Enabling investment for the transition to a low carbon economy: government policy to finance early stage green innovation

Owen, Robyn; Brennan, Geraldine; Lyon, Fergus

doi:10.1016/j.cosust.2018.03.004

Cited by 220 publications

(123 citation statements)

References 36 publications

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“…As aforementioned, the EP's proposal targets calibrating capital requirements as a way to mobilise capital to contribute to mitigating climate change. The need for mobilising both JFRC 27,3 private and public capital to facilitate the transition to a low-carbon economy and close the current investment gap is widely acknowledged and potential channels are being discussed in the literature (European Commission, 2018;OECD, 2017;Owen et al, 2018;Polzin, 2017;UNEP FI, 2009).…”

Section: Literature Reviewmentioning

confidence: 99%

Quantifying the potential impact of a green supporting factor or brown penalty on European banks and lending

Thomä

Gibhardt

2019

JFRC

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Purpose -The European Parliament and Commission are considering introducing a green supporting factor (GSF) or brown penalty (BP) for capital reserve requirements. This paper aims to estimate the potential impact such a policy intervention may have on both capital reserves of European banks and the cost and availability of capital to "green" and "brown" investments.Design/methodology/approach -The paper draws on the existing empirical and theoretical literature on the impacts of changes to capital reserve requirements on the real economy. It applies these estimates on the particular policy intervention currently being discussed at EU level to estimate the potential range of impacts on the cost of capitalmeasured in basis pointsand the availability of capitalmeasured in per cent changes to lending.Findings -A GSF would have a limited effect on overall capital requirements of banks compared to a BPgiven the larger universe of assets on which such a penalty would be applied. The estimated effect is a reduction in capital requirements associated with a GSF of around e3-4bn based on baseline "green" definitions. In terms of cost of capital, the paper estimates a reduction of 5 to 26 basis points for green projects (with inverse expected effects for a BP). In terms of availability of capital, analysing a BP suggests a potential reduction in lending to brown assets of up to 8 per cent.Originality/value -The paper provides direct evidence, with the first quantitative analysis of the potential impact of the current policy proposition discussed at EU-level.

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Section: Literature Reviewmentioning

confidence: 99%

Quantifying the potential impact of a green supporting factor or brown penalty on European banks and lending

Thomä

Gibhardt

2019

JFRC

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“…Directional distance function (DDF) and the globalmalmquist-luenberger (GML) productivity index to measure the green total factor productivity (GTFP) growth of china [62] 15 Investment for the transition to a low carbon economy through green economy Finance ecosystem approach for low carbon investment are connected at local, national and international scales, alongside support to build entrepreneurial skills and investment readiness [63] The listed publications in Table 2 show the verities of recent researches in environmental areas, such as renewable energy, green supply chain management, and low carbon economy. These publications are needed to develop an outline that covers commonly appropriate green economy frameworks based on indicators as GE's metric or metric value.…”

Section: Green Economy (Ge)mentioning

confidence: 99%

Aligning the Criteria of Green Economy (GE) and Sustainable Development Goals (SDGs) to Implement Sustainable Development

et al. 2019

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Global economic trends have shown the progression of social inequalities and environmental deterioration in the grey economy. New economic practices and policies need to be developed in order to achieve the sustainable development goals (SDGs). A green economy (GE) has a correlative role with the implementation of sustainable development (SD), which could revive the grey economy, human well-being, and social equity, as well as substantially decrease environmental risks and ecological scarcities. This study aims to develop a hybrid methodological and mathematical approach to prioritize the most effective variables from classified GE and SDGs criteria (23 criteria) to implement SD. This study has deliberated over the Decision making trial and evaluation laboratory (DEMATEL) technique for considering interconnections among numerous criteria to collect the most effective variables (12 criteria) based on three pillars (3Ps) of SD. Likewise, the analytic network process (ANP) technique ranked these effective variables by considering their network relations based on three indicators. Lastly, integration was used to finalize and prioritize the most effective variables based on their weight from the ANP technique. This study will highlight the green economy with exclusive environmental issues and sustainable growth as the greatest effective variables among GE and SDGs criteria for SD implementation.

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“…The particular deployment of a technology or deployment within a country are presented as case studies in some papers [49,124,125]. Four papers present different investment vehicles that may provide some of the solution to mobilising capital, including the use of equity indices [126], bonds [127], or the need for a better blending of public and private capital [128,129]. Taking a much more theoretical approach, solutions to emission externalities, knowledge spillovers, and capital market imperfections are also explored [130].…”

Section: Testing Barriers Through Implemented Solutionsmentioning

confidence: 99%

A Scoping Review of Barriers to Investment in Climate Change Solutions

2019

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The finance sector has engaged with policy development processes associated with climate solutions for well over a decade, with the aim of overcoming barriers to investment. In this paper we analyse 31 practice-based policy reports which highlight key barriers to such investing. We use those practice-based policy reports to identify themes associated with barriers to investment to conduct a scoping literature review of academic research. We identify 91 relevant papers and use content analysis to summarise the barriers identified in a structured way to help inform the research landscape in a timely manner. Given the urgency of this issue, we call on the academic community to focus more effort in this new and emerging discipline and, in particular, on the need for an independent view on the validity of some of the claims made in these practice-based policy reports.

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Enabling investment for the transition to a low carbon economy: government policy to finance early stage green innovation

Abstract: Enabling investment for the transition to a low carbon economy: government policy to finance early stage green innovation.Current Opinion in Environmental Sustainability, 31 . pp. 137-145.

Cited by 220 publications

References 36 publications

Quantifying the potential impact of a green supporting factor or brown penalty on European banks and lending

Quantifying the potential impact of a green supporting factor or brown penalty on European banks and lending

Aligning the Criteria of Green Economy (GE) and Sustainable Development Goals (SDGs) to Implement Sustainable Development

A Scoping Review of Barriers to Investment in Climate Change Solutions

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