The European Investment Bank (EIB) signed yesterday a loan of GBP 82 million in support of an integrated waste management service for the treatment and disposal of municipal waste in Cornwall, in South-West England. This project is the first major Public Private Partnership (PPP) in the waste management sector in the United Kingdom to be funded on a limited recourse basis.

A pathfinder Private Public Partnership (PPP) in the waste management sector in the United Kingdom: EIB funds will be lent to the private sector partner, Sita Cornwall Limited, a special purpose company selected following an international call for tender. Subject to planning, it will design, build, finance and operate a new energy from waste plant, two municipal recycling plants, two landfill sites and a number of transfer stations and civil amenity sites, under a 30-year concession granted by Cornwall County Council.

The Department for Food, Environment and Rural Affairs (DEFRA) has selected this project as a pathfinder, to establish points of reference for future developments of PPPs in the waste sector in the UK. EIB was well placed to contribute to the development of the project as it has substantial expertise in financing PPPs - investing 22 billion euros in over 100 PPP projects in 14 Member States - as well as waste projects.

EIB plays an active role in promoting the environmental and regional policies of the European Union: In line with EU policies, this project will reduce the amount of waste sent to landfill and enable a more rational use of energy. The EIB devotes a third of its individual loans within the European Union to environmental projects, which over the past 5 years, has amounted to 49 billion euros. Finally, this loan will contribute to the economic and social development of Cornwall, an area which has been classified by the European Union as a convergence region (objective 1).

The European Investment Bank, the European Union's long-term lending institution, finances capital investment furthering EU integration, in particular: regional development; research, development and innovation; trans-European transport, telecom and energy networks; industrial competitiveness; SMEs, and environmental protection. It also operates outside the EU within the framework of the EU's policy for co-operation and development. Owned by its Member States, the EIB raises its funds on the capital markets (AAA-rated issuer). In 2005, it borrowed EUR 50bn and lent a total of EUR 47bn, of which EUR 42bn in the EU-25.