World’s biggest energy lender reloads support for renewables in Europe
- 24 July 2013
LONDON: The European Investment Bank (EIB), one of the world’s biggest energy lenders, has adopted fresh guidelines in support of renewables and energy efficiency investment, which could help the EU to meet its energy and climate goals and create jobs across Europe.
Clean energy criteria
The EIB’s board members approved the proposed policy yesterday, which includes a greater focus and streamlined guidelines on energy efficiency, renewable energy, energy networks and related innovation research.
A new Emissions Performance Standard has also been introduced, in order to filter out investments that are associated with carbon emissions that exceed a certain level.
The bank has spent the past year reviewing its lending criteria to reflect Europe’s investment trends and the EU’s climate and energy policy. Mihai Tanasescu, European Investment Bank Vice President responsible for energy lending said in a statement: “Adoption of the new lending criteria represents an important step forward in the European Investment Bank’s commitment to energy investment that supports EU policy and reflects the urgent investment challenges currently facing the energy sector. Prioritising lending to energy efficiency, renewable energy, energy networks and energy RDI projects will help EU to meet its energy and climate objectives and create local employment across Europe. The new Emissions Performance Standard will ensure that outside these sectors the Bank’s energy lending makes a sustainable and positive contribution to economic growth.”
The move complements the EIB’s work over the last five years, in which funding for fossil fuel generation projects has significantly decreased. Over the same period, the EIB has provided more than EUR 70 billion (over US$92 billion) for long-term energy investment, keeping in line with both EU energy and climate policies and national energy strategies to support sustainable and secure energy in Europe.
Günther Oettinger, European Commissioner for Energy, said: “Significant long-term investment across Europe is essential to achieve our energy and climate targets and maintain a technological lead. The European Investment Bank plays a valuable role in financing public and private sector investment in energy infrastructure and supporting projects that contribute to achieving EU energy policy goals. The new guidelines provide a framework for continuing this contribution over the years ahead.”
Welcoming the World Bank’s similar move last week, in which its President Jim Yong Kim pushed forward a new clean energy lending strategy, Mark Kenber, CEO, The Climate Group, had warned the EIB to follow suit. He said yesterday: “Redirecting these substantial funds from coal plants to clean energy projects globally is a critical step towards avoiding a catastrophic 4 degree world, and keeping the rise in global average temperature below 2 degrees to avoid the worst impacts of climate change. It also means accelerating the path to a smarter, better, more prosperous future for all. [...] The policy change represents an important transition for the organization and a big opportunity for Jim Yong Kim to position the World Bank and its partners as leaders of the global clean revolution. The move is also a flashing signal for other lending institutions to follow suit. Tomorrow the board of the European Investment Bank (EIB), the world’s largest public financial institution, will also hold a vote on its energy financing policy. The EIB must follow in the World Bank's footsteps and redirect finances from coal to renewables."
Earlier this month, the EIB also issued a US$848 million ‘green bond’ to help it finance renewable energy and efficiency projects. The Climate Awareness Bond was launched in response to strong demand from asset managers, insurers and pension funds and is the largest of its type ever to have been issued in the euro market.
By Clare Saxon