Contents
1.1 Public Investment in the EU: Trends and Outlook 4
1.4 Capital Transfers Are Set to Remain above Average 12
1.5 Security of Energy Supply and the Climate Transition 13
1.6 Energy Dependence Indicators 13
1.7 Improving Security of Energy Supply in the EU: REPowerEU 17
2. Public Investment and Low-carbon Transition in France: Not Enough of a Good Thing? 23
2.1 Public Investment before the Pandemic: On a Downwards Trend since 2010 23
2.2 Public Investment during the Pandemic 29
2.3 Challenges and Perspectives of Low-carbon Investment: The Case of Infrastructures 30
2.4 Modelling Framework: The ThreeME Model 34
2.5 Macroeconomic Consequences of Additional Investment in Low-carbon Infrastructure 34
3. Public Investment in Germany: Squaring the Circle 41
3.2 Some Progress since 2019 42
3.3 War in Ukraine and High Inflation 44
3.4 Stability Programme Suggests that Additional Investment Is Mostly Military 45
3.5 The Critical Issue of Local Government Financing 47
3.6 The German Recovery and Resilience Plan 49
3.7 The Way to Sufficient Investment Spending 50
4. NRRP—Italy’s Strategic Reform and Investment Programme: Sustaining an Ecological Transition 55
4.1 Public Investment and the NRRP-Italian Public Works Schedule 56
4.2 Ecological Transition and Green Investments in the Italian NRRP 60
4.4 Multilevel Governance and the Role of Local Governments 66
5. Current Challenges in the Spanish Energy Market 71
5.1 Evolution of the Spanish Energy Sector: A Retrospective Review 71
5.2 Public Policies for a Green Transition (2020–2030) 75
5.3 Current Scenario after the COVID-19 Pandemic and the Russian Invasion of Ukraine 79
5.5 Final Conclusions and Policy Recommendations 83
6. How Big Are Green Spending Multipliers? 87
6.2 Green Energy versus Non-Green Energy Spending Multipliers 89
6.3 Green Land Use versus Non-Green Land Use Multipliers 91
7. Europe’s Green Investment Requirements and the Role of Next Generation EU 97
7.2 A More Detailed Examination 100
8. The Public Spending Needs of Reaching the EU’s Climate Targets 107
8.1 A Sectoral View of the Public Spending Needs in the EU 108
9. The Investment Needs for REPowerEU 129
9.1 Drivers of Natural Gas Demand Reduction in REPowerEU 131
9.3 Why Should the Potential for Natural Gas Reduction Be Higher than 155 bcm? 140
Annex on Price Trajectories between 2020 and 2050 for Gas, Oil and Coal 142
10. Public Spending for Future Generations: Recent Trends in EU Countries 145
10.1 GFCF and EFG in the EU 147
10.2 Trends in the EFG in the EU and Comparisons with the GFCF 148
10.3. Comparative and Absolute Advantage: International Comparisons 156
10.4 Conclusions and Policy Considerations 162
11. Assessing the Quality of Green Finance Standards 165
11.1 What Are Green Finance Standards? 166
11.2 What Are the Differences between Green Finance Standards? 170
11.3 Nuclear and Natural Gas as Green Investments? 171
11.4 Does Green Finance Product Deserve Public Financial Incentive? 172
12. Green Investments: Two Possible Interpretations of the “Do No Significant Harm” Principle 177
12.1 The DNSH Principle in the EU Documents 177
12.2 An Evaluation: The Need to Get out of an Impasse 179
12.3 An Open Mind Approach to the DNSH Principle 182
12.4 The War, REPowerEU and Taxo4 183
12.5 We Need a Flapping of Wings 185
13. Towards a Socially Just Green Transition: The Role of Welfare States and Public Finances 187
13.1 The EU Initiatives to Address the Socio-Ecological Transition 189
13.2 How to Tackle the Persisting Social Infrastructural Gap in the EU 190
13.3 A European Golden Rule for Social Investment 192