Brussels — The European Investment Bank is reviewing its lending criteria for energy projects, including a 550g CO2/kWh emissions performance standard for power plants adopted in 2013, EIB spokesman Richard Willis said Friday.
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The review comes just weeks after EU negotiators agreed to use this 550g CO2/kWh limit for a phased-in ban on capacity payments to power plants exceeding it.
This is part of draft EU power market design rules intended to help the system integrate expected growing shares of renewables more effectively.
The EIB, which is funded by EU national governments, will be looking for guidance from the market to see if the emissions performance standard should be lowered, Willis said.
"We're looking to see what has changed in the last five years, in technology for example, and where the investment gaps are," he said.
The EIB invested Eur40.7 billion ($47 billion) in pure energy projects from 2014 to 2018 in the EU alone, and Eur49 billion in total.
This included financing for 30 European projects of common interest, the EU's system for identifying and helping strategic infrastructure that supports its wider climate and energy policy goals.
These goals include the EU's new 2030 targets, in force since late December, to source 32% of EU energy demand from renewables and improve EU energy efficiency by 32.5%.
The EU also has a 2030 target to cut its greenhouse gas emissions by at least 40% on 1990 levels.
"We would expect future lending to support the EU's efforts to decarbonize, use more renewables and become more energy efficient," Willis said.
The EIB has traditionally also supported EU energy security projects, including new pipelines to diversify gas supplies.
For example, it confirmed on Friday financing for the TAP gas pipeline project that will link Italy and Greece to gas from the Caspian region for the first time.
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But the EIB is under pressure from environmental groups such as Bankwatch, which monitors public finance institutions, to justify its lending to fossil fuels, including natural gas.
"We're aware of the concerns, and it's a complex debate. The role of gas as a transitional fuel [as the EU decarbonizes] is accepted by many," Willis said. "There's also the issue of stranded assets."
The EIB will be looking at what and how much investment in energy supply security is needed as part of the review.
EU energy regulatory bodies ACER and CEER said in a report last year that the EU's gas market was generally secure overall, with some bottlenecks still in south-southeastern Europe.
They recommended that the EU focus more on supporting strategic projects that bringing environmental benefits, including renewable gases, for example.
The EIB has published a consultation document at http://www.eib.org, and plans a stakeholder meeting to discuss this in Brussels February 25.
The goal is for the EIB's board of directors to adopt a new energy lending criteria policy in the third quarter of this year.
--Siobhan Hall, firstname.lastname@example.org
--Edited by Jonathan Loades-Carter, email@example.com