The European Investment Bank (EIB), the Bank promoting European Union objectives, is reinforcing its support for cleaner energy with a landmark carbon fund and nearly EUR 450 million in fresh finance to improve energy efficiency, boost renewable energy sources and minimise greenhouse gases across Europe.
Focusing on “Investing in Energy – Mastering Climate Change” at its 2007 EIB Forum in Ljubljana on 27-28 September, the Bank also announced a renewed policy on lending to the transport sector to ensure that it targets the most efficient and sustainable ways to satisfy transport demand.
The latest moves add to the EIB’s already extensive funding for carbon and climate change initiatives, made in the context of the European Union’s new Action Plan for Energy Policy. “Energy conservation means substituting technology and ultimately capital for energy. And using alternative energies means employing technology and capital in order to exploit free and renewable sources of energy such as solar, wind, wave or geothermal resources,” EIB President Philippe Maystadt said.
“Moving towards a low-carbon economy therefore ultimately means the large-scale employment of capital. The EIB is ready to take up this challenge.”
The Forum sees the launch of the innovative European Post 2012 Carbon Fund, the first carbon fund aimed at underpinning the market value of carbon credits after the Kyoto Protocol expires in 2012. A direct result of on-going cooperation between the EIB and three leading European national financing institutions – Spain’s Instituto de Credito Oficial (ICO), Germany’s KfW Bankengruppe and the Nordic Investment Bank (NIB) – the Fund will support environmentally beneficial projects including renewable energy, energy efficiency, forestry and methane capture, by acquiring carbon credits generated in the period 2013-22. The Fund, the first signing of which is targeted at EUR 100 million, complements three other carbon funds created by the EIB with other national and international financial institutions.
The Forum also sees the signature of five new loans to support energy supply and promote renewable energy and energy efficiency across Europe:
- The EIB will lend EUR 350 million to modernise electricity generation in Slovenia. The project, for a new 600 MW steam turbine power plant in Šoštanj, will use the latest technology to cut carbon emissions from lignite-fired generation while exploiting this major local fuel resource to help meet increased energy demand and contribute to a secure electricity supply.
- The Bank will also lend EUR 30 million in the form of a framework loan to Slovenia’s Environmental Development Fund, to fund projects with a particular focus on energy efficiency and renewable energy as well as water and wastewater.
- An additional EUR 13 million will be lent to support the completion of Slovenia’s new Avče hydropower pumped-storage plant. The plant will help cut greenhouse gas emissions by using off-peak electricity to pump water at night, and reversing the flow to generate electricity at peak hours.
- Elsewhere, the EIB will invest EUR 25 million in the Enercap Power Fund, financing projects using renewable energy sources in Central and South-Eastern Europe with a focus on Hungary, Slovakia, Poland and Croatia. The Fund, to be signed subject to final legal documentation, will support projects based on the use of mature technologies in the wind sector, as well as in biofuels and other renewable energy.
- A further EUR 25 million will be invested in the DIF Renewable Energy Fund, focused on equity financing for renewable energy in North-West Europe – mainly the Netherlands, Belgium, France, Germany, Denmark and the UK. Wind projects will be the main focus, with other renewable energy projects undertaken on a case-by-case basis.
President Maystadt welcomed these initiatives and highlighted an impressive start to the Risk Sharing Finance Facility (RSFF), the latest in a series of joint EIB-European Commission initiatives, which was launched in June 2007 and has already committed funds of more than EUR 350 million. Created to provide strong additional support to research, development and innovation projects in Europe, the RSFF has already seen a firm focus on renewable energy technologies, including funding for four ground-breaking concentrating solar thermal power (CSP) generating plants in Spain.
The promotion of sustainable, competitive and secure energy is a key policy objective of the European Union. As the EU’s long-term financing institution, the European Investment Bank (EIB) made support for Europe’s energy needs a top lending priority in 2007, targeting the increase of renewable energy, energy efficiency and energy saving, research and development in energy, and security and diversification of supplies. The EIB has set itself a minimum annual lending target of EUR 800 million for renewable energy projects.
Since the beginning of 2006, the EIB has provided loans in excess of EUR 6 billion for energy investment projects within the EU, of which EUR 456 million in 2006 and already EUR 901 million in 2007 have been for renewable energy projects.
The 2007 EIB Forum taking place in Ljubljana (Slovenia) on 27-28 September will look at different world energy scenarios, assess their economic and environmental sustainability, and discuss the political choices to be made. Energy supplies and the full spectrum of energy sources, from fossil and nuclear to renewable energy, will be considered, as well as energy demand in major sectors such as the car and steel industry, energy consumption for heating and lighting, and the potential for greater energy efficiency.
Further information on the EIB’s climate change activities can be found at http://www.eib.org/climateaction.
For further details on the InnovFin, please visit: http://www.eib.org/innovfin