amélie Brun sums it up in her article: 5 Green Ideas for the EU in the Next Five Years

For further reading: www.meta.eeb.org

A Blog Looking Back at the Cooperation of The Crowd and the Bees

25 March 2019

By Andrea Carta, Greenpeace EU Senior Legal Strategist

My collaboration with “The Crowd Versus” began in September 2016. At that time, I was providing EU law expertise to Greenpeace International, who had intervened in a case that Bayer and Syngenta had started against the EU Commission: the two agrochemical companies were trying to annul a regulation that prohibited the use of three active substances for pesticides (neonicotinoids), which the Commission found to be harmful for bees. 

Together with other NGOs engaging in the protection of bees and pollinators (Bee-Life.eu, Bugslife.org, and Pesticides Action Network-Europe), we decided to intervene in the proceedings in support of the Commission’s ban.

The Crowd Versus made their platform available for a fundraising campaign, to help us pay the costs of the court intervention and to provide communication opportunities around the case. 

Getting the fundraising campaign started was a relatively easy process. The Crowd Versus uses a simple and transparent standard agreement and it provides the parties with all the basic information to develop the crowdfunding page. At the design stage, requests for input on Greenpeace’s side were minimal, and limited to a short description of the legal case and to some pictures. 

The Crowd Versus produced a dedicated webpage and a video. It also took care of the launch of the crowdfunding via social media like Facebook and Twitter. Communication was regular and all the adjustments that proved necessary (text, timeline and target) were made practically in real time. 

On 29 September 2016 we were online and the campaign ended on 15 February 2017 with € 1.680 and 85 individual donors, most of which from the Netherlands, where The Crowd Versus is based.

Considering that we were practically running a pilot, and that The Crowd Versus was mainly counting on its own audience, I think the result of this short campaign was encouraging, even if it did not reach the target that we had initially set. 

What could have we done differently to achieve the target?

Based on my experience with the bees’ case, I think that, beyond a thorough preparation, communication is the factor that can determine the success of a crowdfunding campaign. Here are my two advices:

Communicate frequently and widely around the case

This should be easier for grassroots organisations, whose main focus is on one legal cases (or a small number of them), than for large organisations like Greenpeace, who have many campaigns and initiatives running at the same time. 

Find a way to make (administrative) law appealing

Administrative law is already boring for law students. Don’t expect it to be entertaining for the public unless you put some serious work on it!

Beyond a doubt, our case was important from both the legal and the environmental perspective. However, mobilising supporters was very difficult, given that cases before the EU Court of Justice are very slow, very technical and very quiet. 

With a well-designed and planned communication strategy, a crowdfunding campaign can bring, in addition to the monies that are necessary to run a legal case, a valuable opportunity to mobilise around it and turn a lawsuit into a real campaign.

BIO

Andrea Carta works as Senior Legal Strategist for the European Unit of Greenpeace, where he advices on a broad range of EU environmental law issues, including pesticides, GMOs, energy, access to justice, illegal timber imports and trade policy.