First, the public sector can catalyze action from other actors, such as technology producers, solutions buyers, and financial investors. Catalyzing action could take the form of financial incentives on the demand and supply side or mechanisms such as mandates or penalties, to help commit demand for climate solutions and ensure a steady revenue stream for producers. Incentives are most effective when they are accompanied with mandates that effectively commit demand.

Second, the public sector can help ensure certainty for climate investment by pushing for long-term regulatory support and ensuring a predictable and simplified regulatory environment. Regulatory certainty is required to encourage funding from financial institutions and can act as a powerful de-risking mechanism. To the extent possible, public actors should provide certainty through long-term policy commitments; such as, through longer-term tax credits or simplifying red tape (for example, through the proposed Net-Zero Industry Act, part of the Green Deal Industrial Plan). 

Finally, the public sector can set standards, such as via taxonomies, to help establish credibility for green products and services and so ensure actors are aligning to net-zero goals and avoid greenwashing concerns. Indeed, an increasing amount of regulatory activity surrounding sustainable financing has involved setting definitions and standards around the underlying economic activity being financed.