• Client: European Commission - DG Climate Action
  • Implementation period: 2017 - 2017 (Completed)
  • Geographic coverage: European Union

How have the current (2014-2020) MFF arrangements for climate mainstreaming worked in practice – and what are the potential options for improvement?

The EU is committed to achieving a low-carbon, resource-efficient and climate-resilient economy by 2020. At the time that the Europe 2020 Strategy was adopted, it was estimated that €125 billion per annum in investment needs would be needed to carry out climate mitigation actions across all sectors to achieve these targets within the timeframe set by the Europe 2020 Strategy. Further investments are necessary for climate adaptation actions. While there is consensus that meeting this investment need has been particularly challenging, reliably estimating the full extent of this gap has been equally challenging, as has been determining the contribution required from public finance, and from public finance at the EU level.

The latter task – the contributions from public EU finance – were the focus of this study. These issues are also integral for the Commission’s proposals for the forthcoming Multiannual Financial Framework (MFF) post 2020. In addition to identifying funding needs, and leveraging the necessary finance to meet the anticipated gaps, a robust framework for tracking progress towards the long-term climate goals is essential to ensure transparency and accountability in EU climate-related expenditure as well as helping to target this spending. The study was led by Ricardo-AEA, supported by Trinomics and IEEP. The project conducted a detailed analysis of current arrangements for tracking climate-related expenditure and how this has operated in practice.

The study concluded with the identification of options for improving the current approach. The main recommendations were:

  • Additional guidance can help to guide climate mainstreaming activities within budget programmes, but also ensure greater consistency in the approaches taken. Example: ‘Single rule book’.
  • For some elements of mainstreaming and tracking, the further development of tools and methodologies will enhance existing activities, like by addressing knowledge gaps and sharing best practice.
  • Even where methodologies have been developed, it may still be necessary to ensure that they are applied consistently. This may require some further moderation of the approaches taken. Among others, it is recommended to revisit the allocation of climate markers.
  • For some areas it is recommended that some new requirements should be considered for introduction to support mainstreaming activities. For example, we recommend that it should be a requirement for climate mainstreaming to be considered for all areas.
  • Perform further research and analysis of EU programmes to identify EU programmes which are most capable of delivering climate objectives
  • Improve linkages with other requirements, like the National Energy Climate Plans (NECPs) as well as the climate objectives (EU and national level) to be achieved.