 EUROPE MUST bridge a Euro 2.2trillion (?1.9trn) "carbon capital chasm" if it is to meet 2020 carbon emissions reduction targets.  The EU needs to invest Euro 2.9trn in changes to its buildings, energy and transport infrastructure to reduce emissions. and given the state of public finances most of that will have to come from financial institutions, a study from accenture and Barclays Capital said.  The headline number is equivalent to about 2 per cent of Europe's GDP, while finance to the low-carbon sector has fallen by around three-quarters since before the global financial crisis. But with tweaks to government policy and new financial instruments such as "green bonds", the 2020 target can still be met, accenture's managing director of sustainability, Peter Lacy said.  "The problem is that because of the downturn capital flow trends are heading in the wrong direction," he said. "But if governments and financial institutions get behind this, then there's room for cautious optimism."  In part the situation reflects investor concerns over policy uncertainty. But there has also been an impact from some of the financial reforms in the wake of the global crisis that militate against riskier investment by banks.  To break the jam governments must implement long-term financial incentives - such as capital gains tax credits for low-carbon investments - as well as continuing support for subsidies such as feed-in tariffs (rewards for producing green electricity) and green car grants.  The study said Europe needs a secondary market in "green bonds" - constructed by securitising debt from the low-carbon sector - to unlock capital. Partnerships between banks and technology companies, and the creation of new advisory services within the financial institutions would also help.  Mr Lacy said: "Early action comes with a premium not only in terms of the carbon targets, but also in terms of Europe becoming a leader in global low-carbon finance."