EU Bank pours cold water on fossil fuels investment
The European Investment Bank (EIB), the long-term financing arm of the European Union (EU) focused on sustainable projects around the world, has announced that it will cease investment in fossil fuels projects by the end of 2021. Since 2014, the EIB has invested over €65bn in renewable energy, energy efficiency and energy distribution.
In a 14 November press release, the EIB laid out five principles through which it will conduct investments in the energy sector:
Focusing on energy efficiency to enable the EU’s new target under the EU Energy Efficiency Directive;
Supporting decarbonisation through investment in low and zero carbon technologies, with the goal of facilitating a 32% renewable energy share across the EU’s member states by 2030;
Increasing investment in energy decentralisation efforts, along with energy storage innovations and emobility;
Investing in grid networks to facilitate the uptake of wind and solar along with strengthening cross-border energy connections;
Supporting energy transformation outside the EU;
“Carbon emissions from the global energy industry reached a new record high in 2018. We must act urgently to counter this trend. The EIB’s ambitious energy lending policy adopted today is a crucial milestone in the fight against global warming,” said Andrew McDowell, EIB Vice-President who heads up the bank’s energy strategy, in the press release.
“Following a long discussion we have reached a compromise to end the financing by the EU Bank of unabated fossil fuel projects, including gas, from the end of 2021. I am grateful for all those who have contributed to the largest ever public consultation on EIB lending in recent months and energy expert colleagues who have outlined how the EU bank can drive global efforts to decarbonise energy.”
Werner Hoyer, President of the EIB, added: “Climate is the top issue on the political agenda of our time.
“Scientists estimate that we are currently heading for 3-4°C of temperature increase by the end of the century. If that happens, large portions of our planet will become uninhabitable, with disastrous consequences for people around the world. The EU bank has been Europe’s climate bank for many years. Today it has decided to make a quantum leap in its ambition.
“We will stop financing fossil fuels and we will launch the most ambitious climate investment strategy of any public financial institution anywhere.” Stressing the need for cooperation, he added: “I would like to thank the shareholders of the bank, the EU Member States, for their cooperation over the past months.
“We look forward to working closely with them and with the EU Council of Ministers, with the European Commission, the European Parliament, international and financial institutions and, crucially, with the private sector, to support a climate neutral European economy by 2050.”