Friday 15 November 2019
European Investment Bank to cease funding for fossil fuel projects
The European Investment Bank (EIB) has confirmed it will end financial support for fossil fuel projects from the end of 2021 as part of its commitment towards a climate neutral economy by 2050.
The board of the EU bank has agreed to no longer consider new financing for unabated fossil fuel projects, which includes coal, gas and oil, with its new energy lending policy to increase support for climate action and environmental sustainability to reach 50% of its operations from 2025.
It has pledged to support €1 trillion (£0.85tn) of investments in climate action and environmental sustainability from 2021 to 2030 and set a new Emissions Performance Standard of 250g of carbon dioxide per kWh, which will replace the current 550gCO2/kWh standard.
It has set out five principles that will govern future EIB engagement in the energy sector:
- Prioritising energy efficiency with a view to supporting the new EU target under the EU Energy Efficiency Directive
- Enabling energy decarbonisation through increased support for low or zero carbon technology, with the aim for a 32% renewable energy share throughout the EU by 2030
- Increasing financial support for decentralised energy production, energy storage and electric mobility
- Ensuring grid investment for new, intermittent energy sources like wind and solar as well as boosting interconnections across borders
- Increasing the impact of investment to support energy transformation outside the EU
EIB President Werner Hoyer said: “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.”
