BAKU, Azerbaijan, Jan.28
By Leman Zeynalova - Trend:
The European Investment Bank (EIB) cooperation with Azerbaijan in energy sphere will be influenced by recently adopted EIB Energy Lending Policy and Climate Bank Road (CBR) map, EIB told Trend.
“From 2021, the EIB Group will only support operations that are aligned to the goals of the Paris Agreement - i.e. a pathway towards low carbon and climate resilient development. In 2019, the EIB announced the phasing out of support to all energy projects reliant on unabated fossil fuels. The CBR extends this framework to account for all high emitting sectors: transport, industry, buildings, agriculture; as well as developing an approach to ensure EIB projects are routinely assessed for future climate risks.
The new energy lending policy details five principles that will govern future EIB engagement in the energy sector:
· prioritising energy efficiency with a view to supporting the new EU target under the EU Energy Efficiency Directive
· enabling energy decarbonisation through increased support for low or zero carbon technology, aiming to meet a 32% renewable energy share throughout the EU by 2030
· increasing financing for decentralised energy production, innovative energy storage and e-mobility
· ensuring grid investment essential for new, intermittent energy sources like wind and solar as well as strengthening cross-border interconnections
· increasing the impact of investment to support energy transformation outside the EU,” said the Bank.
EIB noted that an important element of the alignment framework is driven by the shadow cost of carbon – i.e. the cost to society associated from an emission of GHG from a project.
“The CBR increases the value of the Bank’s shadow cost parameter in line with the latest evidence. The shadow cost of carbon rises from €80/tCO2 today to €800/tCO2 by 2050.
The EIB Climate Bank roadmap explains how we will meet these new commitments. Here are some of its most important elements:
· Increase EIB finance for climate action and environmental sustainability from about 30% today to at least 50% by 2025
· Align all new finance with the principles and goals of the Paris Agreement
· Support €1 trillion of investment in climate action and environmental sustainability from 2021 to 2030
· Build upon the commitment to stop supporting traditional fossil fuel energy projects
· Maintain leadership in the capital markets, where the EIB was the first institution to issue a green bond and is still the largest supranational green bond issuer
· Focus on clean energy, innovative technologies and digitalisation, which will play a major part in modernising and decarbonising industries
· Introduce new tools that draw on robust climate data to better understand climate risks
· Increase finance that helps societies adapt to climate change happening right now and makes economies more resilient to future problems,” said the Bank.
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