Published on Monday, April 1, 2024

Spain | Funding for the energy transition

With investments in green technologies, the involvement of financial institutions, public-private partnerships, efficient and well-designed public policies, and a sound and coherent regulatory framework that provides certainty, we can move toward a more sustainable and prosperous future.

Key points

  • Key points:
  • To do so, we need to redirect a huge volume of our investments to adapt our economies to the scenario of zero net emissions in 2050.
  • Decarbonization demands massive investments in the coming decades, implying an accelerated transformation in the productive capital of the economy. It is estimated that decarbonization alone will require the redirection 8% of global GDP annually until 2050 to investments needed for the energy transition.
  • Two conditions are necessary for the economy to be able to mobilize this huge amount of investment. Firstly, the energy transition must be profitable and economically viable, i.e., the return on these investments must be positive in order to generate a demand for them.
  • The second condition is to make it easier for financial institutions to channel all the financing needed for the investments required for decarbonization and adaptation to climate change, at the lowest possible financial cost.
  • The initiative in Spain to convert temporary levies on the energy and banking sectors into permanent taxes goes in the opposite direction to that needed for the energy transition.

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