T&E also calls for switching from spending on traditional infrastructure like roads and airports to new energy infrastructure like grids and charging, which are key to decarbonizing road transport.

Public support for EV social leasing, green fuels, battery manufacturing, and charging infrastructure would help to unleash seven times that (€271 billion) every year in private spending on green tech in Europe up to 2030, the study finds. Total private and public investment rises to €507 billion a year by 2040, as the shift to green transport technology gathers pace.

The bulk of the investment (87%) in green transport technology manufacturing will come from private investors, including manufacturers and banks. But the most capital-intensive industries and energy infrastructure will need public support. T&E puts this number at €39 billion a year for manufacturing until 2030, which is less than the €42 billion that European governments give away in subsidies for petrol and diesel company cars every year.

T&E calls, among other things, for a €25 billion-backed EU battery fund to support European battery manufacturing, which is under intense pressure from China. This would provide public funding for scaling local battery production, accessing key materials, and de-risking investments in key components such as cathodes.

Similarly, e-fuels for planes and ships are currently expensive and are still in the early stages of their development. Investors are therefore reluctant to take risks and Europe is way short of the total €86 billion in capital investments needed by 2030 to kickstart their production across Europe. T&E calls on governments to deliver a third of this funding via guarantees and loans to de-risk private investments in clean fuel production.

Large public investments in particular are also needed to modernise Europe's energy infrastructure to ensure grids can meet the additional demand from millions of electric-powered vehicles. T&E calls on governments to double their current investments in grids to reach €67 billion a year until 2050. This can be offset by limiting the €61 billion that European governments spend on road building, which, if halved, would be enough to match the additional needs for grids.