Europe invests in green technologies despite the corona crisis
Europe is committed to be the first climate-neutral continent in the world and to reach this goal, the European Commission has published an extensive climate program known as the European Green Deal. The aim of this program is to update the central legislation and channel thousand billion euro as guarantees, loans and public venture capital into green technologies, sustainable solutions and new businesses. At best, this roadmap takes European industries as the forerunners in the quest for a greener world.
What does Green Deal entail and what can it bring to companies developing green technologies?
We talked to Pekka Koponen, Chairman and founder of Spinverse, who tells us more what it is all about.
Green Deal is the new growth strategy of Europe. It aims at decreasing emissions and at the same time, at creating new jobs. Its goal is both to rejuvenate EU policies and direct current and new investments to secure sustainable development. In January 2020, the European Commission presented two plans to complement the European Green Deal; the European Green Deal Investment Plan and the supporting Just Transition Fund.
Carbon-neutral Europe by 2050
Public funding and regulation taking place during industrial transition play an important role in the current situation where environment, climate and people are facing increasingly tangible global threats. To solve these challenges threatening our environment calls for innovative solutions and companies developing them. In the future, more financial support than ever before has been mobilised to be applied by eligible companies.
The goal of the Green Deal is to make our continent climate-neutral by 2050. Green Deal aims at protecting our environment, creating new jobs and ensuring just transition by supporting countries and companies most affected by the economic consequences of this transition. As part of this strategy, EC encourages industries for clean circular economy, to develop energy efficiency of buildings and building industry, to accelerate the transition to sustainable and smart mobility and to develop the food industry value chain from “farm to fork.”
Challenging goals of green growth
Despite the commitment of EU countries in becoming become carbon-neutral by 2050, the road to greener continent is likely to have its pitfalls. Green Deal is a massive program whose goals have been challenged by member countries already before the coronavirus outbreak. The issues to be discussed by the member countries’ governments are related to carbon border taxes, extension of emissions trading, emissions levels for cars and LULUCF regulation for land-use and forestry and energy taxation.
EC wants to tighten the preliminary 2030 emission reduction target already now and at the same time, will unlock massive amounts of funds for the project. The processing is currently slowed down by the operative difficulties brought by quarantines, opposing views from carbon-dependent East European countries and the prevailing confusion regarding the money available over the period of 2021-2027.
However, the general sentiment towards Green Deal seems positive. The climate change is progressing regardless and public support packages to prevent crisis are quite similar in many regions as those planned under the Green Deal strategy.
Pekka Koponen is confident that EU will increase funding directed to our region and foresees new decisions for more funding in the course of this year already.
Companies need bold business plans
The EC goals are ambitious, to say the least, and they cannot be reached without significant investments in innovations.
The companies planning for investments or innovations applying to the strategy of the European Green Deal should take action and the company boards should take this as part of their strategy process.
Companies need bold business plans where innovations supporting the Green Deal are being developed. The search for suitable funding opportunities is part of the R&D process and there will be plenty of funding unlocked for those companies whose operations and products are in line with the goals of the Green Deal.
Available funding instruments to support the goals of Green Deal
There is a wide array of funding instruments to be mobilised by various EU institutions. To progress the goal for a greener Europe, billions of euros can be applied from the Innovation Fund, Just Transition Fund, Horizon Europe, Invest EU and European Investment Bank.
To apply and obtain funding is a time-consuming process and the process is best started by working on the business plans and searching for the suitable funding. Your company may just hold the keys to a greener Europe. The role of the board is to encourage and advise the company management accordingly.