The Working Paper series presents work carried out within DG Treasury, disseminated with the aim of enlightening and stimulating public debate. The authors are solely responsible for their work.


This working paper seeks to understand the drivers of decarbonization investments by industrial firms in France. I investigate the extent to which firms’ characteristics determine the probability of engaging in green investments and the size of these investments. By mobilizing a selection model on individual panel data estimated between 2013 and 2018, I show that the adoption of decarbonization technologies increases with firm size, energy intensity, productivity, and inclusion in the ETS, and decreases with firm age. Among firms investing in decarbonization, the size of the decarbonization investments is determined by firms’ energy intensity. The analysis suggests that some highly-emitting sectors have tended to invest less in decarbonization than other sectors, providing emerging evidence that decarbonization investments should be accelerated as a priority in these sectors.