The EU bank

The European Investment Bank supports the European Commission as an agent in the implementation of the NER 300 initiative - the world’s largest funding programme for carbon capture and storage demonstration projects and innovative renewable energy technologies. A Cooperation Agreement details the respective roles of the two institutions in implementing the NER 300 Decision, notably, as far as concerns the EIB:

• the appraisal of projects submitted by Member States for funding;
• the monetisation of the 300 million allowances set aside in the New Entrants Reserve of the EU Emissions Trading System for the initiative.

Project appraisal

For details of the project application and selection process and the EIB’s role within that, please refer to the European Commission’s dedicated NER 300 website including the procedures manual. The EIB has completed its appraisal of projects submitted by EU Member States following a first call for tenders, launched Nov. 9, 2010, and has on Feb. 9, 2012, submitted the results to the European Commission. The Bank will not comment further pending the awards decisions, expected to be taken by the European Commission in the second half of 2012.

The European Commission delivered the 300 million allowances on December 2, 2011. Monetisation of a first tranche of 200 million allowances needs to be completed within 10 months from delivery, i.e. by October 2, 2012. This implies an indicative volume of sales of 20 million allowances per month. Actual monthly volumes of monetisation will be set with a view to minimise any impact on the secondary market.

The main elements of monetisation are:

• all admissible selling channels (i.e. OTC, direct screen trades, OTC exchange-cleared and auctions) are expected to be used
• phased approach starting with OTC transactions followed by transactions on selected carbon exchanges in due course
• auctions are not dependent on the infrastructure being put in place for early auctions of phase 3 allowances
• volumes will be spread as evenly as possible (available trading days will also be considered)
• settlement date is December 2013

Starting in January 2012, the EIB will provide monthly standardised reports on this page of overall sales volumes achieved and aggregated prices obtained within two weeks from each month-end. The reports can be found in the “News” section at the bottom of this page.

As regards timing of the second tranche of 100 million allowances, the EIB and the EC agreed that decisions on timing will be based on a review of experience in selling the first 200 million allowances. Sales of the second tranche may therefore not continue immediately after the first tranche is finalised and may  only be completed by end 2013. Further information on the timing of the second tranche will be provided on this website once decisions have been taken.

View the answers to "Frequently Asked Questions" on the monetisation process.