Tuesday, February 17, 2015

EU Launches Pilot Projects to Leverage Green Energy Spending

Solar panels (Credit: © photochecker/istockphoto.com) Click to Enlarge.
European Union climate and energy bosses launched two projects on Monday designed to unleash more than a billion euros ($1.1 billion) of spending on measures to save energy and adapt to climate change.

The pilot projects will help to prove that a much bigger Commission scheme to turn 21 billion euros of EU and European Investment Bank funds (EIB) into at least 315 billion euros of public and private sector investment can work, the Commission says.
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First presented in November by Commission President Jean-Claude Juncker, the European Fund for Strategic Investment is meant to act as a "risk buffer", soaking up losses on projects before other creditors and breaking down a reluctance to invest.

Nearly a third of the overall spending under the Juncker plan is meant to be related to energy.

One of the pilot projects presented on Monday that will run until 2017 is the Private Finance for Energy Efficiency scheme.

It will take 80 million euros of Commission money to try and elicit more than 550 million euros in spending on ways to save energy, such as better insulated buildings.

While EU officials declined to go into details, they said the 80 million would be used to protect against credit risk on energy efficiency loan portfolios and said the Commission would also provide technical expertise.

The other project is the Natural Capital Financing Facility.  It will draw on up to 125 million euros of EIB funds to attract investment in projects such as forestry management.

"The EIB expects more than 1 billion euros of investment in energy efficiency and sustainability schemes to be unlocked through the two new initiatives," EIB spokesman Richard Willis said.

The Institutional Investors Group on Climate Change, which represents investors responsible for nearly 9 trillion euros in assets, says EU financing instruments can attract private capital if there are strong policies to support them.
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The Commission will deliver some policy direction next week, when it publishes a strategy for a stronger energy union with better grid connections, improved security of fuel supply and greater efficiency.

Read more at EU Launches Pilot Projects to Leverage Green Energy Spending

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