We support the transition to a low-carbon, environmental friendly and climate-resilient economy. As the EU bank, we understand the need to promote environmental goals in both developed and developing countries in order to support sustainable development around the world. As one of the largest providers of climate finance worldwide, we commit at least 25% of our lending portfolio to low-carbon and climate-resilient growth. Our funding supports sustainable projects in over 160 countries and acts as a catalyst to mobilise private finance for climate action, encouraging others to match our long-term investment. Our 2015 financing represents around 26.5% of our total lending or EUR 20.6 billion, our biggest ever annual investment in climate action.
Approach to climate action
We integrate climate action considerations throughout the methods and processes that we use to assess and monitor all our investment projects. This is what we call mainstreaming.
At the preparation stage we screen projects by analysing the following:
- Adjusted economic and financial rates of return: When appraising the economic case for a project resulting in a significant change of greenhouse gas emissions (GHG) we incorporate an economic cost of carbon.
- Carbon footprint: An assessment of GHG emissions of the investment projects we finance is carried out based on sector-specific methodologies.
For all fossil fuel generation projects, a specific Emissions Performance Standard is applied in order to screen out investments whose carbon emissions exceed a threshold level.
- Climate change vulnerability: For projects, sectors and areas particularly vulnerable to climate change impacts, we require the promoter to consider climate risks and to incorporate adaption measures into project design and operation.
- Carbon credit potential assessment: The potential of a project to generate tradable carbon credits is assessed. Technical assistance can be provided to promoters to help them exploit this potential.
At the COP 21 global leaders have to agree how to tackle climate change and how to pay for it. We at the EIB have an important role to play as the world’s biggest provider of Climate Finance. Our long track record in financing projects and initiatives in the fields of climate and development both in Europe and in emerging economies will stand us in good stead as we enter into discussions in Paris in late November/early December.
Our internal carbon footprint
In addition to the carbon footprint methodologies we have developed to measure absolute greenhouse gas emissions generated by the projects we finance, we are also committed to minimising our internal carbon footprint as one of our corporate responsibility objectives. The progressive reduction of our carbon footprint is one of our sustainability objectives.
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Rooftop solar systems on the Croatian island of Lošinj in the Adriatic Sea are producing emission free electricity for around 100 households. The project was funded by EIB partner Privredna banka Zagreb under the Green for Growth Fund.
To support the Poland’s ambitious renewable energy plans, we provided a PLN 178 million (EUR 45 million) loan for the construction and operation of a wind farm, located on two sites to the east and west of the village of Margonin. The windfarm produces enough electricity to meet the demand of about 55 000 households and accounts for 5% of Poland’s total installed wind capacity.
We are partnering with others to unlock further investment in climate and environmental projects. Our traditional financing products are medium and long-term loans with fixed or variable interest rates in euros or other currencies. We finance large projects with direct Project loans whereas we support smaller projects indirectly, through credit lines to local banks or other intermediaries. We complement our traditional lending with innovative finance products:
- Tracking Climate Co-Finance: Approach Proposed by MDBs
- Joint Report on MDB Climate Finance 2014
- Joint Report on MDB Climate Finance 2013
- Joint Report on MDB Climate Finance 2012
- Joint MDB Report on Adaptation Finance 2011
- Joint MDB Report on Mitigation Finance 2011
- International Financial Institution Framework for a Harmonised Approach to Greenhouse Gas Accounting
- Bilateral Finance Institutions & Climate Change - A Mapping of Public Financial Flows for Mitigation and Adaptation to Developing Countries in 2010, UNEP EN
- Bilateral Finance Institutions and Climate Change - A Mapping of 2009 Climate Financial Flows to Developing Countries, UNEP EN