The Role of Green and Transition Finance in Achieving Carbon Neutrality and Sustainable Energy
- 1st Edition - March 7, 2025
- Editors: Suk Hyun, Farzad Taghizadeh-Hesary, Inhyung Lee, Bing Xu
- Language: English
- Paperback ISBN:9 7 8 - 0 - 4 4 3 - 2 4 7 3 6 - 1
- eBook ISBN:9 7 8 - 0 - 4 4 3 - 2 4 7 3 7 - 8
The Role of Green and Transition Finance in Achieving Carbon Neutrality and SustainableEnergy offers a thorough yet accessible exploration of a vital, often overlooked aspect of… Read more
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Energy offers a thorough yet accessible exploration of a vital, often overlooked aspect of the energy transition. Authored by leading experts, this book is organized into three sections: fundamentals of green and transition finance, their role in achieving carbon neutrality and ESG goals, and the policies that drive the energy transition.
Readers will gain insights into financial instruments and mechanisms influencing global financial markets and the energy sector, focusing on ESG factors. This book covers strategies that support sustainable, green, and net-zero innovations and includes diverse tools, case studies, and global perspectives to help readers design policies, model outcomes, and track progress.
From foundational theory to complex, country-level case studies, this book is an essential guide for students, policymakers, and researchers in energy and financial markets. Written in clear, policy-oriented language, it suits readers from diverse backgrounds.
Energy offers a thorough yet accessible exploration of a vital, often overlooked aspect of the energy transition. Authored by leading experts, this book is organized into three sections: fundamentals of green and transition finance, their role in achieving carbon neutrality and ESG goals, and the policies that drive the energy transition.
Readers will gain insights into financial instruments and mechanisms influencing global financial markets and the energy sector, focusing on ESG factors. This book covers strategies that support sustainable, green, and net-zero innovations and includes diverse tools, case studies, and global perspectives to help readers design policies, model outcomes, and track progress.
From foundational theory to complex, country-level case studies, this book is an essential guide for students, policymakers, and researchers in energy and financial markets. Written in clear, policy-oriented language, it suits readers from diverse backgrounds.
- Includes global, regional, and country-level case studies, breaking down complexscenarios for practical learning
- Presents empirical work examples and study questions to support independentimplementation
- Guides the reader from fundamental financial instruments to the complex contextof energy markets and their potential for accelerating the energy transition
Graduate students, researchers, and financial and energy market experts
- Title of Book
- Cover image
- Title page
- Table of Contents
- Copyright
- Contributors
- Introduction
- Part 1: Overview of green and transition finance
- Part 2: Green and transition finance for meeting carbon neutrality and ESG goals
- Part 3: Policies for facilitating the energy transition
- Part I. Overview of green and transition finance
- Chapter 1. The state of transition finance in Korea: Framework and practice
- 1 Introduction
- 2 Path to net-zero and policy initiatives
- 2.1 Challenges facing the Korean economy
- 2.2 Energy mix roadmap
- 2.3 Policy initiatives
- 2.3.1 The Korean Green New Deal (2020)
- 2.3.2 Carbon neutrality and Green Growth Act (2021)
- 3 Significant transition risk
- 3.1 Transition sector taxonomy in Korea
- 3.1.1 Greenhouse gas reduction by SMEs
- 3.1.2 LNG and blended gas energy production
- 3.1.3 Nuclear energy production
- 3.1.4 Blue hydrogen production
- 3.1.5 Eco-friendly ship construction and introduction
- 3.2 Enhancing the effectiveness of K-taxonomy for carbon neutrality
- 4 Current state of transition finance in Korea
- Chapter 2. Japan's Green Transformation Policy challenges and ESG investments
- 1 Introduction
- 2 Current status of ESG investment in Japan
- 3 Overview of green transformation policy
- 4 Challenges for green transformation policy: ESG investments and carbon pricing
- 4.1 ESG investments
- 4.2 Carbon pricing
- 5 Challenges for green transformation policy: Energy
- 5.1 Renewable energy
- 5.2 Nuclear energy
- 5.3 Fossil fuel energy
- 6 Challenges for green transformation policy: Industry
- 6.1 R&D industry
- 6.2 Manufacturing industries
- 6.2.1 Iron and steel industry
- 6.2.2 Automobile industry
- 6.3 Small- and medium-sized enterprises
- 7 Impacts of green transformation policy on Japan's companies and economy
- 8 Concluding remarks
- Chapter 3. Role of banks and nonbanking financial institutions in accelerating ESG investments: Perspectives from ASEAN
- 1 Introduction
- 2 ESG investment: Current practices
- 2.1 Market dynamics
- 2.2 ESG investment strategies
- 2.3 ESG investment approaches
- 3 ASEAN ESG scenario
- 3.1 ASEAN economy
- 3.2 Sustainable development practices in ASEAN member countries
- 3.2.1 Environmental challenges
- 3.2.2 Social and governance challenges
- 3.2.3 Implementation of ESG practices
- 4 Proposed ecosystem for boosting ESG investment
- 4.1 The ecosystem
- 4.2 Ensuring effectiveness of the of ecosystem
- 4.2.1 Ensuring regulatory requirements
- 4.2.2 ESG system integration
- 4.2.3 Rating the ESG projects
- 4.2.4 Customized portfolio development
- 5 Conclusion and policy recommendations
- Chapter 4. State-backed structured finance: Mobilizing capital for a net-zero society through blended finance, securitization, and voluntary carbon market
- 1 Introduction
- 1.1 Background
- 1.2 Literature review
- 2 Blended finance
- 2.1 Need for blended finance
- 2.2 Role of public sector capital
- 2.3 Role of philanthropic capital
- 2.4 Limits and barriers
- 2.5 Recommendations
- 3 Securitization
- 3.1 Need for securitization
- 3.2 Role of securitization
- 3.3 Limits and barriers
- 3.4 Policywise solutions and recommendations
- 4 Financial incentives
- 4.1 Need for VCM
- 4.2 Role of VCM
- 4.3 Limits and barriers
- 4.4 Policywise solutions and recommendations
- 5 Holistic Approach—Structured Transition Finance
- 6 Conclusion
- Part II. Green and transition finance for meeting carbon neutrality and ESG goals
- Chapter 5. Unveiling the potential and perspectives of ESG investments in Vietnam
- 1 Introduction
- 2 Literature review
- 2.1 ESG investing: Definitions and impact
- 2.2 Green and transition finance: A tool to promote ESG investment
- 2.3 ESG investments in East and Southeast Asia
- 3 Analysis of ESG investments in Vietnam
- 3.1 Potential for ESG investment in Vietnam
- 3.1.1 Environmental factors
- 3.1.2 Social factors
- 3.1.3 Governance factors
- 3.1.4 Green and transition finance
- 3.2 Technology helps promote ESG investment in Vietnam
- 3.3 The impacts of the pandemic on ESG investment in Vietnam
- 3.4 Challenges for ESG investment in Vietnam
- 3.5 What can be done to improve ESG investment in Vietnam?
- 3.5.1 The role of government
- 3.5.2 The role of international efforts and collaborations
- 3.5.3 Potential areas for ESG investments in Vietnam
- 3.5.4 Learning from international experiences
- 4 Concluding remarks
- Chapter 6. What spurs ESG performance?: Evidence from Chinese capital market liberalization
- 1 Introduction
- 2 Literature review
- 3 Institutional background
- 4 Data
- 4.1 Sample
- 4.2 Main outcome variable
- 4.3 Empirical strategy
- 5 Results
- 5.1 Baseline results
- 5.2 Mechanisms
- 5.2.1 Advanced institutional investors
- 5.2.2 Availability of low-cost capital
- 5.3 Heterogeneity
- 5.3.1 Financial constraints
- 5.3.2 Ownership
- 5.3.3 Market attention
- 5.4 Business sustainability
- 5.5 Robustness
- 5.5.1 Parallel trend
- 5.5.2 Placebo test
- 5.5.3 PSM test
- 5.5.4 Corporate ESG practice
- 5.5.5 Exclude sample from SZKC
- 5.5.6 Employing ESG proxy developed by SSI
- 6 Conclusion and policy recommendations
- Chapter 7. Can venture capital coinvestments address cleantech underfunding?
- 1 Introduction
- 2 The energy transition and the financing of cleantech
- 3 VC investments in the cleantech sector: Some evidence
- 4 Research hypothesis, data, and methodology
- 4.1 Research hypothesis
- 4.2 Data and methodology
- 4.2.1 Dependent variables
- 4.2.2 Independent variables
- 4.2.3 Control variables
- 4.2.4 Descriptive statistics
- 5 Empirical results: Fund-level analysis
- 5.1 Empirical results: Company-level analysis
- 6 Conclusions and policy recommendations
- Chapter 8. Bridging the climate finance gap in China: Information challenges
- 1 Introduction
- 2 Understanding climate finance
- 3 State of green and transition finance in China
- 4 Theories of finance and investment
- 5 Importance of information
- 6 Information issues for China
- 6.1 Definitions and standards
- 6.2 Disclosure and reporting
- 6.3 Evaluation issues
- 7 Private risk reduction and blended finance
- 8 Conclusion and policy recommendations
- Part III. Policies for facilitating the energy transition
- Chapter 9. Role of the inflation reduction acts in financing hydrogen energy projects: Opportunities and challenges
- 1 Introduction
- 2 Literature review and hypothesis
- 2.1 What is green hydrogen: The fuel of the future
- 2.2 Green finance on environment investment in three countries
- 2.2.1 Case 1: The IRA's clean hydrogen production tax credits in the United States: What is driving the high level of interest in this particular tax credit?
- 2.2.2 Robustness analysis: IRA scenario analysis
- 2.2.3 Case 2: EU green deal industrial plan
- 2.2.4 Case 3: India green hydrogen policy
- 3 Effectiveness of the inflation reduction actions in promoting the energy transition
- 3.1 Financial incentives and market signals
- 3.2 Technological advancement and industrial decarbonization
- 3.3 Economic and environmental impacts
- 3.4 Case studies and empirical evidence
- 3.5 Conclusion
- 4 Methodology and empirical results
- 5 Conclusion and policy recommendations
- 5.1 Policy recommendations for green hydrogen and transition finance
- 5.2 Conclusion
- Chapter 10. The role of governments in unlocking private investments in green energy projects
- 1 Introduction
- 2 Barriers to private investment in green projects
- 2.1 Financial barriers
- 2.1.1 Lack of access to long-term investment
- 2.1.2 Risk of default
- 2.1.3 Low return on investment
- 2.2 Nonfinancial barriers
- 3 How can the government unlock private investment in green energy projects?
- 3.1 Overarching policy support
- 3.1.1 Renewable energy targets
- 3.1.2 Feed-in tariffs
- 3.1.3 Tax incentives
- 3.1.4 Standards
- 3.2 Public financing instruments
- 3.2.1 Lending (debt)
- 3.2.2 Green bonds
- 3.2.3 Subsidies and grants
- 3.2.4 Equity investment
- 3.2.5 Insurance and loan guarantees
- 3.2.6 Public–private partnerships
- 4 Capacity building and skill development
- 5 Supportive policies to unlock private investment for green projects in Iran
- 6 Conclusion and policy recommendations
- Chapter 11. A progress of renewable energy transition finance in ASEAN
- 1 Introduction
- 2 Literature review: Transition finance within renewable energy transition policy design and financing system
- 3 Methodology
- 4 Financing renewable energy transition in ASEAN
- 4.1 Regulation and political commitment of AMS toward renewable energy transition
- 4.2 Implementation of renewable energy financing
- 5 Discussions
- 5.1 The presence of green taxonomies and sustainable finance roadmap in ASEAN
- 5.2 Attractiveness of ASEAN financing landscape
- 5.2.1 Financing instrument
- 5.2.2 Financing environment
- 5.2.3 Financing channel
- 6 Conclusion
- Chapter 12. Green finance for energy transition, energy poverty alleviation, and energy security
- 1 Introduction
- 2 Literature review
- 2.1 Overview of energy poverty and its dimensions
- 2.2 Concepts and indicators related to energy security
- 2.3 Inclusive financial development and its relevance to energy access
- 2.4 Existing research on the relationship between inclusive financial development, energy poverty, and energy security
- 3 Methodology and empirical results
- 3.1 Data and variables
- 3.2 Unit root test
- 3.3 Panel cointegration analysis
- 3.4 Fully modified ordinary least squares regression analysis
- 4 Concluding remarks and policy implications
- Chapter 13. Assessing the progress and challenges in transition finance: Comparative insights from Japan and Europe for Korea
- 1 Introduction
- 2 Transition finance in Europe
- 2.1 Transition finance: Enabling carbon neutrality in hard-to-decarbonize sectors
- 2.2 EU taxonomy and regulations
- 2.3 EU's framework for transition finance
- 3 Transition finance in Japan
- 3.1 Japan's transition finance: Enabling carbon neutrality
- 3.2 Guidelines for transition finance
- 3.3 Limitations and challenges of transition finance
- 4 Classification for transparent and effective transition in Korea
- 4.1 Korean green taxonomy: Guiding sustainable economic activities for carbon reduction
- 4.2 Transition sectors in Korea
- 4.3 Adopting and enhancing transition finance frameworks: Insights from the EU and Japan
- 5 Summary and implications
- Index
- No. of pages: 372
- Language: English
- Edition: 1
- Published: March 7, 2025
- Imprint: Elsevier
- Paperback ISBN: 9780443247361
- eBook ISBN: 9780443247378
SH
Suk Hyun
Suk Hyun is a Head Professor of the Graduate School of Environmental Finance at Yonsei University, Japan, with expertise in international finance, bond markets, and the Japanese economy. Before his current position, he worked as a visiting scholar at the University of Southern California and as a research fellow at the Korea Capital Market Institute. He also served as a bond market specialist at Japan Bank for International Cooperation in Japan and as an economist at the Bank of Korea. His recent research focuses on infrastructure bonds, green bonds, capital market development, and financial integration in Asia.
Affiliations and expertise
Head Professor, Graduate School of Environmental Finance, Yonsei University, JapanFT
Farzad Taghizadeh-Hesary
Dr. Farzad Taghizadeh-Hesary is an economics and finance associate professor at Tokai University in Japan. He is the co-founder and vice president of the International Society for Energy Transition Studies (ISETS), Editor-in-Chief of the Journal of Environmental Assessment Policy and Management (World Scientific), and associate editor of several academic journals. He has authored over 350 peer-reviewed journal papers and book chapters and edited 25 books by major publishers in various fields, including green finance and sustainability, energy economics, and policy. He was included on Clarivate’s list of Highly Cited Researchers. In 2023, he received the Commendation and Medal for Science and Technology from the Minister of Education, Culture, Sports, Science, and Technology of Japan for his outstanding research achievements. He holds a Ph.D. in economics from Keio University, Japan.
Affiliations and expertise
Associate Professor of Economics and Finance at the Tokai Research Institute for Environment and Sustainability, Tokai University, Japan. He also serves as the Vice President of the International Society for Energy Transition Studies.IL
Inhyung Lee
Inhyung Lee is a Senior Research Fellow and former Vice President at the Korea Capital Market Institute in Seoul, Republic of Korea, where he led the sustainability research agenda on ratings and disclosure, delivered research papers for the public, and conducted commissioned consultation research for the Financial Services Commission and the Korea Exchange. He also led market structure research for the FSC, evaluated high-frequency trading effects on the Korean Exchange market quality, and led macroprudential policy research for various organizations in the aftermath of the Global Financial Crisis. Additionally, he has held positions at FnGuide, the University of Suwon, and LG Business Research.
Affiliations and expertise
Senior Research Fellow, Korea Capital Market Institute, Republic of KoreaBX
Bing Xu
Bing Xu is a Professor of Finance at the Edinburgh Business School and the Economics & Business theme lead of the Heriot-Watt University NetZero Global Research Institute. She is passionate about working on multidisciplinary projects on low-carbon fuels, sustainable cold chains, and circular chemical economy, which are recognized as central to achieving net zero. Currently, Bing leads on the "Policy, Society and Finance" theme of work on several multidisciplinary UKRI-funded projects to address non-technological barriers around business and finance models, social dynamics, multi-criteria decision-making analysis, and policy, such as Zero Emission Cold-Chain (EP/V042548/1); GREEN-ICEs (EP/T022701/1); Sustainable Cold-Chain (UKERC); UKRI Interdisciplinary Centre for Circular Chemical Economy (EP/V011863/1); Digital Circular Electrochemical Economy (EP/V042432/1); CCUS for UK cluster decarbonization (IDRIC Wave 2).
Affiliations and expertise
Professor of Finance, Edinburgh Business School, UKRead The Role of Green and Transition Finance in Achieving Carbon Neutrality and Sustainable Energy on ScienceDirect