New publication: Investment needs for the local energy transition

The locally-driven energy transition is essential to achieve the Paris Agreement’s objectives by 2050. This report is showcasing five examples of European cities, that are frontrunners in the local energy transition and which have put a number on their investment needs by 2050, in order to succeed in their transition and undertake ambitious, Paris-proof energy and climate action.

Enabling local authorities to deliver on their ambitions

Responsible for 80% of energy use and CO² emissions, local governments know that they need to invest for a sustainable future on a liveable and healthy planet. But in order to thrive and play their key role to the fullest in achieving the Paris Agreement’s objectives, local authorities require access to sufficient funding and investment to deliver on their ambitious long-term energy and climate plans. In this new publication, case studies of five European cities – Ghent, Frederikshavn, Bordeaux-Métropole, Sevilla and Tallinn – all Covenant of Mayors signatories, provide the answer to what are the local investment needs for the energy transition.

This comes at a critical time: The European Commission has recently published its assessment of progress on structural reforms in 2019 and its in-depth macroeconomic review for the EU Member States (country reports), and linked it for the first time with investment recommendations for the next European Structural and Investment Funds (ESIF) programming period for 2021-2027. The 5 new priority objectives of ESIF are: Smarter Europe, Greener Europe, Connected Europe, Social Europe and Europe closer to its citizens. However, the EU Commission has not estimated in its recommendations what amounts the Member States would need to meet these objectives, and what investments they should provide to local authorities under the next ESIF program.

Our new publication not only illustrates the investment needs of these European cities for their energy transition, which range between EUR 750 million to 3 billion, but also provide guidance on where these investments are needed at local level. Through this undertaking, Energy Cities aims to steer EU and national funds in the next ESIF in the right direction, in order to meet concrete and tangible local investment needs for the transition – not only in these cities, but across all European cities taking action to fulfill the objectives of the Paris Agreement.

Five cities investing for the future

Ghent
The city of Ghent in Belgium is implementing inclusive energy policies to allow everyone to have access to cleaner energy and innovative technologies. Its flagship project “Neighbourhood Power” (Buurzame Strom) supports the installation of solar panels in a low-income district. In order to deliver its energy transition to a carbon neutral city by 2050, the investment needs are estimated at EUR 750 million for Ghent.

Frederikshavn
The city of Frederikshavn in Denmark has the ambitious objective to achieve 100% renewable energy by 2030. Frederikshavn would need EUR 1 billion to achieve this target. The main challenge for Frederikshavn is to encourage all citizens and private actors to join in the transition. The city has opted to lead by example through ambitious building retrofit and sustainable mobility actions.

Bordeaux-Métropole
In France, the city of Bordeaux-Métropole is paving the way for the energy transition by seeking to become an energy-plus metropole by 2050 through, in particular, the collaboration between its urban and rural areas. In the period 2017-2022, investments are planned worth EUR 535 million, which if maintained, would result in investment needs of EUR 2.7 billion by 2050. The city focuses on acting as coordinator and facilitator by supporting successful projects, such as the project of its flagship industrial cluster, the ecoparc of Blanquefort.

Sevilla
The Spanish city of Sevilla is also leading an ambitious energy transition to become a role model for sustainable mobility. The city has planned to invest EUR 264 million for the period 2012-2020, and would need up to EUR 1 billion by 2050. Sevilla is focusing in particular on sustainable mobility in its energy transition, by establishing notably a large cycling network and pedestrian zones to reduce air pollution and incentivize citizens to move away from using their cars to commute.

Tallinn
Finally, the example of the Estonian capital of Tallinn highlights how the heating and cooling sector also plays a critical role in the long-term investments for the energy transition. Tallinn is currently mobilizing some EUR 300 million in energy and climate actions, and is aspiring to become one of the first low-carbon cities in Eastern Europe with its ambitions on smart buildings and smart mobility. The city has estimated its investment needs at EUR 900 million by 2050.