We reproduce here a selection of these comments (EIB questions in italics, followed by DG Environment reactions). It is encouraging to read DG Environment’s persuasive arguments placing a strong emphasis on sustainable energy – it’s the kind of emphasis that Bankwatch would be delighted to see running through the heart of the EIB’s new energy policy.

Particularly in the current economic climate, is there a trade-off between promoting a competitive and secure energy supply and one which is environmentally sustainable? Where should the balance lie and what implications does this have for energy sector investments?

The objective of the EIB should be to avoid any trade off and to fund investments that promote at the same time sustainability, competitiveness and security of supply. This is not only rhetorical: for instance, by developing wind, solar or geothermal energy production in the EU, it not only allows European industry to develop in new sectors (and potentially gain competitiveness there), but it also ensures intra-EU and sustainable energy sources.

The development of smart grids is the big challenge in terms of energy transmission and should represent the bulk of investments in the domain. Together with energy storage, it will allow to fully incorporate renewable variable energy into the system.

The promotion of off-shore grids is of importance as it practically helps transferring the energy produced to the consumption centres, allowing for a much greater area to be utilised for the production of energy and also the development of new technologies (wave energy generation, off-shore wind turbines, etc).

Gas is an important bridging fuel source in the transition to a low carbon economy: to what extent and under what conditions should gas-fired generation be supported?

Is the traditional model for electricity transmission and distribution changing? What implications does this have for future investments in electricity networks? What is the future role of smart grids, offshore grids and energy storage solutions?

Only if alternatives (renewables) have been considered, assessed and compared, and if the overall effects (economic, social and environmental, assessed on an equal footing) are in favour of gas.

Recent studies from the IEA suggest that gas will become more competitive than coal by 2017. This provides opportunities to switch to an energy mix with more gas, however it may also increase dependency from the East for this provision or on LNG from US and other more distant countries. Furthermore it may increase the search for and exploitation of shale gas in Europe.

The Commission is currently impact assessing several options for an environment, climate and energy framework for unconventional fossil fuels and in particular shale gas development in the EU. The policy of the EIB should follow the lines to be presented by the Commission next year. This would contribute to a better avoidance of stranded assets.

What role will coal and lignite fired generation have in the EU power system in the medium term, with or without CCS, and how is this consistent with the EU’s Climate Action goals and its security of supply objectives?

This is very inconsistent with the Climate policy and should be funded only if CCS is actually in the project (and not “CCS ready”). Security of supply can be ensured through many other sources, including renewable sources, which are most of the time domestic.

As nuclear power stations are ageing, should their life be extended (where possible) or should they be replaced with other generation sources?

Extending the life of nuclear plants is not a sustainable option: it increases the risk of accident, and continues increasing the nuclear waste management problem. Ageing nuclear plants should be replaced by renewable energy sources that create the least negative impacts (eg, wind, solar).

In a developing market context, where should the balance lie between meeting local energy needs at least cost and reducing global greenhouse gas emissions – the trade-off between affordable energy for all and sustainable energy for all?

There is not necessarily a trade-off if actions towards energy efficiency and local renewables sources are promoted.