France Will Invest €20b in Energy Transition by 2022

The French government plans to invest €20 billion ($23.5 billion) in an energy transition plan, including €9 billion toward improved energy efficiency, €7 billion for renewables and €4 billion to precipitate the switch to cleaner vehicles.

The environment-related investments, drafted by economist Jean Pisani-Ferry and presented by French Prime Minister Edouard Philippe on Monday, are part of a €57-billion investment plan to run from 2018 to 2022, Reuters reported.

Buildings are responsible for 20% of greenhouse gas emissions, so the government plans a €9-billion thermal insulation program that will focus on low-income housing and government buildings, the government said in a statement.

“The number of badly insulated low-income housing and social housing will be divided by two and a quarter of government buildings will be renovated in line with environmental norms,” it said.

The program is aimed at financing the renovation of 75,000 dwellings per year, or 375,000 over the government’s five-year term.

The government will also invest €7 billion to boost the growth of French renewable energies by 70% over the next five years. Investments will include research and innovation to combat climate change and speed up France’s transition to low carbon and greater energy efficiency.

While efficiency investments will be a boon to the housing sector, the resulting lower power demand will hurt utilities, although the industry should also benefit from more support for renewable power.

The plan will also invest €4 billion in the switch to less polluting vehicles, with the transport industry responsible for a third of greenhouse gas emissions.

Further elements will focus on the road and railroad networks, boost local transport networks and help low-income households to exchange old, polluting vehicles for newer, more environmentally friendly models.

The plan will target the phasing out of 10 million old vehicles and focus on cars with gasoline engines registered before 1997 or diesel vehicles registered before 2001.