Iberian Green Transition: Up to 50 Billion Euros Needed Annually for Cleantech Investment
To achieve the decarbonisation goals set for 2030 and sustain competitiveness in the European clean industrial transition Spain and Portugal must mobilise up to 50 billion euros annually in additional public and private investment. The report titled Cleantech Investment Plan for the Iberian Peninsula by Cleantech for Iberia highlights the critical need for enhanced financial support during the scaling phase of clean projects.
Although both nations benefit from significant public capital current financing predominantly supports early-stage or mature bankable technologies. This leaves a substantial gap at the commercial scaling level and for first-of-a-kind projects which are innovative initiatives implemented for the first time and often struggle to secure necessary investments due to perceived risks and uncertainties related to future revenues.
Compared to other similar European economies the Iberian Peninsula needs to attract an additional at least four billion euros in venture capital by 2030 across public and private sectors. Bianca Dragomir Director of Cleantech for Iberia emphasises that the main bottleneck lies in the advanced and FOAK First-of-a-Kind project stages where projects tend to falter at the final investment decision point. She remarks that the key challenge is not the absence of public financing but the misalignment with the risk profiles of clean technologies during their growth stages.
Cleantech for Iberia considers that the current moment offers a unique opportunity for green industrialisation driven by the resurgence of manufacturing within Europe. This presents Spain and Portugal with a strategic window to position themselves as centres for the manufacturing and deployment of clean technologies aligning with their reindustrialisation strategies and attracting sustainable investments.
Looking ahead the report warns that the coming months will be decisive in determining whether Spain and Portugal establish themselves as global leaders in cleantech deployment or risk losing projects and talent to other jurisdictions. To facilitate this transition the organisation recommends consolidating existing tools to attract private investment and accelerate cleantech deployment.
Key solutions proposed include mechanisms to stabilise demand and revenue through instruments such as auction-based contracts for difference for hydrogen renewable gases and storage complemented by green public procurement to incentivise investment. Additional focus is placed on creating specialised platforms or coordinated measures to provide patient risk-tolerant capital for FOAK projects supporting their realisation and commercialisation.
Public financial instruments like tailored loans and subordinated debt are also essential enabling projects to refinance via private sector senior debt as risks diminish over time. Specific guarantees aimed at covering residual risks are suggested to facilitate earlier-stage financing and enhance bank and institutional investor participation. Initiatives such as Spain Grows with public capital of approximately 10.5 billion euros and the Portugal Modernisation Fund are poised to reinforce these efforts.
Ultimately the report underscores a shared ambition to anchor industrial competitiveness through clean production aiming to establish the Iberian Peninsula as a key hub for low-carbon European value chains spanning sectors from steel and green chemicals to advanced ceramics glass and sustainable fuels.