Massive Investments Needed for Ecological Transition: Green ISF and Other Financing Options Discussed by French Government

The Financial Markets Authority (AMF), the Banque de France, insurance companies, banking establishments, investment funds, Ministers of the Economy Bruno Le Maire, Ministers of Energy Transition Agnès Pannier-Runacher, of Ecological Transition and Territorial Cohesion Christophe Béchu, scientists like Jean-Marc Jancovici… They were all around the table, this Wednesday, July 12, as part of the Ecological Transition Financing Committee.

Climate emergency: Jean Pisani-Ferry recommends investing 70 billion euros by 2030

The green ISF, a ” easy way out »

The stated objective, to unearth 60 to 70 billion euros per year, in the continuity of the report produced by the economist Jean Pisani-Ferry, and this, while interest rates continue to rise, access to credit is more difficult and “the era of free money is over”, said the tenant of Bercy himself. The roadmap is clear: assess the cost of abatement per tonne of carbon, define the return on capital in the medium and long term, depending on the degree of maturity of the technologies and invest massively in adaptation to climate change.

Reinstate the ISF, the rising scenario to finance the ecological transition

Sending the green ISF back to their goals again, calling it a “easy way out”, Bruno Le Maire announced, during a telephone press conference, his desire to massively mobilize private savings, namely nearly 150 billion euros per year. This amount represents 5% of the 3,200 billion long-term savings, more or less blocked, such as life insurance, not to be confused with 5,800 billion which include deposits.

The PEL and the LDDS to the rescue

With nearly 500 billion euros between them, the housing savings plan (PEL) and the sustainable and solidarity development booklet (LDDS) could also be used, in particular to finance early renovation without tax loss for the individual who would dig into it. At the same time, the Minister of the Economy promised state support for the most modest households, citing car leasing ” in the coming months “. Or a zero-rate eco-loan (eco-PTZ) to accelerate investments.

Electric car: leasing at 100 euros, a headache for the government

Another avenue explored, the state guarantee on risky projects. In the same way that the Energy Regulation Commission (CRE) sets electricity buy-back tariffs over 20 years for wind projects, the State is considering the same system for photovoltaics and green hydrogen. ” On prices and volumes, it will be a question of reducing the risks in a targeted manner “, specifies the cabinet of Bruno Le Maire.

Measures contained in the 2024 budget, others not

The latter has not forgotten the standard, such as that which prohibits thermal vehicles. The work to define the “Triple E” environmental standard, mentioned in the context of the law on green industry, will thus be “officially launching next week “Also announced Bercy. The government has asked the French association for standardization (AFNOR) to make proposals “by the end of the year”.

Last track, and not least, pushed this time by the Banque de France: a climate indicator to obtain, in a transparent and independent manner, the list of companies committed to the fight against climate change. This tool could be available in 2024, while the reform of the PEL and the eco-PTZ as well as the guarantees of the State should be integrated into the 2024 budget, presented at the start of the school year.

On the other hand, there has never been any question of the financing of new nuclear reactors, whereas Bruno Le Maire and his colleague Agnès Pannier-Runacher are in the process of being heard by the Economic Affairs and Finance Committees of the National Assembly on this subject.