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Climate change is a serious concern for Europeans and Europe aims to become the first climate-neutral continent by 2050. This requires a rapid transformation of the energy sector. Immediate and decisive action is necessary. The European Commission presented the European Green Deal, an ambitious package of measures for a sustainable green transition, showing how Europe can lead the world to climate neutrality.
The European Investment Bank, the EU bank, is committed to this vision. With its ambitious Energy lending policy, the EIB sets a milestone in the fight against climate change. We have decided to phase out the financing of unabated fossil fuel energy projects, including natural gas, by the end of 2021.
Unlocking energy efficiency investments
Investment in energy efficiency, especially in residential buildings, needs to double in volume during the coming decade. Despite numerous policy measures, a persistent investment gap remains.
Given the pressing need to accelerate market uptake for energy efficiency measures, the EIB will consider financing up to 75% of project costs. In cooperation with the European Commission, we will establish a European Initiative for Building Renovation (EIB-R) to support new ways to finance building rehabilitation.
Decarbonising energy supply
The European Union must more than double its renewable energy capacity, in order to decarbonise its energy supply and meet its 2030 renewable targets.
The EIB, in close collaboration with the European Commission and other partners, will support the market integration of renewable electricity projects and promote increased regional cooperation. We will also back other types of renewables (renewable heating), the production and integration of low-carbon gases (such as hydrogen) and low-carbon fuels.
Supporting innovative low-carbon technologies
A key cornerstone of the energy transformation is the possibility of benefitting from the contributions of a wide portfolio of energy technologies and services. Many of these technologies are still at the RDI stage and need to achieve substantial performance and cost improvements.
New investment opportunities in power markets are emerging, often associated with new business models that respond to improvements in market design. New participants are entering the market, consumers are becoming more active and communities are set to play an increasing role.
The Bank will continue to support innovation on low-carbon technology from the earliest stage in the research laboratory to the demonstration of pre-commercial technologies. Our work is closely aligned with the EU Strategic Energy Technology Plan and the new Innovation Fund under the Emissions Trading Directive. We will also support initial commercial production lines related to breakthrough technologies and new types of energy infrastructure to stimulate their market uptake.
Investing in more secure enabling infrastructure
For the electricity market, the energy policy framework adopted in 2018 confirms an interconnection target of 15% of installed capacity for 2030. Besides interconnections, investment in national electricity networks is likely to remain high for the next decade, both at transmission and distribution level.
The EIB will continue to support the development of electricity networks, including the interconnection target agreed for 2030 and European Projects of Common Interest (PCIs). It will look to prioritise investments that increase network flexibility.
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