These days, more and more banks in Europe and the world change their strategy of investing in energy projects. Due to the high level of hydrocarbon emissions into the atmosphere, the financial institutions devote fewer resources for lending to industrial enterprises which use oil and coal when generating power. The new strategy of bank investment is in fact the reflection of EU policy in the field of environment and climate. The strategy was recently adopted by the European Investment Bank (EIB), which published new criteria for lending to energy projects.
Currently, the majority of energy projects based on the use of coal and oil, has no chance to get funding from the EIB as they don’t meet the new environmental standards. One of the main criterion sets the maximum level of carbon dioxide in the production of energy, the level should not exceed 550 grams of CO2 per kW/h. Such requirements can be met by only those plants which besides coal use significant amounts of biomass (over 25%). According to the opinion of the leading specialist of Ukrainian Biofuel Portal Sergei Kozlov, such changes in the EU is a good prospect for Ukraine to increase the export volumes of solid biofuels.
Today the issues of global warming and the human impact on climate change are very serious for Western countries. Therefore, as explained by the experts, the financial institutions such as the European Investment Bank and the World Bank try to prove that there exist the ways of development when it is possible to meet human needs (use electricity and heating) without using coal.
The World Bank also formulated the new rules for granting loans to energy projects. In addition, the projects with the use of coal will not be financed by such banks as HSBC, the Nordic Investment Bank, Storebrand and Portigon.
The experts explain that the EIB decided to use in its policy so-called "win-win" directions of development which will provide both energy security and the competitiveness of European economy. This means that from now on the projects financed by the EIB will have to meet international standards in terms of greenhouse gas emissions.
The European Investment Bank came up with a somewhat innovative solution by adopting a so-called Standard of emissions. Simply put, this is the maximum amount of emissions that the bank is ready to admit when investing in the launch of new power, electrical or thermal station.
The restrictions for the projects with the high level of CO2 emissions result from the European law in the field of energy, including so-called "Paths of carbon dioxide emissions in the EU". Currently the government is discussing the targets for the reduction of emissions by 2030. In this regard, the new formulated obligations will influence the credit policy of banks in the world.
Another criterion of the EIB, which will be reflected in energy projects, is forming the new price of CO2. This means that during the analysis of the project's profitability the bank will deduct 28 euro for each ton of carbon. Last year the market price of CO2 ranged from 3.75 to 6 euro. The rate of CO2 levied by the EIB will gradually grow and by 2030 it is supposed to reach 45 euro.
Currently the energy projects that compete for bank financing must comply with EU legislation, including Directive on industrial emissions. In addition, within the framework of the project all technologies should be modern and harmless for the environment.
