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EIB to discuss end to fossil fuel lending at Oct 15 meeting
The EIB will discuss its energy sector lending policy at an board meeting on Oct. 15, the bank said in an agenda on its website, possibly deciding to reduce its emission standards and bar fossil fuel projects from receiving EIB funds.
If the EIB’s board, made up mostly of European Union finance ministers, decides to lower emissions standards, it could mean even the most efficient new natural gas projects would be barred from EIB funding by the end of 2020.
Green EU lawmakers have been strong opponents of allowing the EIB to continue funding fossil fuel projects. Green EU lawmaker Bas Eckhout told Reuters on Thursday the EIB should stop all financing for any such projects.
“For a climate neutral economy by 2050 you need to make sure your energy infrastructure is zero-carbon,” Eckhout said.
An end to EIB gas funding would be opposed by Germany as it aims to use more gas as a transition fuel in its shift towards a low carbon economy. Berlin wants to use gas to help replace coal and nuclear, not just in electricity production but also in local heating.
A government-appointed coal exit commission in January explicitly said in its recommendations that gas-to-power generation plants, offering half the CO2 emissions of those from coal-burning power stations, should be given incentives.
Power from gas plants can be quickly increased, ideally complementing weather-driven changes in renewable output.
“Investments in highly efficient gas plants are investments in success of the energy transition,” said Stefan Kapferer, managing director of Berlin-based utility industry association, BDEW, in reply to an enquiry.
He cited the flexibility of gas plant operations. “This makes it all the less understandable that the EIB’s new lending guidelines should no longer allow even highly efficient gas plants to qualify for financing,” he added. “The EIB should think twice about its decisions.”
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