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Major European banks launch energy efficiency mortgage scheme

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Major European banks launch energy efficiency mortgage scheme

A group of 37 European banks, including Groupe BPCE, ABN AMRO Group NV and Société Générale SA, are launching a pilot scheme to look at ways of making mortgages more energy-efficient.

Under the scheme, the banks will develop over the next two years mortgages at lower interest rates for buyers who invest in energy-efficient homes. The mortgages will be based on criteria set by the World Green Building Council, which promotes the development of environmentally friendly buildings, and are part of the EU-funded Energy Efficient Mortgages Initiative, which is aiming to create a standard energy efficient mortgage.

In a statement, the World Green Building Council said green mortgages created greater long-term value for houses and contributed to lower energy costs, thus making them less risky investments for both borrowers and lenders.

Luca Bertalot, Energy Efficient Mortgages Initiative Coordinator, said the lenders involved in the project accounted for 45% of outstanding European mortgages.

He also said it demonstrated the willingness of the financial sector to participate in the EU's sustainable finance action plan announced in March.