Taxonomy-aligned capital expenditures (capex) from large listed European companies grew by a third in 2023, reaching €250 billion (US$271 billion) by year end, according to a new report from the Platform on Sustainable Finance (PSF). Half of this was directed toward enabling activities, while transitional activities accounted for 11% of the total (double the previous year). According to the report, debt financing remains the dominant source of sustainable investment flows, with green European bond issuance exceeding €200 billion every year since 2021. Outstanding green loans stood at €908 billion in 2023 while green bond volumes reached €781 billion. Total outstanding green debt finance at the end of 2023 was €1.7 trillion. Nonetheless, the PSF says there is still a significant investment gap, requiring at least 7-8% of GDP annually to be directed toward green investments if 2030 and 2040 climate targets are to be met. The largest gaps remain in industrial decarbonisation, energy supply, and building renovations, says the PSF.
