The transition to a low-carbon economy creates financial risk and opportunities. A key barrier for investors in responding to this risk relates to the shortcomings of the current landscape of asset valuation and credit risk models in capturing this financial risk and opportunity. The objective of the project is to develop an Energy Transition (ET) risk and opportunity assessment framework. The objectives of this framework are to help investors and policy makers understand the materiality of energy transition risk and opportunity, help investors assess this materiality for bond and equity portfolios, and engage with investors & policy makers on responding to these risks in order to mobilize capital for sustainable energy investment. The activities focus on seven key industries. The core focus is on building bottom-up databases, Energy transition risk and opportunity scenarios net margin impact models. These outputs will then feed into newly developed equity valuation (developed by Kepler-Cheuvreux) and credit risk models (developed by S&P Capital IQ). The project enables investors and analysts to implement these models into their investment decision-making, either through the assessment framework or directly equity and bond indices developed in the course of the project.

To achieve climate neutrality by 2050, EU policy will have to be reoriented. It needs work simultaneously towards climate neutrality across the economy rapidly enough to achieve the Paris Agreement’s goals, while delivering on a broad range of issues, from competitiveness and productivity to employment and health. The concept of the European Green Deal captures this overarching narrative. However, to mobilise the creative, financial and political resources to achieve the required degree of technological, economic and behavioural change, the EU also needs a governance framework that facilitates cross-sectoral policy integration and allows citizens, public and private stakeholders to participate in the process and to own the results. 4I-TRACTION analyses what transformative climate policy could look like for the EU. Based on a stocktake of existing climate policies and their performance, it will spell out a number of policy avenues and an overarching governance framework, to describe how the current mix of EU climate and energy policies needs to evolve in the 2020s to set course for climate neutrality by 2050. The analysis will be structured around four cross-cutting core challenges, the “4 I’s”: 1) fostering breakthrough Innovation, 2) shifting Investment and finance, 3) rolling out the Infrastructure for a climate-neutral and resilient economy, and 4) Integrating solutions across sectors. This structure reflects that a systemic transformation will need to evolve beyond sectoral policy approaches. Incorporating scientific insights and policies from outside the EU as well as examining how the EU’s efforts interact with those of other key countries, the analysis will also include the global context. The analysis will be thoroughly grounded in science, but also aligned with the EU's dynamic political environment. To receive input, provide feedback and validate conclusions, the project will closely engage with a broad set of stakeholders throughout its lifespan.

The CARISMA project has two overall objectives. First, through effective stakeholder consultation and communication leading to improved coordination and assessment of climate change mitigation options, it aims to benefit research and innovation efficiency as well as international cooperation on research and innovation and technology transfer. Second, it seeks to assess policy and governance questions that shape the prospects of climate change mitigation options, and discuss the results with representatives from the CARISMA target audiences to incorporate what can be learned for the benefit of climate change mitigation. The experienced, interdisciplinary and diverse CARISMA consortium has an extensive track record of collaborating in Framework Programme projects. It combines capacity for technological, environmental, economic and social assessment with deep expertise across a range of climate change mitigation options, encompassing mature and emerging technologies as well as practices and governance, which are increasingly identified as important areas to achieve deep greenhouse gas emission reductions. Communication with, and support to, the CARISMA target audiences are an integral part of the project. In all inventory and assessment activities envisaged in the project, interaction with stakeholders is a key part. To facilitate coordination and avoid overlap, these activities are overseen by a dedicated work package. The target audiences include national and local policymakers, innovation and strategy managers in business and industry, research funding organisations and the research community. The CARISMA project will result in online platform services, face-to-face interactions, policy briefs and publications and increased capacity in the EU, Accession Countries and beyond, to address the climate change challenge and move towards a green, innovative and thriving global economy.

Forests represent the largest terrestrial carbon sink that can be economically managed to combat climate change. In this context, sustainable forest management will become a major tool of the EU Green Deal on the road to an economic growth decoupled from resource use. But essential forest functions are increasingly threatened by climate change and related natural disturbances, while the knowledge regarding the effects of forest management on biophysical and biogeochemical fluxes exchanged between land and atmosphere are too limited. Accordingly, the overall objective of the INFORMA project is to increase the science-based knowledge on multi-purpose sustainable forest management under climate change. More particularly, it will analyse the trade-offs and synergies between different objectives considering the environmental integrity and climate feedbacks, social acceptability and economic feasibility of future European forest practices, including zero management options. It will identify options for maintaining carbon sinks, in addition to fostering productivity, supporting genetic diversity, biodiversity conservation, and maintaining soil and water resources in the different European ecoregions. Applying a multi-actor approach, INFORMA will 1) Quantify differences in major ecosystem functions affecting climate processes between managed and unmanaged forests across Europe; 2) Analyse socio-institutional patterns of innovative forest-based mitigation and adaptation strategies; 3) Search for management alternatives (including no-management) and simulate their effect on a variety of ecosystem functions; and 4) Improve forest carbon certification for a cost-effective operationalisation and integration of climate smart practices in forestry. INFORMA main outputs will be best regional management practices, implementation pathways for the European forestry sector, recommendations for forest carbon certification improvements and for economic-institutional policy action.

The European Commission is developing the first EU-wide voluntary framework for certifying carbon removals, carbon farming and carbon storage in products across Europe. By establishing EU quality criteria and laying down monitoring and reporting processes, the CRCF Regulation will facilitate the adoption of carbon farming solutions, while addressing greenwashing, and provides a "result-based" (quantified) remuneration system for farmers and foresters' climate performance. Key to the CRCF regulation are robust cost-effective Monitoring, Reporting and Verification (MRV) systems and a geographically explicit registry. Therefore, the main goal of CAFAMORE is to develop an EU-wide parcel level monitoring approach for Carbon Farming, with harmonisation and automation of data collection, robust and cost-effective quantification of activities and baselines, a spatially explicit registry and a robust market place. This will be accompanied by an in-depth assessment of the carbon markets and business strategies for carbon farming. CAFAMORE will facilitate certification schemes by providing tools for the quantification and monitoring of Carbon Farming activities through providing operational processing chains that connect earth observation data, soil and management data and models, including changes in SOC stocks, woody biomass and soil N2O emissions. This parcel-level data collection infrastructure can also serve companies for their CSRD reporting and member states for their National Greenhouse Gas Inventories. The MRV approaches and tools will be tested with farmers and certification actors in seven pilot countries, covering the main climatic zones and the diversity in European agriculture. The digital infrastructure and MRV tools will reduce the administrative burden for land managers, provide transparency over collected data and certificates and trust to the Carbon Farming market, which should increase the attractiveness of carbon farming.