EU Unveils €650 Billion Fund to Help Cities Achieve Climate Goals by 2030

The European Commission has announced the launch of the Climate City Capital Hub, a new initiative designed to support 112 EU cities in achieving climate neutrality by 2030. This ambitious project targets a €650 billion investment, leveraging both public and private capital, and is supported by the European Investment Bank (EIB).

The Climate City Capital Hub aims to provide financial support and guidance to cities as they develop and implement their climate action plans. The Hub will facilitate the structuring of financial needs and connect projects with a diverse range of capital providers.

EIB Vice President Teresa Czerwinska highlighted the bank’s commitment, stating, “EIB provides over a quarter of our lending to cities, and as Europe’s climate bank we are keen to work with cities to help them implement their climate-neutrality investments.”

The initiative is particularly focused on cities involved in the EU Mission on Climate-Neutral and Smart Cities. These cities will benefit from the EIB’s earmarked €2 billion for investments in energy-efficient buildings, renewable energy, and sustainable infrastructure. Currently, 33 cities with the EU Cities Mission Label have allocated €114.1 billion for climate actions, averaging €3.6 billion per city.

The Hub’s launch was announced at the 2024 Cities Mission conference in Valencia. Managed by NetZeroCities, the Hub will offer comprehensive services for both climate mitigation and adaptation projects, emphasizing the engagement of private capital. Innovative financing solutions, including crowdfunding and sustainability-linked bonds, will be explored to meet the investment needs.

Allison Lobb, executive director of Bankers without Boundaries, commented on the initiative, “Historically, cities have not been significant partners for the private sector, but progress can be much faster if private capital is more involved.”

Cities such as Lyon, Seville, Malmo, Lisbon, and Florence are among those developing climate plans with support from the EU and Bankers without Boundaries. These efforts are crucial as cities account for more than 70% of global CO₂ emissions and consume over 65% of the world’s energy.

The Climate City Capital Hub represents a significant step towards the EU’s broader climate goals. The initiative aims to reduce greenhouse gas emissions by 55% by 2030 and achieve climate neutrality by 2050, contributing to the European Green Deal.

The EU Cities Mission, which started in April 2022, selected 100 EU cities and 12 cities from countries associated with Horizon Europe to participate. These cities are testing innovative approaches in citizen engagement, stakeholder management, and governance to accelerate their path to climate neutrality, serving as hubs of experimentation and innovation.