Italy's climate plan lacks financial strategy, think-tank warns - Reuters
Italy's climate plan lacks financial strategy, think-tank warns | Reuters
Italy's climate plan lacks financial strategy, think-tank warns
[1/2]A solar power plant is seen past wind turbines in Canino, central Italy, April 27, 2016. REUTERS/Max Rossi/File Photo
MILAN, July 21 (Reuters) - Italy needs to invest 118 billion euros ($131 billion) annually to decarbonise its economy but lacks the financial strategy to attract funds from private investors and to allocate money to specific measures, climate change think-tank ECCO said.
In its energy and climate plan sent to Brussels this week, the government forecast total investments worth 830 billion euros in the period 2023-2030 to help phase out fossil fuels, increase the use of renewable energy and cut carbon emissions.
"The document lacks details on how much money will come from the state coffers, how to draw private investments and which incentives and tax breaks could be used," ECCO said in a report.
Italy needs a strategy to mobilise substantial private financial resources to accompany public funds made available by the European Commission through its Recovery and Resilience Facility (RFF) and REPowerEU schemes, the Rome-based think-tank said.
Italy is due to receive 191.5 billion euros in grants and cheap loans through 2026 from the EU's RRF in what is seen as a once-in-a-generation opportunity to revitalise a sluggish economy.
However, bureaucratic incompetence and a lack of expertise at managing such projects are making it increasingly difficult for the country to make use of the EU funds on time.
ECCO also called on the government to be more ambitious in the roll-out of renewable energy sources, in the phase out of natural gas and coal and in shifting to electric cars.
The energy ministry, which recently defended the plan against criticism over its emissions target, declined to comment on ECCO's report.
Italy will now hold talks with the European Commission on the plan aimed at reaching a binding version by June 2024.
($1 = 0.8988 euros)
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Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
- Catastrophic weather events — hurricanes, floods, droughts, high temperatures — are more frequent and more extreme. The cost can be measured in both the initial damage caused and the longer-term impact on the economy.
- Vulnerable communities are increasing climate-related investments, hardening infrastructure and taking other protective measures.
- Investment in carbon capture and storage technologies is increasingly rapidly.
- Governments are making investments and crafting regulations to reduce emissions of carbon dioxide and other greenhouse gases.
On top of all of this is the cost of uncertainty. As the Fourth National Climate Assessment, released in 2018 by the U.S. Global Change Research Program, says, “The assumption that current and future climate conditions will resemble the recent past is no longer valid.”