Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/319634 
Year of Publication: 
2025
Series/Report no.: 
EIB Working Papers No. 2025/05
Publisher: 
European Investment Bank (EIB), Luxembourg
Abstract: 
Leveraging data from the European Investment Survey (EIBIS) spanning 2019-2022, encompassing the pandemic crisis and the 2022 energy price shocks, our study investigates how uncertainty influence firms' climate action investment decisions in Europe at a time of one of the largest energy shocks in recent history. Our results offer insights into firms' investment behaviors across various dimensions including country, sector, and firm size. We find that increasing energy prices drove European firms to invest in both energy efficiency and climate action investments to maintain competitiveness, albeit with a more pronounced effect on the former. By contrast, uncertainty deters firms from investing in climate action and reaching their potential, making them prioritize short-term challenges over long-term climate concerns. Additionally, we observe that firm characteristics, notably energy intensity, play a significant role in shaping investment decisions, with firms operating in energyintensive sectors demonstrating a greater likelihood to invest in climate action regardless of uncertainty levels. Our results reveal the challenges and trade-offs that firms face when investing in climate action under uncertainty and high energy prices and emphasize the need for consistent and supportive policies to foster a green transition.
Subjects: 
European Investment Bank Investment Survey
Uncertainty
Energy efficiency
Corporate investments
Energy costs
Climate Action
JEL: 
D22
P28
Q5
Persistent Identifier of the first edition: 
ISBN: 
978-92-861-5949-7
Document Type: 
Working Paper

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.