www.eib.org

The role of the European Investment Bank, an autonomous European Union (EU) institution, is to finance investment projects contributing to the balanced and sustainable development of the Union and its Partner Countries. Set up in 1958 under the Treaty of Rome establishing the European Community, the EIB operates as a bank and raises on the capital markets the bulk of the resources that it deploys to finance projects worldwide meeting the Union’s broad objectives.

In line with these objectives, the promotion of sustainable, competitive and secure energy sources and combating climate change ranks among the Bank’s top priorities.

The Bank’s policy for lending for energy seeks to promote: 

• sustainability by promoting renewable energy sources, to reduce both dependence on finite resources (such as oil, coal and gas) and the negative impacts of fossil fuels on the natural environment, particularly through CO₂ and other greenhouse gas emissions;
• competitiveness in energy supply - a key consideration for the economic development of the European Union given the central role played by energy in the modern economy;
• security of supply by promoting diversified sources of energy, reducing Europe’s dependence on external supplies and the impact of the many international risk factors that affect the energy market.

The EIB’s policy stance on energy therefore fully reflects the prominence of energy on the European Union’s policy agenda. The Commission’s Energy Green Paper of March 2006 was followed in March 2007 by the adoption of an Action Plan 2007-2009. Within this framework the EU has pledged to achieve a:

• 20% reduction of greenhouse gas emissions by 2020 compared to 1990;
• 20% share of renewable energies in the overall EU energy mix;
• 10% share of biofuels in petrol and diesel for transport;
• 20% reduction in energy consumption compared to baseline projections for 2020

Meeting these targets will be an enormous challenge.

The EIB’s contribution concentrates on five priority areas:

• renewable energy;
• energy efficiency;
• research, development and innovation (RDI) in energy;
• security and diversification of internal supply (including trans-European energy networks);
• security of external supply and economic development (Neighbour and Partner Countries).

Within its Corporate Operational Plan (COP), the Bank has established challenging targets to direct, and underscore, its contribution to energy lending:

• in 2007, a global lending target of EUR 4bn for projects belonging to at least one of the five priority areas;
• also in 2007, a minimum lending target of EUR 800m for renewable energy;

These targets will be reviewed annually.

In addition to its direct lending activities, the EIB is also playing an expanding role in a number of initiatives to combat climate change – itself a key objective of Europe’s sustainable energy policy.

In particular, the Bank is contributing to the development of carbon markets, notably the EU’s Emission Trading Scheme (ETS). The Bank is encouraging the use of Kyoto-compliant carbon project credits as a project finance instrument, thus helping private and public entities to meet their carbon compliance obligations. In this respect, the EIB has already established three carbon funds, with the EBRD, the World Bank and KfW. In addition, it has recently launched a fourth fund to promote the long-term carbon market post-2012, after the expiry of the Kyoto Protocol.

Web: www.eib.org

 

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