The European Investment Bank (EIB) has proposed to end the financing facility for fossil fuel-reliant energy projects by the end of 2020. The bank categorically said that financial support would no more be available to projects that were reliant on fossil fuels: oil and gas production, infrastructure primarily dedicated to natural gas, power generation or heat-based on fossil fuels.
The proposal would be presented to the Board of Directors of the EIB for discussion in September, however, the final decision might take much longer. According to the bank, it must align with the Paris Agreement which aims to halt global heating at 1.5C above 1990 levels by cutting greenhouse gas emissions. Environmentalists are pressuring financial institutions to withdraw their support for high-carbon projects. An open letter to EIB was also published by multiple civil society organizations to end the financing of the subject matter. Earlier, EIB has funded fossil fuel projects including the Trans Adriatic gas pipeline and oil storage facilities in Cyprus.
The bank further stated to establish a support fund for projects which will help EU member states’ transition to a cleaner economy.
The proposal was much appreciated by the critics as Alex Doukas, from environmental campaigner Oil Change International commented in a statement that, “The EIB’s proposal to end financing for fossil fuels by 2020 is a massive step forward in climate leadership. With this move, the world’s largest multilateral lender is now poised to leave oil, gas, and coal in the past. The EU member states who control the bank must now stand behind the EIB’s ambitious climate vision, and other financial institutions should quickly follow suit to stop funding fossils,”. The move was also regarded as a crack of light in the darkness.
EIB has also been advised to spend half of its yearly estimated investments (70 – 80 billion euros) on green projects, by the incoming President of the European Commission Ursula Gertrud von der Leyen.
