SEE and CEE companies lagging in climate-related investment - survey
Date: August 19th 2021
Author: Peter Palčec
Category: En.vision
Topic:
CO2 emissions
, Economy
, Ecology
, Energy Efficiency
Around 50% of companies in Western and Northern Europe reported investments to address climate change in 2020, 38% in Southern Europe and 32% in Central and Eastern Europe, according to an European Investment Bank (EIB) survey.
The differences are even more noticeable at the country level, says the latest survey to be commissioned by the EIB. The share of companies in the six EU member states in south-east Europe – Slovenia, Croatia, Hungary, Bulgaria, Greece and Romania – that are investing or planning to invest in tackling climate risks, is lower than the EU average of 45%.
However, when it comes to setting climate targets, Slovenia is the regional leader, with 45% of its firms setting climate targets, followed by Romania (38%) and Croatia (32%). Greece is at the bottom of the list with only 19% of companies setting climate targets, followed by Bulgaria (25%).
Two kinds of risks
“Climate change poses two kinds of risks for firms: direct physical risks and transition risks. Physical risks, such as those caused by acute weather events, are easier for firms to observe and understand. Transition risks are less evident, as they depend on global commitments to reduce their economies’ reliance on fossil fuels,” says the EIB in its survey report.
It says that the perception of physical risks and transition risks is lower than the EU average in Bulgaria and Slovenia, while in Romania and Croatia the perception of physical risks is higher and the perception of transition risks lower.
The EIB survey also shows that European companies have a harder time understanding the danger that energy transition poses to their product demand, supply chain and reputation.
Regulation and taxation fears
Meanwhile, uncertainty over regulation and taxation continues to hamper climate investments. Within the European Union, the most frequently cited obstacle is uncertainty about regulation and taxation (43%), followed by investment costs (41%).
When it comes to the SEE region, companies in Romania, Croatia, Slovenia and Bulgaria are generally less aware of climate risks and report fewer obstacles to investments than the EU average, with uncertainty about taxation and regulation being cited most frequently as the biggest investment barrier.
Meanwhile, investments in energy efficiency are continuing to increase. Nearly half (47%) of the EU firms polled say they have invested in energy efficiency, a 10% increase compared to 2019.
Firms in Western and Northern Europe invest the most in energy efficiency (48%), followed by Southern, Central and Eastern Europe at around 40%. Despite higher energy efficiency investments than in the previous year, Europe’s energy savings potential remains largely untapped.
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