German companies’ climate action investments increase 18% in 2022
Clean Energy Wire
Climate protection investments by German companies rose by 18 percent in real terms in 2022 to 72 billion euros, said KfW, a government-owned development banking institution. The increase came despite economic uncertainties as a result of the energy crisis, it said. KfW’s “Climate Barometer 2023” report says that the sharp rise in energy prices for fossil fuels has made investments in energy efficiency and the use of renewable energies more attractive, and that the increase was mainly shouldered by large companies. “In 2022, one in seven euros of all new investment by the corporate sector went towards climate protection projects,” said chief economist Fritzi Köhler-Geib, adding that these had gained in importance compared to other investment areas. The report also shows that almost two thirds of German companies have at least partially anchored climate protection in their strategy. However, around 70 percent of companies have not yet developed any concrete plans to reduce greenhouse gas emissions, and this mainly affects small and medium-sized enterprises, said KfW.
In addition to state funds, private investments are key to making the move to climate neutrality an economic success. The money is needed, for example, to expand renewables, convert business practices, and transform entire industries to be climate friendly. KfW said that getting to climate neutrality will require significantly more investments, namely about 120 billion euros annually until mid-century.