Low-carbon pathways

Low-carbon pathways are strategic plans designed to reduce greenhouse gas emissions and transition towards a more competitive and climate-resilient economy. These pathways set out the critical decarbonisation technologies, financing and policy needs that are required to facilitate their adoption. Their recommendations are based on extensive engagement with sector associations, policymakers, technology providers and financiers, as well as rigorous modelling exercises.

Low-carbon pathways can cover the entire economy (as in the case of nationally determined contributions or long-term strategies), specific sectors and areas, or individual clients. Sectoral low-carbon pathways outline emission levels across the entire sector, identify ways to reduce emissions in line with the country’s climate commitments (in accordance with net-zero targets, for example) and establish a timeline for decarbonisation. They also consider the impact that decarbonisation has on the broader economy and can inform the design of economy-wide climate plans such as nationally determined contributions and long-term strategies. At client level, low-carbon corporate strategies integrate climate change into the company’s strategic, financial and technological decision-making. These strategies establish climate baselines, assess climate risks, detail climate governance processes and set climate targets.

The EBRD supports policymakers and clients with all aspects of developing and implementing low-carbon pathways. The Bank provides technical support and expertise for analytical work that informs the preparation of baselines and models. Leveraging its extensive network of partners and stakeholders, particularly in the private sector, the Bank also facilitates knowledge-sharing and capacity-building activities. The Bank helps policymakers to analyse existing policies, identify roadblocks and formulate policy reforms.

Low-carbon pathways can be critical enablers of private finance. The stakeholder engagement process allows for an informed dialogue between policymakers and the private sector on technology and investment needs.

Clear and robust low-carbon policies provide the regulatory certainty and market signals that are necessary to attract private investment. By demonstrating a strong commitment to reducing emissions and transitioning to a low-carbon economy, governments can create an enabling environment that encourages private-sector participation in climate projects. Moreover, well-defined low-carbon pathways help to identify investments and policy actions that are required in the fields of renewable energy, energy efficiency and green technologies, making it easier for private investors to allocate capital to these areas.

In addition to guiding the market, low-carbon pathways can be the analytical basis and implementation roadmap for country-led investment platforms that seek to mobilise private finance, such as the Türkiye Industrial Decarbonisation Investment Platform (TIDIP). The TIDIP platform is based on the low-carbon pathways for Türkiye’s steel, aluminium, cement and fertiliser sectors, which were prepared with the EBRD’s support and adopted by Türkiye in line with its goal of reaching net-zero by 2053.