original topic of my talk ( which has in any case been addressed by other speakers here today ). about this i will only say, very briefly, 17 that ‒ in addition to investors ’ acceptance ( and there seems to be no lack of this, given the rapid development of ‘ green ’ investment instruments in recent years ) ‒ for environmental finance to expand in a sustained manner, access to data of sufficient quality ( taxonomies, audits and so on ) is essential ; the lack of it would undermine efficient selection and lead to a considerable risk of greenwashing. it is also important that banks and institutional investors become aware of the need to manage environmental risk effectively, among others. efforts are being made on both fronts, especially at european level. 18 let me make an observation on this point, however, that i think is fundamental. in a market economy, even more than taxonomies and prudential rules, what really counts are relative prices, a key tool for allocating resources efficiently. as is now widely acknowledged, it would be quite difficult for a transition strategy to work without carbon pricing : without, that is, incorporating into the price of fossil fuels the damage that they cause to the ‘ common good ’, 19 i. e. in economic jargon, the negative externalities associated with their use. 20 rendering human activity ‘ climate neutral ’ ‒ a prerequisite for limiting the temperature increase to 1. 5 - 2°c, pursuant to the solemn commitment made with the signing of the paris agreement21 ‒ means setting prices that encourage a more efficient use of energy, and, in particular, choosing a relative price that makes fossil fuels less affordable than alternative fuels, thereby favouring the development of low - emission technologies. we would ideally like carbon pricing to follow a gradual and predictable path, the result not of exogenous and unpredictable factors, but rather of explicit economic policy decisions ( rates, grants, market rules ), carefully evaluated, credible and ( not least ) consistent at global level. a gradual and predictable path will make it easier for investment and consumption decision makers to further the transition. a fiscal component ( which is only one of the possible ways to achieve carbon pricing22 ) is useful for redistributing the cost of the transition and mitigating its impact on households, firms and the worst affected areas. 23 global cohesion is important in order to avoid unfair competition and the leakage of emissions from one jurisdiction to another : carbon knows no borders.

triggering a reaction that, in a more or less short space of time, could result in energy savings and / or a conversion to alternative resources. raise your hands those of you who, if you have had the chance to, have not thought in recent weeks about reducing your future consumption of fossil energy sources at home or in the office, for example by installing solar panels or using other renewable sources? how much will be saved and how long it will take, we do not know ; but it would be surprising if the effects were insignificant. in the years following the two great oil shocks, italy became one of the most energy efficient countries in the oecd : between 1970 and 1995, the energy intensity of italian gdp fell by almost 30 per cent. after the exogenous shock, energy prices remained high in italy, in part due to it having among the highest taxes on energy products in the eu. 26 the prices were a key signal for improving energy productivity, which had stalled prior to the oil crisis. 27 there are certainly some differences between now and then ; among other things, the energy component of gdp has continued to fall over the last thirty years, in part due to the growth in services to the detriment of manufacturing ; moreover, at this moment in time, we do not know how permanent the increases that we are experiencing will be. the example of the 1970s cannot therefore be interpreted as a qualitative estimate of the possible effects of the current shock. however, there are also more than a few similarities ; qualitatively speaking, the effects could be considerable. all this, provided that it is recognised that, aside from emergency measures taken to smooth temporary ‘ bumps ’, public intervention aimed at mitigating the effects of the crisis should, more than it already has, take the form of income relief for those most affected and of support for the transition, rather than fighting price increases. we must certainly help those in difficulty, but we should also leave the signal of relative prices to function to the extent reasonably possible, just as we essentially did in the 1970s. we must also remember, and we should remind the public, that in order to achieve the climate transition goals, fossil fuel prices still have to rise, and rise a lot, no matter how much the estimates of the exact end point may vary. this action must be accompanied ( as we have already started to do ) by every possible incentive, including regulatory ones, to turn to alternative sources, with a view both