D2.3 ClimaGen Financial Concepts 1

The deliverable, D2.3: ClimaGen Financial Concepts 1, provides the first analytical basis for the ClimaGen Finance workstream. It establishes an initial understanding of the participating cities’ project maturity, financial readiness, delivery models, funding status, and key gaps affecting implementation, scale-up, and replication of ClimaGreens. The report is based on the first round of Project Maturity Level (PML) self-assessments, follow-up discussions with cities, and a cross-cutting analysis of financing and delivery themes.

The assessment shows clear differences between Demonstration and Replication Cities. Demonstration Cities are generally more advanced, showing stronger project definition, implementation planning, and funding visibility. Results from Replication Cities indicate earlier-stage concept development and funding pathway exploration. This reflects the ClimaGen structure, where Demonstration Cities are expected to implement a 25% increase in newly created or restored public green spaces during the project, while Replication Cities focus on planning and preparing future implementation.

Across the portfolio, the dominant model is public investment for public benefit. Most interventions are municipally led, grant-supported, and expected to remain publicly owned and operated. Municipal budgets, ClimaGen funding, other EU-funded projects, and public programmes are the main funding sources. Repayable finance, such as loans, guarantees, bonds, or structured blended finance, is limited at this stage. Most projects are not designed around direct revenues, meaning their financial logic depends on public value, avoided costs, wider co-benefits, and the case for long-term investment in nature-based solutions.

Common gaps include limited clarity on costing and the need to clarify who pays, owns, operates, and maintains interventions over time. Cities also recognise important co-benefits, including resilience, biodiversity, wellbeing, public health, social inclusion, and avoided grey infrastructure costs, but these are not yet sufficiently quantified to support stronger financial decision-making. Institutional risks, including procurement, permitting, stakeholder coordination, and cost overruns, also require further attention.

The city assessments also reveal distinctive features that can inform future financial concepts. These include developer-linked co-investment mechanisms in Gdańsk, community stewardship potential in Tartu, public-community delivery in Torino, multi-actor area transformation in Trondheim, urban–rural corridor planning in Cluj-Napoca, cost-sharing across public and private areas in Eindhoven, heat-resilience and health-benefit framing in Gernika, and an emerging PPP-linked redevelopment context in Thessaloniki.

The next phase of ClimaGen Finance will build on this baseline through targeted support to cities across the various priority workstreams identified so far. These findings will inform the continued development of tailored ClimaGen Financial Concepts in D2.5 and D2.7, supporting cities to move from project ambition towards clearer, more fundable, and more financeable pathways for implementation, scaling, and replication.