Brussels, 31/10/2006 (Agence Europe) - The European Investment Bank (EIB) last week reviewed its financing targets for energy projects that help to implement the relevant EU policies. The Bank will concentrate on five target areas: large projects, energy efficiency, renewable energy, R&D for energy, and cooperation on energy outside the EU.
EIB energy lending as a percentage of its total lending in the EU has declined from 23% in the 1980s to 9% for the period 2000-2005. These figures reflect the general trend in energy investment within the EU. The EIB financed about 5% of the investments by the energy sector, at an annual average of some €3.3 billion in the last five years. In countries outside the EU, financing of energy projects represents a larger part of EIB financing.
In a press release published on 26 October, the EIB says, “The reprioritisation of energy in the Bank's activities reflects EU policy on climate change and the renewed tensions in the oil market”. According to the new strategy which has been adopted, the bank's role in the EU should evolve from a universal provider of funds to become a flexible partner acting with more tailor-made products adapted to local market circumstances and to the needs of the interested parties. In partner countries outside the EU, the objective is to better serve the development objectives by placing greater emphasis on country and other sector intervention strategies that may involve more risk-taking, coupled with greater availability of subsidies and closer cooperation with all stakeholders.
Financing of large energy projects will focus on those with the highest EU priority. The EIB will support, in particular, projects which enhance the security of energy supply and the internal market, including notably priority Trans-European Energy Networks (TENs).
The EIB's energy efficiency target areas include financing energy efficiency investment programmes, combined heat and power as well as district heating. In addition, the Bank will explore, with promoters, possibilities for developing the energy efficiency potential of their projects financed by the Bank. In renewable energy, the EIB has retained the existing financing targets (average annual financing is over €500 million).
Additionally, emphasis will be put on developing the less mature renewable markets, both inside and outside the EU, on under-developed renewables (particularly the biomass) and on new technologies. R&D for energy will increase under the existing “i2i” policy for a knowledge-based economy. New risk-sharing financial instruments will be developed for this type of project. The EIB Group will seek complimentarity between the EU's 7th Framework Programme for Research and its i2i initiative, and it will support the European Technology Platforms and the research infrastructure for energy. Finally, in partner and neighbouring countries, efforts will go towards a pan-European Energy Community with Neighbouring Countries to better integrate energy markets. The EIB will also support new energy import routes and projects enhancing energy supply.
I developing countries, the EIB will seek to increase access to modern sources of energy and to further sustainable energy solutions, favouring particularly the emergence of low-carbon economies.
For the complete text of the “EIB Energy Review”, go to http: //http://www.eib.org/Attachements/thematic/energy_review_2006_en.pdf (ol)