Alternative Financing for a Sustainable Energy Transition: An Institutionalist Perspective

Abstract

This article adopts an institutionalist perspective in order to address the energy transition process and to consider, in particular, the alternative financing mechanisms that would be able to support a structural transformation that is sustainable in the long term. It argues that such a transformation can be regarded in a holistic and broader way as an eco-transition process that involves the whole society and economy and requires a societal public organization. A relevant holistic approach to eco-transition should focus on the institutional conditions that are required for a new sustainable and structural change framework. In this aim, the article points to the features of the transition process that display the characteristics of a public good. The durable provision of such a good calls for the transformation of the financing schemes in force to support green investments beyond the usual opposition between market-friendly and government-guided economic policies. A relevant avenue is to organize the financing of the eco-transition under the supervision of public institutions even though the contribution of private bodies might be valuable according to the rules of long-term non-speculative financial support of markets.