LATVIEŠU | ENGLISH

Climate investment capacity (CIC2030): Climate finance dynamics & structure for financing the 2030 targets

The Regulation on the Energy Union Governance requires the EU Member States to design integrated national energy and climate plans to ensure the EU’s 2030 energy and climate targets are achieved. The implementation of these plans demands the mobilization of significant capital by 2030.

Czechia and Latvia introduced a package of financial incentives and fiscal policies; their impact is not yet enough to achieve the targets. Know-how on structuring viable projects and experience with significant private capital mobilization are limited and the countries need new knowledge and capacity to raise it.

Germany has been a frontrunner in terms of decarbonizing its energy portfolio. Due to dynamic policy development and investment support, Germany is on track to achieve the renewable electricity target. Some studies suggest though that to achieve other energy and climate targets, the country needs to apply more efforts.

CIC2030 aims to address that challenge and build new capacity. The starting point is already existing knowledge and know-how in Germany which the project will update and then transfer and adapt to national circumstances in Czechia and Latvia with help of implementing partners.

The central outcome are the skills of the public and financial sector to address the investment challenge in the focus countries. Building on a learning-by-doing approach, CIC2030 will produce:

1. analyses of investment need to reach the 2030 climate and energy targets,

2. investment maps to track public finance and private investment flows into climate and energy transition actions, and

3. capital raising plans to close the gap between the need and the current investment flows.

CIC2030 will co-design these products with national target groups thereby addressing their needs and incorporating their data and knowledge so that they could co-own and imbed the products into their decision-making.  These actors will therefore be able to better detect necessary low-carbon investment opportunities and support them, contributing to successful completion of the national plans. They will be able to inform the EU policy discourse about their transparency towards the implementation of the EU Energy and Climate Package 2030, international climate commitments e.g. EU “National Determined Contributions” under the Paris Agreement, as well as spending EU and national public budgets on climate-related action. This could inspire the EU level and other EU member states’ decisions on promoting sustainable finance.

PROJECT FUNDED BY:

The European Climate Initiative (EUKI):

PROJECT DURATION:

From September 2018 until December 2020

PROJECT BUDGET:

60 960 EUR

SCIENTIFIC LEADER OF THE PROJECT:

Agris Kamenders

PUBLISHED:

04.12.2018.

MORE INFORMATION:

PROJECT PARTNERS:

From Latvia:
Riga Technical University

From other countries:
Institute for Climate Protection, Energy and Mobility (IKEM), Germany
Czech Technical University in Prague (CVUT), Czech Republic

NEWS

Within the framework of the CIC 2030 project, a conference “Is it Time for Changes in the Latvian Energy Sector?” is organized with other project partners, where during the 1st session, scientists from the UL, RTU, Germany and France will share their experience in discussing and discussing modeling approaches that help determine the amount of investment needed in the energy and climate sector. Program and registration here.

Representatives of the CIC 2030 project participate in the forum “Energy and Climate Plan 2030 – Towards a Sustainable Country” organized by the Ministry of Economics at the energy and climate project contact exchange (event will take place on November 21 at H2O 6 block, Durbes Street 4, Riga).

Kick-off meetings in Germany served as a first refinement of the project scope, work plan and methodological approaches that could be applied to the project’s main results in the interest of stakeholders such as the German Federal Ministry of Economic Affairs and Energy (BMWi) and German Federal Ministry of the Environment, Nature Conservation and Nuclear Safety (BMU).

DELIVERABLES

We have developed a climate investment flow chart that allows you to track investment flows in energy efficiency and renewable energy projects in Latvia in 2018. In this report, our aim was to look at how projects have been funded, who have been the biggest investors, how much and in what sectors Latvia has invested in 2018.

Analysing the investments made, it is estimated that in 2018 at least EUR 190 million was invested in energy efficiency measures for buildings and companies, while EUR 41 million was invested in RES (including EUR 21.1 million in Daugava HPS).

Currently, EU funds play a major role in financing climate projects. Currently, EU funds are mainly used in the form of grants to invest in state and municipal building renovation projects. Given the high share of grants in project financing, private investment in 2018 was relatively small, accounting for 29% of total investment, while EU funds accounted for 42%, state and local government funding for 29%, including quota trading revenues.

The report consists of four chapters. The second chapter followed by introduction, which deals with the research methodology. The third chapter describes the results obtained. The conclusions and the discussion section summarize the main conclusions and recommendations for future work on climate investment assessment. The Annexes provide details on the data sources, assumptions and references used in this report.

Kamenders A., Rochas C., Novikova. A., “Investīcijas energoefektivitātes un atjaunīgo energoresursu projektos Latvijā 2018. gadā”, Riga Technical University (RTU), November 2019.

On the 27th of November the 1st parallel session of RTU conference “Is it Time for Transformations in the Latvian Energy Sector?” was dedicated to the activities of the project “Climate investment capacity 2030”. During the conference, there was an opportunity to learn about and discuss the experiences and approaches of Latvia, France and Germany in assessing investment in meeting the 2030 energy and climate targets.

The conference sought answers to the following questions:
->How can modeling and developed models help to make better decisions?
->What are the modeling capabilities and limitations?
->How can we estimate the amount of investment needed to meet the 2030 climate and energy targets?

Presentations for Session 1 Climate Investment Capacity 2030:

  1. Modeling Approaches to Assessing the Effectiveness of Energy Policy for Meeting the 2030 Goals, Andra Blumberga, RTU; PRESENTATION
  2. Modeling Approach to Assessing Climate Investment in France, Hadrien Hainaut, I4CE (ENG); PRESENTATION
  3. Investment Needs Assessment for Energy and Climate Goals in Germany, David Rusnok, IKEM (ENG); PRESENTATION.

This CIC2030 project is part of the European Climate Initiative (EUKI – www.euki.de). EUKI is a project financing instrument of the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety. The main objective of the EUKI is to promote EU climate cooperation and to reduce greenhouse gas emissions.

The partners IKEM of our research project CIC2030, has published the first results of their investment in climate and energy projects in Germany. The largest investments were made in energy efficiency projects in buildings, followed by the energy production and transmission sector. Interestingly, the bulk of investment (83% of total investment) comes from private business and household investment. You can find more information in the research.

Climate and energy investment map in Germany. Status report 2016