EIB accused of smoke and mirrors over new climate lending plan
9 October 2015, BusinessGreen
European Investment Bank ditched reference to 2050 decarbonisation target, says NGO
The European Investment Bank (EIB) has been accused of exaggerating its stepped up commitment to tackling climate change this week, with campaigners accusing it of failing to deliver any real advance on its previous lending strategy.
The NGO CEE Bankwatch Network accused the EIB of scrapping a reference to the EU’s 2050 decarbonisation pathway in the new strategy and carrying out a “masterpiece of PR” by making vague new commitments without specific targets.
The EIB this week unveiled its new climate lending strategy, pledging to ringfence “at least 25 per cent” of its investments for climate-related projects between 2015 and 2017, and promising to boost lending to energy efficiency and climate adaptation projects.
The EIB is already the world’s largest source of climate-related investment and says the new strategy will further strengthen its commitment.
But Anna Roggebuck, policy officer for CEE Bankwatch Network, told BusinessGreen that the new strategy would deliver barely any improvement on the previous plan, arguing that the 25 per cent target was virtually the same as before.
“EIB 25 per cent commitment to climate action is nothing new at all and is not that significant for the EU financial arm,” she told BusinessGreen in an emailed statement, noting that the bank had already achieved 30 per cent share of climate-related lending in 2010. “This target has already been established in 2010 on this level and since then it has not been increased.”
She argued that despite pledging to boost lending to energy efficiency projects, the bank has delivered no new mechanisms for doing so and she said the previous 2010 strategy also included a pledge to step up its lending to adaptation.
“[The] climate strategy is limited to the description of the existing bank’s climate commitments and brings nothing new neither to EU internal efforts nor to international COP discussions,” she added.
She also accused the bank of ditching a reference in the new strategy to the EU’s 2050 decarbonisation pathway, which aims to reduce carbon emissions by 80 per cent by the middle of the century compared to 1990 levels.
She said the pathway had been referenced in the draft strategy published in August but was deleted after board approval. “Thus now we have an EU financial institution whose climate strategy does not refer to existing and binding EU long-term climate objectives,” she added.
“The new strategy is a masterpiece of PR – ‘we will do a lot but do not know yet how and when’. And the final edit done by getting rid of EU 2050 decarbonisation objectives is a real shame for this European Union,” she said.
However, Richard Willis, a spokesman for the EIB, defended the new strategy, which he argued did build on its previous commitments. Previously, the bank had targeted a 25 per cent climate lending share, but now that number was a minimum, he said.
“This is the first time we’ve had a firm commitment [to the 25 per cent share]. This is set in stone for the first time,” he told BusinessGreen.
He also argued that the bank was actively promoting its new energy efficiency products, such as PF4EE (Private Finance for Energy Efficiency), which was launched in May this year. It currently has just one signatory, but Willis said the EIB had recently been approached by a regional UK bank interested in taking part in the initiative.
He also defended the EIB’s decision to drop the reference to the EU’s 2050 decarbonisation pathway, arguing it was made by a number of member states who are shareholders of the EIB. He said the language was changed to better reflect the European Council’s conclusions in the EU 2030 Climate and Energy Framework.
As finance ministers gather in Peru this week to talk about how best to scale up climate finance, it is clear that multilateral development banks such as the EIB are coming under growing scrutiny to prove they can play a key role in tackling climate change.