The European Investment Bank boosts clean energy financing in support of REPowerEU Plan
The European Investment Bank Group (EIB Group) will support the REPowerEU Plan with an additional €30 billion in loans and equity financing over the next five years, according to the company's release. The additional funds from the EIB Group (European Investment Bank, European Investment Fund) will be directed to renewables, energy efficiency, grids and storage, electric-vehicle charging infrastructure, and breakthrough technologies, such as low-carbon hydrogen.
The package of new, targeted financing approved by the EIB’s Board of Directors is expected to mobilise up to €115 billion of new investment by 2027, thus making a substantial contribution to the REPowerEU objective of ending dependency on Russian fossil fuels. It is a supplementary envelope, on top of the EIB Group’s already robust support for the energy sector in the European Union, averaging around €10 billion of financing per year over the past decade.
While the additional EIB Group financing will focus on improving Europe’s energy security over the medium term and avert future supply shocks, EIB support for some efficiency projects could result in lower demand for gas already in 2023. The package follows a Board decision to approve €5.5 billion in financing for projects in clean energy, energy efficiency and climate action, including new wind power in the Baltics, and upgrading transmission networks in Poland and Spain.
In addition to raising expected energy-lending volumes for the next five years to unprecedented levels, the EIB’s Board of Directors also adopted a series of technical and policy measures aimed at accelerating the pace and maximizing the impact of the new investment. Key elements include higher upfront disbursements, longer tenors that will make EIB loans to the energy sector more attractive, and a co-financing ceiling of up to 75% for projects contributing to the REPowerEU objectives, up from the typical 50% EIB limit per project.
The EIB Group has adopted a Climate Bank Roadmap to deliver on its ambitious agenda to support €1 trillion of climate action and environmental sustainability investments in the decade to 2030 and to deliver more than 50% of EIB finance for climate action and environmental sustainability by 2025. As part of the roadmap, all new EIB Group operations have been aligned with the goals and principles of the Paris Agreement since the start of 2021.
