Achieving the climate and energy targets will be one of the greatest challenges for fiscal policy in the coming years. As it is expected that investments in the implementation of these targets will increase significantly, one of the solutions frequently mentioned in the discussions on potential changes in fiscal rules at the EU level is the special treatment of green investments in calculating the indicators of compliance with the rules. Within this context, we have assessed how great the consequences of implementing the climate and energy targets set out in the National Energy and Climate Plan (NECP) for public finance in the period until 2030 would be.
We estimate that the volume of investments contributing to the achievement of climate and energy targets in 2016–2020 at the level of national economy amounted to EUR 5 billion or on average 2% of GDP per year. Approximately three-quarters of this were private funds, which had been, to a significant extent, mobilised through targeted incentives from public funds. In the NECP, the investment requirements for meeting the targets are estimated at EUR 28.4 billion, which amounts to, on average, 6% of GDP per year.
According to our estimate, the funds available from the identified dedicated resources for investments in the 2021–2030 period amount to EUR 11.6–12.3 billion. This means a two times greater annual average than in 2016–2020. Based on this estimate, we have devised different scenarios of investment potential. According to the scenario that best reflects the current state and requires the least changes in orientations, the investment potential amounts to EUR 19.7–20.4 billion. According to this scenario, the Eco Fund would earmark a similar amount of funds for grants in the future as in the last few years, when the time of application processing has increased considerably due to the Eco Fund’s limited staff and administrative capacities. The estimate also includes quite optimistic assumptions regarding the scope of mobilisation of private financial resources related to investments in buildings that were taken into account in the national strategy on energy renovation of buildings adopted last year. The gap between the investment potential envisaged in this scenario and the required volume of investments in 2021–2030 identified in the NECP amounts to EUR 8.0–8.7 billion. This represents nearly half of the average annual volume of investments of the general government in the 2016–2020 period or approximately 2.0% of GDP per year.
In any event, the available dedicated resources will need to be used more efficiently than in the past to properly address the climate and energy challenges. This would include a considerable increase in the efficiency and ability of their use, the adoption and effective implementation of numerous new measures, and a significant strengthening of the institutional framework and capacities. Based on the nature of the necessary measures and past experience, we conclude that, regardless of the chosen investment potential scenario, the gap should probably be closed with public funds, as the private sector has not yet shown any interest in investing in what are mainly infrastructure projects and is, at least in the electricity industries, also dealing with limited financial resources considering the identified investment needs.