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City Hall in Etterbeek, Source: Trougnouf (Benoit Brummer) on Wikipedia, CC BY 4.0

Etterbeek in Belgium wants to use citizen savings to fund its green policies

Etterbeek in Belgium wants to use citizen savings to fund its green policies

The scheme was proposed by Mayor Vincent De Wolf to help boost budgets after these were depleted during the pandemic

According to a report by Le Soir, yesterday, the mayor of Etterbeek, a district in the Brussels Capital Region, stated that local authorities needed to find more funds for green projects. Mayor Vincent De Wolf explained that the COVID-19 pandemic has left many municipal coffers empty and ill-equipped to finance important climate change policies.

This is why he proposed a loan scheme, where private citizens will be able to invest in their local governments, specifically for sustainability projects. The scheme he outlined showed that the money would be invested into the city for a period of 5 to 8 years and promised a 1.5% to 2% dividend rate.

Tapping into citizens’ savings as an investment tool

The idea of tapping into citizen wealth, specifically for green projects is fairly unexplored, however, there are a few prominent examples from the European Union. One of the most successful case studies involves the city of Vienna and their scheme to sell shares from photovoltaic plants.

The basic idea behind that plan is to let citizens share the climate transition period and become an active part of it. On the one hand, it’s a way for the city to source quick funds and on the other, citizens who cannot make their own PV systems can take part in the green transition.

In one example, from the district of Donaustadt, a citizen solar power plant sold all of its shares for 475 euros a piece in just 26 hours - giving the city 38 million euros to build the project.

Mayor De Wolf’s idea, however, is a bit more modest. He explained that the municipality is looking for citizen investments of 15 million euros, which should help cover the city’s green projects in the next three years. These include renovations of public buildings and photovoltaic installations, which will cause energy savings and in his words “generate profits for the municipality”.

The scheme would, in essence, resemble a savings account in the city, offering similar returns. The major difference, according to De Wolf, however, is that these savings would be allocated solely for the city’s climate-policy agenda. The decision is not yet final as it needs to pass through the local government first.

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