EUR 134 million from EIB to finance four projects under China Climate Change Framework Loan
- Release date: 30 November 2009
- Reference: 2009-236-EN
Drawing from the China Climate Change Framework Loan (CCCFL), signed with China in November 2007, the European Investment Bank (EIB) is providing a total of EUR 134 million in four operations that will contribute to the mitigation of climate change. EIB estimates that up to 830,000 tons of CO2 emissions will be avoided every year when the four projects will be fully operational. The projects are as follows:
- The transformation of the district heat system of the city of Jinan (capital of Shandong Province), which will move from steam supply to hot water supply, improving the whole automation of the system. The project will increase energy efficiency and will lead to a better use of resources, reducing both greenhouse gas emissions and water consumption. The project will almost halve heat losses by 46% and electricity consumption for the system by 48%, and will reduce water usage by 16%. With the project, the combined heat & power plants will become highly efficient and fully compliant with the respective EU Directives. The EIB provides EUR 31 million to support this project.
- The installation of street, building, landscape and lawn lighting with energy efficient lights running on renewable solar energy, in Chaoyang City (Liaoning Province). Energy will be produced by photovoltaic modules, making use of batteries for energy storage, both in stand-alone mode or integrated with network energy. The EIB provides EUR 29 million to support this project.
- 10 small scale hydropower plants, with a total capacity of 62 MW, in Yichang City (Hubei Province). The project aims at increasing the share of renewable energy in the general production mix in China. A particular focus has been brought on the environmental and social impact of these projects where mitigating measures are satisfactorily implemented. The EIB provides EUR 44 million to support this project scheme.
- The construction and operation of a sodium carbonate and ammonium chloride co-product plant, using the CO2 currently vented from the existing fertiliser complex. The project will allow the use of residual heat, waste gas streams and solid residues to produce energy, thus increasing the energy efficiency of the production facilities. The plant is located in Qiaokou Township (Hunan Province). The EIB provides EUR 30 million to support this project.
All four projects will result in a significant reduction of emissions of greenhouse gases and other pollutants, as well as improve energy efficiency, thereby contributing to the mitigation of global climate change. All projects will seek CDM (1) registration for carbon credit generation; the possible sale of carbon credits would further improve their financial situation and mitigate the extra-cost of their “green” investments.
The operations are in line with the objectives of the CCCFL and will contribute to the European Union-China Strategic Partnership, which among other things provides for joint efforts to mitigate climate change, in particular under China’s National Climate Change Programme.
Since the signature of the CCCFL in November 2007, 20 project schemes received EIB funding for a total amount of EUR 334 million (out of the EUR 500 million available under the CCCFL). Overall CO2 emission reductions will stand at 1.57 million tons every year when all schemes will be fully operational.
The European Investment Bank is the EU’s long-term financing institution promoting European objectives. Set up in 1957, the EIB operates in the 27 EU Member States and more than 130 other countries in Asia and Latin America, the Balkans, the Mediterranean region, Africa, the Caribbean and the Pacific. Lending operations outside the EU are part of EU cooperation policy with third countries.
Under the current Asia and Latin America mandate (ALA IV), covering the period 2007-2013, the EIB is authorised to lend up to EUR 3.8 billion for financing operations that contribute to climate change mitigation or support the EU’s presence in those regions through foreign direct investment or the transfer of technology and know-how. The EUR 3.8 billion regional ceiling is broken down into indicative sub-ceilings of EUR 1 billion for Asia and EUR 2.8 billion for Latin America.
In addition to the mandate, the Bank is running a Facility for Energy Sustainability and Security of Supply (ESF), a multiannual EUR 3 billion facility aiming to reinforce the EIB’s contribution to renewable energy and energy efficiency in non-member countries. CCCFL was authorised under ESF.
(1) Clean Development Mechanism