EIB: Overview

Founded:
1958
Mission:
"To support projects that make a significant contribution to growth, employment, regional cohesion, and, environmental sustainability in Europe and beyond."
Total assets:
$553 billion
Headquarters:
Luxembourg
Top five shareholders:
Germany, France, Italy, Spain, Belgium and the Netherlands.
Summary of Paris alignment assessment:
The European Investment Bank is not yet 100% Paris aligned, but it has made significant progress and is a leader institution in many areas. The EIB has committed to full Paris alignment by end of 2020 and will successively adjust all lending operations in accordance with that goal. Its Energy Lending Policy is a best practice amongst the MDBs. The Bank could improve its transparency practices by reporting in more detail on its own progress in this area, as well as its intermediary lending.

This page is part of the E3G Public Bank Climate Tracker Matrix, our tool to help you assess the Paris alignment of public banks, MDBs and DFIs.

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MetricSummary
Promotion of green financeParis Aligned – The Bank is active in the realm of green bonds and has provided some information on other areas of green finance promotion. However, the actual impact is not yet visible.
Fossil to non-fossil energy finance ratio and scaling up climate financeSome progress – In 2016-18, for every $1 the EIB provided to fossil fuels, $2.7 went to renewables and $1.2 went to energy networks (transmission and distribution). This is expected to change over the next few years due to the EIB’s new Energy Lending Policy.
Nature based solutionsSome Progress – Some progress around ecosystem services within climate strategy. The Climate Bank Roadmap strengthens EIB’s lending in biodiversity and nature based solutions; commitments around agriculture, but details are lacking; EIB has some committments to net-zero deforestation.
Climate risk, resilience, and adaptationSome progress – EIB screens systematically projects under the Climate Risk Assessment (CRA) system since 2019. The Climate Bank Roadmap has ambitious targets for risk assessment to be applied across the institution, but the implementaiton and adherence to those plans remains to be seen. EIB has one of lowest share of adaptation finance across MDBs.
Overarching climate strategyParis aligned – The EIB Climate Bank Roadmap as a whole is a significant step toward a Paris aligned Climate Bank. The Roadmap is based on a 1.5 degree scenario and has inferred concrete actions from that, most notably a shadow carbon price of 250€ per ton by 2030 and 80€ by 2050. However, to be transformational, the implementation of the roadmap will be key and we will closely monitor the process, keeping to adjust the assessment in the future.
Integration of climate mitigation and resilience in key sectoral strategiesSome progress – Climate resilience well integrated in water and cities sectors, but progress needed in energy and transport. Mitigation well reflected in energy and cities, but progress needed to integrate mitigation into transport and water. The EIB Climate Bank Roadmap has set a good precedent which now has to be translated into sectoral strategies accordingly.
Institutional leadershipTransformational – Leadership in energy transition, green bonds, joint MDB standards, the EU Sustainability Taxonomy and Paris alignment. The Climate Bank Roadmap, if implemented as proposed, will consitute a transformational precedent for other PDBs to consider.
Energy access and fuel povertySome progress –  Unclear whether or not the Bank supports the Access to All priority, progress monitoring and disclosure is not evident.
Energy efficiency strategy, standards and investmentParis aligned – Robust energy efficiency standards are in place; energy efficiency first principle needs operationalizing across sectors.  
Fossil fuel exclusion policiesParis aligned – All fossil fuel investments excluded, exclusions on coal and upstream oil and gas already implemented. 
Greenhouse gas accounting and reductionSome progress – EIB does not have a target to peak and reduce portfolio emissions.
Shadow carbon pricingTransformational – Prices align and go signifcicantly above the High-Level Commission on Carbon Prices recommendation and are applied to all projects above the emission threshold. The shadow carbon price is based on a 1.5 degree IPCC scenario.
Country level workNot available – The EIB does not have specific strategies to guide its country-level work. 
Technical assistance for implementing Paris goalsSome progress – EIB has niche advisory platforms but does not provide overall technical assistance or NDC support, despite recognising its importance. In general EIB provides little technical assistance compared to other MDBs. 
Transparency of climate finance dataSome progress – Transparency of financial intermediary lending needs improving. 

Recommendations

  • The EIB should update all its sectoral frameworks to reflect its ambitions. The Energy Lending Policy sets a good precedent here, that should be mirrored in all sector policies of the EIB. This is especially relevant for the transport sector. Climate resilience should be further integrated across all sectors.  
  • The EIB could improve its lending strategy in nature-based solutions. This should include a full commitment to net-zero deforestation. 
  • Improve transparency and reporting. The EIB should expand its strategic framework to all intermediary lenders and be transparent on their performance.  
  • The EIB needs to enhance its adaptation finance and climate risk assessments. The Bank should go beyond project-by-project assessments and mainstream adaptation practices across its lending operations.  
  • The EIB could enhance its energy access framework. This should include a clear commitment to the ‘access for all’ priority and respective monitoring and reporting on the progress.

 

Leadership area

EIB is a leader in its energy lending policy, where it has decided to phase out support for almost all unabated fossil fuel projects.

The EIB has introduced the most ambitious shadown carbon price of all MDBs, but the full transformational potential will depend on its application across lending operations.

Last updated: November 2020.

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