Recommendations to the European Investment Bank on its energy lending

The EIB is the European Union’s house bank, committed to furthering the EU’s goals, including reducing greenhouse gas emissions by 20 percent by 2020 and by 80-95 percent by 2050 compared to 1990 levels. Energy represents the second largest lending category in the bank’s overall portfolio which has reached 60 billion Euros in 2011. However CEE Bankwatch Network study[1] showed that the financial arm of the union is putting each year more and more billions of euros of public money into energy infrastructure that will lock in countries into a fossil-fuel dependent path for four-five decades.

This clearly shows that the European Investment Bank's (EIB) energy policy drafted in July 2007 is not yet in line with more recent EU’s long-term goals related to climate protection , which implies an almost total decarbonisation of the energy sector by 2050.[2] Thus on the occasion on 54^th EIB Annual General Meeting we call on the Governors of the Bank to address this namely by adjusting the direction for the bank to follow in the year to come and the in the bank's energy policy planned to be revised this year.

Bearing in mind that energy infrastructure constructed today will often be in use even beyond 2050, CEE Bankwatch Network recommends that the EIB makes forward-looking decisions now and revises its energy policy in line with climate science.

In order to make a clear commitment and mobilise its resources to support low carbon development in Europe and outside, Counter Balance recommends that:

1. The EIB immediately ceases support for the most carbon intensive types of electricity and heat generation, starting from coal;
2. The EIB limits its lending to energy projects which are strongly justified in the EU energy policies and stops support for investments, which are driven by national or regional interests only;
3. If the EIB continues support for fossil fuel projects each of them should undergo a transparent process of screening against compliance with the EU climate goals.
4. The EIB introduces an annual regressive cap on the EIB lending to fossil fuels based projects (new power plants, pipelines, storage facilities, extraction) which would reduce the EIB’s lending to greenfield fossil fuels to zero starting from 2016;
5. The EIB prioritises energy efficiency as the most important area of intervention and it must continue increasing its support for renewables, especially decentralized small-scale ones;
6. The EIB mainstreams climate change considerations into its lending policies through establishing a more ambitious target for its Climate Action to reach in 2015 at least 50% of its lending[3];
7. The EIB develops solutions in its policy, in order to overcome the current situation where the share of clean energy lending in less developed EU countries is substantially lower than in the EU old member states.
8. The EIB stops financing large dams until it fully transposes the recommendations of the World Commission on Dams into its energy and environmental policies (as binding provisions) as well as into the projects implementation.

The EIB starts a multiparty evaluation of its loan policies for energy to determine how EIBloans can ensure the development of environmentally sustainable renewable energy that benefits the poorest parts of the population, whilst fulfilling the European Union’s development objectives. On this basis, the EIB must implement a coherent policy on the matter.

[1] Carbon Rising; http://bankwatch.org/publicati...
[2] European Council conclusions, October 2009 and February 2011; EC communication: “A Roadmap for moving to a competitive low carbon economy in 2050, March 2011, COM(2011) 112 final; European Commission communication Energy Roadmap 2050, 15th December 2011 COM(2011) 885/2
[3] Currently the target established in the EIB’s Corporate Operational Plan is set at the level of 25%