EBRD green finance in 2021 hits record 51 per cent of €10.4 billion total

By Vanora Bennett

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  • Total Annual Bank Investment (ABI) reaches €10.4 billion, its second highest figure ever
  • Green economy investments of €5.4 billion account for record 51 per cent of total financing
  • Private sector share of annual investment rises to 76 per cent

The EBRD’s green financing hit a record €5.4 billion, or 51 per cent, of total business volume of €10.4 billion in 2021.

“These excellent results underscore the Bank’s strong dedication to continuing to support its clients in the wake of the pandemic as well as its commitment to decarbonise economies and enable the transition to a more sustainable future, with a focus on involving the private sector and supporting reforms to tackle climate change,” said EBRD President Odile Renaud-Basso.

The 2021 green results, a significant increase on the 29 per cent share of total financing in 2020, fall under the EBRD’s Green Economy Transition (GET) approach.

They follow the Bank’s recent twin commitments to align all its investments with the goals of the Paris Agreement on limiting climate change by the end of this year, a decision taken by its Board of Governors at last July’s Annual Meeting, and to make a majority of its investments green by 2025.

At the November 2021 COP26 climate summit in Glasgow, the EBRD also set out how it plans to support the transition to a low-carbon economy in its regions by doubling the mobilisation of private-sector climate financing by 2025.

The EBRD, a leading climate finance investor, works in some of the world’s most fossil-fuel dependent countries and aims to support them in planning and executing their transition to a low-carbon economy.

Among its many successes is EBRD Green Cities, a €5 billion urban environmental programme, which has grown to include 53 cities in its five years of existence and helps them identify, prioritise and connect their environmental challenges with sustainable infrastructure investments and policy measures.

The EBRD announced in November that the programme was doubling in size, allocating a further €2 billion to invest in green urban infrastructure over the next two years.

The 2021 green finance record was a key element in the EBRD’s second highest overall annual business volume ever. The record of €11 billion was set in 2020 when its investments were buoyed by emergency lending at the start of the Covid-19 pandemic.

The total number of its projects in 2021 was 413, compared to 411 in 2020. The share of private sector investment rose four percentage points to 76 per cent.

Annual Mobilised Investment - the amount made available to clients from entities other than the EBRD due to the Bank’s direct involvement – climbed sharply to €1.8 billion from €1.2 billion in 2020. Disbursements totalled €7.3 billion for the year.

The EBRD raised approximately €1.2 billion in donor funds to support its operations in 2021 and is an important partner for the European Union, the Bank's largest multilateral donor.

Under its EU budget and NextGenerationEU funding programmes, the EU provided €291 million in 2021 and through the EU's pandemic-related Recovery Resilience Facility €500 million in concessional finance were provided by Greece

Bilateral donors contributed some €123 million to the High-Impact Partnership on Climate Action (HIPCA), the EBRD's first green-focused multi-donor facility, launched at COP26. 

Inclusion and digital, the EBRD’s two strategic priorities other than green, also made a major contribution to the Bank’s success in 2021.

Projects with a strong gender component accounted for 35 per cent of projects signed during the year, nearly double a target floor of 18 per cent.

With two new interlinked EBRD strategies for the promotion of gender equality and equality of opportunity released in November, the Bank now aims to integrate gender equality components into at least 40 per cent of its operations by the end of 2025, and a quarter of EBRD annual investments will fund inclusion projects.

The Bank published its first Digital Approach, also in November, addressing the urgent need for economies to embrace rapid technological change to overcome the challenges exposed by the Covid-19 pandemic through investment, policy engagement and advisory services.

The 2021 ABI results showed the quality of the EBRD’s investments and impacts rose, as measured by the Bank’s performance indicators.

The EBRD’s impressive operational performance in 2021 was matched by strong profitability. More details on the latter will be announced in the weeks ahead.

Annual Bank Investment – Regional

Green Economy Transition Investment – Regional

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