The European Bank for Reconstruction and Development (EBRD) is scaling up its contribution to the global fight against climate change with a sharp increase in green financing over the next five years.
The announcement comes just two months before a conference in Paris (COP21) which is set to seal an international climate agreement and define an agenda of specific actions to combat climate change.
The EBRD has had a strong environmental mandate from its foundation. Since the launch of its Sustainable Energy Initiative in 2006 it has invested over €18 billion in over 1,000 sustainable energy and resource projects with a total value of €97 billion.
Announcing the further rise in green finance, EBRD President Sir Suma Chakrabarti said: “The international community has a unique chance this year to deliver a decisive set of measures to combat climate change. With its long experience as a leader in climate finance, the EBRD is making an important contribution to this collective stand through its Green Economy Transition approach.”
With this new approach, which was endorsed by the EBRD’s Board of Directors today, the Bank is aiming for green financing to total some €18 billion over the next five years. In other words, the EBRD would deliver as much green financing in the next five years as it has in the last ten.
The EBRD is aiming to increase the Bank’s green financing to around 40 per cent of total annual investments by 2020 compared with a target share of 25 per cent over the previous five years. In 2014, the EBRD in fact dedicated 34 per cent of its total €8.9 billion in investments to sustainable energy and resource finance.
Through investing in a wide variety of projects ranging from solar plants in Jordan and Kazakhstan and wind farms in Turkey and Mongolia to energy efficiency projects in factories and commercial and residential buildings, EBRD finance for sustainable resource use has led to a reduction of carbon emissions of over 72 million tonnes a year.
The investments have generated almost 60 million MWh a year in renewable energy, equivalent to the electricity production in Romania in 2013, and led to annual energy savings of over 26.3 million tonnes of oil equivalent, exceeding the total energy demand in Greece in 2013.
The increase in green financing agreed by the EBRD’s shareholders today will be achieved by scaling up further these existing activities in areas like renewable energy project finance, district heating rehabilitation and the EBRD’s successful Sustainable Energy Finance Facilities.
The Bank will also step up its work to transfer the most advanced climate technology into the countries where it invests and develop new approaches for increased energy efficiency in various industries, such as in financing building rehabilitation.
Policy reform activities will play an increasingly important role in supporting countries as they step up climate finance. The EBRD will intensify its efforts to work with authorities at all levels to support the introduction of regulation and legislation, as well as investment planning, which actively promote investment in energy efficiency and renewable energy projects.