Under government’s IFS 2020 Strategy and supported by the Department of Finance, yesterday (2nd May) Sustainable Nation Ireland hosted #SustainableFinanceDay. Consisting of three events centred around green finance and responsible business, just under 300 people participated.
First up was a breakfast session on ‘Financial Disclosures on Climate Risk’. The guest speaker was Jane Ambachtsheer, Partner and Global Head of Responsible Investment, Mercer Investments and also a member of the international Financial Stability Board’s Taskforce on Climate-Related Financial Disclosures (TCFD). Moderated by BVP’s Ray O’Neill, Jane was joined by ISIF’s head of Responsible Investment, Emma Jane Joyce and EY’s head of sustainability, Lorraine McCann.
Following that was a session opened by Minister D’Arcy, Department of Finance. Moderated by Environmental Finance’s editor-in-chief Peter Cripps, two panels featured senior representatives from the European Investment Bank Cormac Murphy, the former CEO of the UK Green Investment Bank Shaun Kingsbury, Climate Bond’s Initiative Sean Kidney, Blackrock’s Teresa O’Flynn, Ireland’s Strategic Investment Fund Austin Coughlan, Dasos Cormac O’Carroll, iPUT’s Pat McGinley and Mercer’s Jane Ambachtscheer. Underpinned by a presentation by Michael Flynn, Partner Deloitte this event focused on how Ireland can best accelerate the mobilisation of private capital into Irish low-carbon projects between now and 2027.
Finally, Irish-Australian Sean Kidney led a much-anticipated discussion on green bonds which last year topped $150bn globally for the first time as several governments, development banks, and corporates issued certified green bonds. Joined by HSBC’s UK lead on sustainable bonds, Victoria Clark, both spoke about the rising influence of green bonds on global financial and investment decisions.
Mobilising Private Capital into Ireland’s Sustainable Infrastructure needs
Staying with the second session – Mobilising Private Capital into Ireland’s Sustainable Infrastructure needs, the transition to a low-carbon sustainable economy will require significant investment in sustainable infrastructure. At a global scale, estimates of the financing requirements are in the range of up to €90 trillion. Meanwhile, at a European level the European Commission has estimated that €177bn additional investment a year is required to achieve Europe’s 2030 climate and energy targets. While there may be some uncertainty on the specific financing requirements, what is certain is that public sector money cannot cover the full extent of the investment required.
Government’s recently launched National Development Plan (2018-2027) sets out a substantial decarbonisation programme worth up to €21.8 billion. Investment priorities include upgrading 45,000 homes per annum from 2021, providing up to 4.5GW of additional renewable energy and transitioning to low-emission public transport. The Government also recommends that all new vehicles should be zero emissions beyond 2030.
Commissioned by Sustainable Nation Ireland for the 2nd May event, Deloitte developed the paper Private Sector Financing for Sustainable Infrastructure, Meeting Ireland’s 2030 Decarbonisation Objectives. This paper estimated that meeting Ireland’s 2030 decarbonisation targets will require at least €50 billion in investment, which includes government’s €21.8 billion investment programme.
As such and as relates to Ireland, crowding in private capital is essential if we want to reach our decarbonisation targets in the coming years, with green finance having a substantial role to play in mobilising the necessary private capital for this investment.
Realising such an investment programme will require considerable engagement and cooperation between Ireland’s public and private sectors, an engagement that Sustainable Nation Ireland already supports as part of its activities under government’s IFS 2020 Strategy.
With the right enabling environment in place, a potential combined €50 billion investment programme between now and 2030 can help mitigate the risks posed by climate change to Irish society; underpin Ireland’s ambitions to be a global leader in the area of green finance; invested in Ireland’s real economy will support jobs and investment at a regional level; and stimulate the need for innovation and new skills leading to possible export opportunities for Irish firms as they develop cutting edge technologies.
It builds on the €28 billion in green finance activities already underway in Ireland, while supporting the more than 370 Irish located firms already active in the climate-aligned enterprise space.
Picture (L to R): Michael Flynn, Corporate Finance Partner, Deloitte; Laura Heuston, Director of Sustainable Finance, Sustainable Nation Ireland; Minister Michael D’Arcy, Minister for Financial Services and Insurance, Department of Finance; Stephen Nolan, CEO, Sustainable Nation Ireland.