EIB moves funding from fossil fuels to renewables

EUROPE: The European Investment Bank (EIB) will no longer invest in certain fossil fuel plants as it shifts its funding towards renewable energy.

The EIB building in Luxembourg
The EIB building in Luxembourg

Plants that use coal, oil or lignite will no longer receive funding due to the levels of greenhouse gases emitted per kWh of energy produced.

The bank is the world's largest lender for renewable projects and already has a commitment to spend 25% of its cash on projects that support climate action.

There was no indication of the level to which wind projects will benefit from the shift, but the bank made in clear that it would increase its investment in the industry.

"Adoption of the new lending criteria represents an important step forward in the EIB's commitment to energy investment that supports EU policy and reflects the urgent investment challenges currently facing the energy sector," said Mihai Tanasescu, vice president for energy.

"Prioritising lending to energy efficiency, renewable energy and energy networks will help the EU to meet its energy and climate objectives."

As well as funding wind and solar projects, it has pumped money into grid infrastructure projects that enable further renewable development, such as the transmission link to the UK's Walney 2 offshore wind farm.

Over the last five years EIB lending to power generation projects using fossil fuels declined significantly, with lending to coal and lignite power stations representing around 1.5% of overall lending.

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