Finance

Finance

The transformation to a sustainable, climate-neutral economy is also a matter of financing. On the one hand, we need to mobilize the necessary funds to develop green technologies, bring them to market maturity, and roll out the infrastructure to support them. On the other hand, there is the matter of dealing with investments in sectors that are still dominated by fossil fuels – especially investments in fossil energy resources, the associated infrastructure, and value chains. Ecologic Institute provides analyses of incentives and tools to attract more sustainable finance. It also looks at how to shift finance away from fossil investments, which includes comparing and assessing international best practices.

Private investors play a special role in this process. Through their demand, they are already driving the development toward climate-friendly, sustainable investments. However, they need to be able to rely on clear standards regarding which financial products are classified as sustainable for what reason, and what their actual climate footprint is.

Ecologic Institute has addressed these questions from different angles, inter alia developing standards to assess which investments can be considered sustainable. At the individual level, Ecologic Institute also brings in practical expertise on how financial markets can be used for sustainability purposes and which innovative financing instruments are suitable for environmental and sustainability innovations.

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Aaron Best
Coordinator Digitalization and AI
Senior Fellow

Economics

Climate

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Hugh McDonald
Senior Fellow
Selected Projects for Finance
ProjectThe EU Taxonomy as an Instrument to Reach Climate Neutrality
 

Bild von Gerd Altmann auf Pixabay

With the European Green Deal, the EU wants to become climate neutral by 2050. To achieve this, we must decarbonize our energy systems and economies. This effort requires investments in sustainable economic and financial activities. An important building block is the EU... Read more

The EU Taxonomy as an Instrument to Reach Climate Neutrality

Duration
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Funding
ProjectThe Use of ETS Auctioning Revenues in EU Member States
 

Imagine by David Mark from Pixabay

The EU has agreed to reach climate neutrality by 2050 and has enshrined this objective in the European Climate Law. Achieving this objective necessitates a transformation of the EU economies that requires significant additional investments across all sectors. One key... Read more

The Use of ETS Auctioning Revenues in EU Member States

Duration
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Funding
ProjectAccessibility of the Climate Change Adaptation Finance Data in Europe
 

Flood protection example in Saxony-Anhalt (Germany)

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Image by Pixaline from Pixabay

Ecologic Institute, in collaboration with the Frankfurt School of Finance & Management and Ramboll Consulting, implemented the project "Accessibility of the Climate Change Adaptation Finance Data in Europe" for the European Environment Agency (EEA). The objective... Read more

Accessibility of the Climate Change Adaptation Finance Data in Europe

Duration
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Funding
ProjectDialogue Forum "Business Mitigates Climate Change"
 
Logo des Dialogforums Wirtschaft macht Klimaschutz
The Dialogue Forum "Business mitigates climate change" aimed to increase networking within the German economy to improve climate protection. After the spring of 2017, around 100 companies from all sectors of the economy worked closer together and exchanged information.... Read more

Dialogue Forum "Business Mitigates Climate Change"

Duration
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Funding
ProjectAssistance in Developing Criteria on Agricultural Activities to be Included in the EU Sustainable Finance Taxonomy
 
| ©AlexRagen | Pexels.com
The efforts to meet GHG emission reduction targets in line with the Paris Agreement will require broad deployment of investments from both public and private sectors. The EU Sustainable Finance Taxonomy is a classification system that defines activities which are deemed... Read more

Assistance in Developing Criteria on Agricultural Activities to be Included in the EU Sustainable Finance Taxonomy

Duration
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Funding
ProjectAssistance in Developing Criteria on Agricultural Activities to be Included in the EU Sustainable Finance Taxonomy
 
| ©AlexRagen | Pexels.com
The efforts to meet GHG emission reduction targets in line with the Paris Agreement will require broad deployment of investments from both public and private sectors. The EU Sustainable Finance Taxonomy is a classification system that defines activities which are deemed... Read more

Assistance in Developing Criteria on Agricultural Activities to be Included in the EU Sustainable Finance Taxonomy

Duration
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Funding
ProjectOekoworld Workshop on Sustainability Evaluation of Businesses in the Digital Economy
 
Sascha Dickel & Christian Thorun strukturieren den Ökoworld Workshop am Ecologic Institut
The Oekoworld Workshop on Sustainability Evaluation of Businesses in the Digital Economy in Berlin explored new ways to express ethical values in relation to digitalisation as a series of complex technological and business-model innovations in the context of ethical and... Read more

Oekoworld Workshop on Sustainability Evaluation of Businesses in the Digital Economy

Duration
Funding
ProjectLisbon Workshop on Blue Natural Capital (BNC)
 
Teilnehmer beim Lisbon Workshop on Blue Natural Capital (BNC) © Oceano Azul Foundation
The Lisbon Workshop on Blue Natural Capital (BNC) took place on 3 and 4 October 2018 at the Lisbon Ocean Aquarium (Oceanário de Lisboa) in Portugal. It was hosted by the Oceano Azul Foundation (Fundação Oceano Azul) and prepared and chaired by R. Andreas Kraemer,... Read more

Lisbon Workshop on Blue Natural Capital (BNC)

Duration
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Funding
ProjectGreen Finance – Strategies and Instruments for the Financing of Ecological Modernization
 
| © Fotolia Corgarashu
The transition towards a "Green Economy" requires investment and adequate funding. But what exactly are the financing requirements of a green transformation in the areas of energy and energy storage, energy efficiency, mobility, material efficiency, recycling,... Read more

Green Finance – Strategies and Instruments for the Financing of Ecological Modernization

Duration
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Funding
ProjectIncome Tax Reform to Strengthen Climate Protection
 
| Fotolia © Romolo Tavani
Ecologic Institute analyzes to what extent Germany's income and cooperate tax rules promote climate protection. In this context, Ecologic Institute presents proposals for reforming Germany's income tax law. The analysis and the proposal are available for download. This... Read more

Income Tax Reform to Strengthen Climate Protection

Duration
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Funding
ProjectFunding Climate Action: the EU Emissions Trading System and its Auctioning Revenues
 
| Fotolia © 3 Guillaume Le Bloas
Reaching an emissions pathway consistent with the Paris Agreement requires a transformation of the economy and entails significant public and private expenditure. Auctioning revenue generated by the EU Emissions Trading System (ETS) could contribute a critical share of... Read more

Funding Climate Action: the EU Emissions Trading System and its Auctioning Revenues

Duration
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Funding
ProjectEconomic Implications of Regulation in the Carbon Market
 
| Fotolia © mdfile
In the last few years, regulation of European financial markets has evolved – primarily through the adoption of the second EU Markets in Financial Instruments Directive (MiFID II) and further EU Directives and Regulations, including those on market abuse and money... Read more

Economic Implications of Regulation in the Carbon Market

Duration
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Funding
ProjectRio+20: Financing International Environmental Governance
 

© Benjamin Görlach

In the run-up to the Rio+20 summit, the Ecologic Institute investigated the current system for financing international environmental governance (IEG). The study was commissioned by the German Federal Agency for the Environment and is available for download. In June... Read more

Rio+20: Financing International Environmental Governance

Duration
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Funding
ProjectGreen Budget Reform - a Sustainable Response to the Economic Crisis?
 
Green Budget Reform - a Sustainable Response to the Economic Crisis?
In the wake of the global financial and economic crisis, Germany is facing its worst recession in post-war history. For the public budget, this implies a dramatic drop in tax revenue. At the same time, spending increased strongly because of the adopted stimulus packages... Read more

Green Budget Reform - a Sustainable Response to the Economic Crisis?

Duration
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Funding
ProjectCost and Financing of Community Renewable Energy Projects (FIN-COMMUNITY)
 
| Fotolia © 3desc
The overall objective of the project is to identify, document and assess the cost and financial impacts faced by community-owned renewable energy projects compared to commercial renewable energy projects, meaning projects realised by large investors. The project... Read more

Cost and Financing of Community Renewable Energy Projects (FIN-COMMUNITY)

Duration
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Funding
ProjectThe Decarbonization of Finance: A Transition Towards Low-carbon Investment
 
Die Dekarbonisierung der Finanzen
On 21 October 2015, the Ecologic Institute US hosted an evening symposium at the Consulate General of Germany in New York to discuss the Decarbonization of Finance with key stakeholders from finance and policy in Germany and the US. 60 external participants joined... Read more

The Decarbonization of Finance: A Transition Towards Low-carbon Investment

Duration
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Funding
All projects on Finance
Selected Publications for Finance
PublicationKnowledge for Future – The Environment PodcastEU-Taxonomie: Ein guter Schritt für mehr Nachhaltigkeit?
 

Bild von Orlando auf Pixabay

Europe is to become climate-neutral by 2050. The EU Commission is striving to achieve this goal with the European Green Deal, which it published at the end of 2019. In order to achieve the climate targets, a lot of money will have to be invested – according to estimates... Read more

Ecologic Institute, detektor.fm 2022: EU-Taxonomie: Ein guter Schritt für mehr Nachhaltigkeit? Knowledge for Future – Der Umwelt-Podcast. 21 December 2022. Online: https://detektor.fm/politik/knowledge-for-future-eu-taxonomie

PublicationPodcastFifty Shades of Green: Sustainable finance and the EU taxonomy
 

© Ecologic Institute

How do we classify which investments are the right ones to power the transition to a climate and nature-friendly economy? This is a pretty big question, and one that is crucial to a successful implementation of the European Green Deal. The EU taxonomy – the subject of... Read more

Ecologic Institute 2022: Fifty shades of green: sustainable finance and the EU taxonomy. Podcast. Online: https://greendealbigdeal.podigee.io/7-sustainable-finance

PublicationReportSmart Cash for the Climate: Maximising Auctioning Revenues from the EU Emissions Trading System
 
Member States earned close to EUR 12 billion from auctioning in the EU Emissions Trading from 2013 to 2015 with over 80% of the money so far spent on climate action – most of it in the EU. The funding mainly went to renewables, efficiency and cross-cutting programmes.... Read more

Velten, Eike Karola; Matthias Duwe; Elizabeth Zelljadt et. al. 2016: Smart Cash for the Climate: Maximising Auctioning Revenues from the EU Emissions Trading System. An analysis of current reporting by Member States and options for improvement. Ecologic Institute: Berlin.

PublicationReportRahmen für Klimaschutzinvestitionen – Hemmnisse und Maßnahmen
 
Hermann, Andreas; Nils Meyer-Ohlendorf; Arne Riedel et. al. 2016: Rahmen für Klimaschutzinvestitionen – Hemmnisse und Maßnahmen. Darmstadt/Berlin. ... Read more

Hermann, Andreas; Nils Meyer-Ohlendorf; Arne Riedel et. al. 2016: Rahmen für Klimaschutzinvestitionen – Hemmnisse und Maßnahmen. Darmstadt/Berlin.

PublicationReportPurchase Channels for German Installation Operators in EU Emissions Trading
 
This report evaluates the results of a survey conducted in the summer of 2013 among German operators by Ecologic Institute and the German Emissions Trading Authority (DEHSt). The report shows that in the third trading period there will be shifts within the carbon market... Read more

Grünig, Max; Sabine Lund; Jan Weiß et al. 2014: Purchase channels for German Installation Operators in EU Emissions Trading. Evaluation of a Survey among all Operators of German Installations on their Purchase Strategies in the Second and Third Trading Period, Berlin.

PublicationReportNachhaltig aus der Krise
 
Görlach, Benjamin; Nils Meyer-Ohlendorf; Michael Kohlhaas 2009: Nachhaltig aus der Krise. Analyse möglicher Beiträge einer ökologischen Finanzreform. ... Read more

Görlach, Benjamin; Nils Meyer-Ohlendorf; Michael Kohlhaas 2009: Nachhaltig aus der Krise. Analyse möglicher Beiträge einer ökologischen Finanzreform.

PublicationReportTransforming Economies through Green Investment
 
In his 2010 State of the Union address, President Obama declared the need for "serious investments in clean energy" because "the nation that leads the clean energy economy will be the nation that leads the global economy". In a new paper funded by the German Marshall... Read more

Mehling, Michael et al. 2010: Transforming Economies through Green Investment: Needs, Progress and Policies. [GMF Climate & Energy Paper Series 2010]. Washington DC: German Marshall Fund of the United States.

PublicationReportEU Sustainable Finance Taxonomy – Technical Report
 
The Technical Expert Group (TEG) on Sustainable Finance published a proposal for an EU classification system, or a Taxonomy, which sets out screening criteria for economic activities that can contribute substantially to climate mitigation and adaptation. The taxonomy is... Read more

EU Technical Expert Group on Sustainable Finance (ed.) 2019: Financing a Sustainable European Economy. Taxonomy. Technical Report. European Commission: Brussels.

PublicationReportLegal Nature of EU ETS Allowances
 
Report cover with title and collage of forest elements

©  European Commission

The objective of this project is to provide clarity on the legal nature of the allowances of the EU Emission Trading System (EU ETS) excluding the international carbon units (e.g. assigned amount units (AAUs), certified emission reductions (CERs), emission reduction... Read more

Riedel, Arne et al. (2019): Legal nature of EU ETS allowances. Milieu Ltd, Ecologic and Klimapolitika. European Commission’s Directorate General CLIMA. Luxembourg.

All publications on Finance
Selected Events for Finance
EventDinner DialogueWhat's Next for the EU Taxonomy for Sustainable Finance?
 

Photo by Paul Skorupskas on Unsplash

The EU taxonomy regulation for sustainable finance has received much attention. Some see it as an essential part to help shift the vast amounts of capital that is needed for the transformation of our economies. Others claim it to be yet another classification system... Read more

Dinner Dialogue:What's Next for the EU Taxonomy for Sustainable Finance?

Date
Location
Berlin, Germany
EventWorkshopGreen Finance – Strategies and Instruments for the Financing of Ecological Modernization
 
| Fotolia© Corgarashu
As part of the "Green Finance – Strategies and Instruments for Financing the Ecological Modernisation Process" project, the Federal Environment Agency organized a workshop to discuss initial research findings on the financing requirements for a green... Read more

Workshop:Green Finance – Strategies and Instruments for the Financing of Ecological Modernization

Date
Location
Berlin, Germany
All events on Finance