the EU bank

The European Union has made climate change mitigation and adaptation a top policy priority. As the long-term lending body of the EU, the fight against climate change has thus also become a priority for the European Investment Bank (EIB).

Climate change considerations are mainstreamed in all EIB sectoral policies and integrated into all operational activities furthering the Bank’s corporate objectives and policies, and EIB project appraisals in particular in the energy, transport, urban services and infrastructure sectors.

The Bank seeks to promote actions in five broad areas: mitigation; adaptation; research, development and innovation (RDI); technology transfer and cooperation and support for the carbon markets. With regard to mitigation, the Bank aims to promote alternative and renewable energy sources and increase energy efficiency in all its projects. In addition, all projects submitted for financing are screened to assess their capacity to generate carbon credits. As regards adaptation, the Bank promotes corresponding projects per se and ensures that schemes exposed to high climate risks are climate resilient. The Bank also favours RDI investments in low-carbon technologies and processes. Support for and diffusion of technological development has grown with a number of new initiatives, including the setting up of carbon funds in cooperation with other international and national financing institutions.

Mitigation and adaptation

Financing activities related to climate change mitigation and adaptation are developed in the framework of the sectoral lending policies adopted by the EIB, covering energy, transport, water, waste, and research, development and innovation (RDI). The EIB’s operational initiatives include:

• strong support for energy efficiency and renewable energy investments;

• investments to accelerate the development and the use of cost-effective low carbon technologies and processes in all sectors (long-term R&D, early-stage commercialisation and demonstration; clean transport; carbon capture and storage);

• support for the reduction of emissions from deforestation and degradation (REDD);

• scaling up lending in sectors particularly vulnerable to climate change and to governments and local authorities that need to adapt to climate change (i.e. flood control and drought management measures in the water sector);

• providing technical assistance mechanisms.

The EIB and Carbon Finance

Carbon finance initiatives form an integral part of the European Investment Bank’s response to the challenges posed by climate change. The EIB has established market-based instruments to encourage carbon trading, in cooperation with other public and private financing institutions, at national and international level. EIB-sponsored carbon funds aim to help EU Member States and companies, as well as other institutions, to meet their carbon emission obligations at EU and international level. With tailored objectives, structures, regional focuses and participants, EIB-sponsored carbon funds have all been designed to extend market capacity and complement rather than replace private sector participants in the carbon market.

For additional information on the EIB and Carbon Finance, please visit the following websites:

The Multilateral Carbon Credit Fund (MCCF)

The Carbon Fund for Europe (CFE)

The EIB/Kreditanstalt für Wiederaufbau (KfW) Carbon Programme