‘Belgium must invest €25 billion annually to be climate neutral by 2050’

The European Union and Belgium have made a clear commitment to climate neutrality to achieve the objectives of the Paris Climate Agreement. However, achieving this objective will require significant investments, leading to a profound transformation of our society.

According to a new report from the Federal Climate Change Service in collaboration with the Study Committee for Public Investments of the Federal Planning Bureau, up to 25 billion euros (4.3 percent of GDP) should be invested annually to make Belgium climate-neutral by 2050.

The researchers examined and compared the available net zero transition scenarios. They all assume greater energy efficiency and the use of non-fossil energy, mainly through electrification. They reached some essential conclusions.

Significant investments

First, the transition to climate neutrality could potentially involve many additional investments. Depending on the scenario, the amount fluctuates between 11 billion euros (1.9 percent of GDP) and 25 billion euros (4.3 percent of GDP) per year.

Using sufficiency levers, such as reducing demand for energy and transport, has a major impact on these investment needs, which differ per sector. The study focused on four sectors—buildings, transport, energy, and industry—that account for 90 percent of our country’s greenhouse gas emissions.

Substantial savings

While the investments are significant, they will lead to substantial savings through greater energy efficiency and renewable energy sources. In the most favorable scenario, operational costs are 15 billion lower than they are now.

However, by 2050, the savings could rise to 28.5 billion euros because many measures to reduce greenhouse gas emissions also reduce energy demand.

The researchers warn against interpreting the investments and operational costs as ‘the cost’ of the climate transition because not all investment consequences were analyzed.