24 February 2011
Climate loans made up 30% of the European Investment Bank’s (EIB’s) lending in the EU last year, with the development bank financing €20.5 billion ($28.2 billion) of projects involving renewable energy, energy efficiency, sustainable transport, forestry, innovation and climate adaptation.
This was up from €16 billion of climate loans in 2009, the EIB said yesterday, releasing its annual lending report.
Sustainable transport projects took the largest slice of the pie, with €7.9 billion, or nearly 40%. Another €6 billion went to financing renewable energy projects and €2 billion to energy efficiency projects. By contrast, the EIB loaned €440 million to coal and lignite power projects and €1.3 billion to natural gas power projects.
“We have succeeded in our mission to support recovery in Europe by financing projects that stimulate growth, innovation and jobs, and we are very proud of our record volume on climate action projects,” said Philippe Maystadt, president of the EIB. “Building a better and more sustainable future is the driving force behind everything we do.”
The UK’s giant offshore wind project, the London Array, received the largest single ‘climate action’ loan last year, for €842 million.
Although the EIB’s primary mandate is development within the EU, it financed €2 billion of climate action projects elsewhere in the world last year and expects to increase this financing in the next three years. This ranges from large pots of money distributed via local financial institutions, such as €500 million for climate change mitigation projects in China, to smaller deals, such as a €79 million loan to Iberdrola for construction of a wind farm in Oaxaca, Mexico.
Funding for the bank’s energy sustainability facility – which allows it to make loans to projects outside the EU in 'investment grade' countries – has been increased by €1.5 billion to €4.5 billion and the European Parliament and Council are in discussions over a €2 billion climate mandate, also to be spent outside the EU.
To meet the bank’s criteria for a ‘climate action project’, a project must meet the EIB’s criteria on carbon dioxide reductions, sequestration or energy efficiency. Projects where climate adaptation accounts for at least 50% of the total cost can also qualify.
In total, the bank lent €72 billion in 2010 to 460 projects, of which €9 billion was spent outside the EU. The EIB also published a detailed breakdown of the projects it financed during the year. It made a net profit of €2.1 billion.
Jess McCabe
