Bank of Italy Unveils Transition Plan for Net-Zero Emissions by 2050

The Bank of Italy is taking a new step on its sustainability journey and putting its climate strategy in writing, raising the bar for its environmental commitment. The Bank has published its Transition Plan for Mitigation and Adaptation to Climate Change, which defines targets, timelines, and tools to progressively reduce the carbon footprint of its business operations and strengthen resilience to climate risks.

The goal is to achieve net-zero emissions by 2050, with a 90% reduction in emissions compared to 2019 and the removal of residual emissions through permanent solutions.

This commitment comes at a complex time on geopolitical and regulatory levels, but, as Governor Fabio Panetta emphasizes, remains essential: “The goal remains to significantly reduce net greenhouse gas emissions over the next decade, reaching zero by 2050. This is a commitment we owe to future generations.” At the same time, Panetta warns, even in a scenario of successful emissions reduction, the effects of climate change will continue to be felt for decades, making adaptation and resilience policies essential.

The Plan is part of a long-standing process: since 2013, the Bank has purchased electricity exclusively from renewable sources, has invested in energy efficiency, photovoltaics, process digitalization, and sustainable mobility, and in 2025, it integrated the Environmental Report into the new Management and Sustainability Report. These initiatives are now being structured into a comprehensive strategy, monitored and updated as part of the three-year strategic planning.

The Plan concerns only the Bank of Italy’s corporate operations (excluding financial investments) and covers all major emission sources: buildings, data centers, banknote production and circulation, travel, and the supply chain. In addition to the final objective for 2050, intermediate targets are envisaged for 2035 : a 67% reduction in Scope 1 and 2 emissions and a 40% reduction in Scope 3 emissions, both compared to 2019. This approach is consistent with the Paris Agreement and the European regulatory framework, from the EU Climate Law to the Fit for 55 package.

Schematic representation of the Bank’s decarbonization targets and carbon mitigation and removal measures, the achievement of which is contingent on technological, economic, and political factors largely beyond the Bank of Italy’s control.

The Bank of Italy’s Transition Plan for Climate Change Mitigation and Adaptation

The plan is organized into six chapters: Fundamental Principles, in which the Bank of Italy outlines its final and intermediate greenhouse gas emission reduction targets through 2050, as well as the relevant regulations, international guidelines, and assumptions underlying the Plan; Climate Change Mitigation, which describes the actions the Bank intends to implement on business operations, products, and services to achieve decarbonization objectives, as well as the implications for financial planning and the cost-benefit assessment methodology for real estate and IT projects (including those not explicitly included in the Plan);

Climate Change Adaptation and Resilience, in which the Bank outlines the actions it has implemented and defines those to be undertaken to increase the resilience of its operational processes and buildings; Cooperation and Partnership , which outlines how it intends to cooperate with suppliers, other central banks, the public sector, communities, and civil society to implement the Plan, as well as the actions to be implemented beyond the value chain.

Monitoring and Metrics, which describes the data and metrics used to monitor progress towards achieving intermediate and final objectives; and finally, Governance of the Plan , which illustrates the roles and responsibilities of the Bank’s top management and organizational structures, as well as how to integrate the Transition Plan into decision-making processes.

With this Transition Plan for Climate Change Mitigation and Adaptation, the Bank of Italy is strengthening its contribution to the transition to a low-emission economy, combining environmental sustainability, management efficiency, and organizational resilience. This strategy, in Panetta’s words , looks to the long term without losing sight of the immediate challenges : reducing emissions today and preparing for tomorrow’s climate impacts.

Fundamental principles

The Bank of Italy places its strategy within the framework of European and international commitments, from the Paris Agreement to the EU Climate Law. “In Italy, the environment, along with biodiversity and ecosystems, is expressly protected by the Constitution (Articles 9 and 41),” the Bank of Italy recalls, adding, as in Italy: “With regard to climate change mitigation, the National Integrated Plan for Energy and Climate (PNIEC) defines the national greenhouse gas reduction targets for 2030 and the measures to be implemented to achieve them.” While “on the topic of adaptation, the National Plan for Adaptation to Climate Change (PNACC) provides a framework for minimizing the risks deriving from climate change.”

The decarbonization trajectory is built in accordance with international standards, from the GHG Protocol to the ESRS (European Sustainability Reporting Standards), and in line with the frameworks for transition plans. Specifically, it identifies the Scope 1, 2, and 3 emissions under its responsibility, both upstream and downstream.

The document also specifies external factors that may influence the path, such as evolving climate policies, energy price dynamics, geopolitical tensions, technological developments, and the availability of data along the value chain. The Via Nazionale Institute therefore takes a cautious approach, appearing to be “precautionary,” but acknowledging the uncertain context, it nevertheless maintains its commitment to setting clear and verifiable objectives.

Climate change mitigation

The mitigation chapter represents the operational heart of the Plan. The cornerstone of the strategy is the gradual transition from gas to electricity as the primary energy source for heating buildings , through the installation of heat pumps powered by renewable energy . This choice allows for the reduction of emissions and, at the same time, the dependence on imported fossil fuels, which are subject to highly volatile prices.

This line of intervention is accompanied by improving the energy efficiency of the buildings, many of which are historic and subject to architectural constraints, optimizing logistics and space, increasing self-production from photovoltaic systems, and using innovative tools such as long-term Power Purchase Agreements .

The Plan also addresses the life cycle of banknotes , with measures to reduce their environmental impact during the production, circulation and transportation phases.

As for the reduction of indirect Scope 3 emissions, the plan focuses primarily on the categories that contribute most to the Bank’s carbon footprint, such as the purchase of goods and services, employee and external staff commuting, and business travel.

“With regard to suppliers, 20 of them contribute to approximately 30 percent of the overall emissions associated with the purchase of goods and services,” the document states. The Bank of Italy’s actions in the coming years will be geared towards pursuing two main objectives: the first is to acquire more accurate information on the greenhouse gas emissions of purchased goods and services, starting with the categories most relevant in terms of carbon footprint; the second is to work towards a progressive decarbonization of the products and services purchased and, more generally, to orient the supply chain towards low greenhouse gas emission solutions.”

Internal carbon price

Another key element of the plan is the introduction of an internal carbon price – the cost of emitting one tonne of CO2 into the atmosphere – into investment decisions .

In practice, the Bank of Italy will begin assigning a price to the CO₂ emissions generated by its projects, such as real estate or IT projects, when the climate impact is significant. This carbon price will be integrated into traditional cost-benefit analyses, adding the climate costs of the various project alternatives to the financial cost. This way, choices are evaluated not only based on their economic cost, but also on the emissions they produce, favoring more efficient solutions consistent with the goals of the Paris Agreement.

The new methodology will be tested in 2025 on pilot projects, and then gradually extended between 2026 and 2027. From 2028, it will become a structural tool to support the Bank’s decisions and purchasing.

Adaptation and resilience

Alongside emissions reductions, the Bank of Italy is strengthening adaptation policies to address the physical impacts of climate change. The Plan includes targeted interventions on buildings and critical infrastructure , with the aim of ensuring the operational continuity of essential processes, from the functioning of the payment system to financial stability.

According to the National Strategy for Adaptation to Climate Change (SNAC), Italy is exposed to a variety of growing physical risks: from rising temperatures and heatwaves to drought, to extreme weather events such as floods, hydrogeological instability, and coastal erosion. Cities, particularly highly urbanized ones like Rome , where the Bank of Italy’s critical infrastructure is concentrated, are particularly vulnerable due to impervious surfaces and building density. For the Bank, these phenomena represent not only a risk to the safety of its staff, but also a potential threat to its buildings, infrastructure, and IT systems, including data centers.

For this reason, the Bank of Italy has initiated a targeted assessment of climate-related physical risks and has integrated these factors into its operational risk management and business continuity system, with the aim of strengthening resilience and ensuring the continuity of essential functions even in adverse climate scenarios.

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(Featured image by Enrico Frascati via Unsplash)

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