Crisis & Climate Action at the EIB Christopher Knowles

1. Crisis & Climate Action at the EIB Christopher Knowles Head of Climate Change & Environment Division EIB Brussels, 15th March 2011

2. The European Investment Bank (EIB)European priority objectives Within the Union: • Cohesion and convergence • Small and medium-sized enterprises (SMEs) • Environmental sustainability • Knowledge Economy • Trans-European Networks (TENs) • Sustainable, competitive and secure energy

3. The European Investment Bank (EIB)European priority objectives Outside the Union: • Private sector development • Infrastructure development • Security of energy supply • Environmental sustainability • Support for EU presence in Asia and Latin America via Foreign Direct Investment (FDI)

4. Large Volumes of Issuance Volume of issuance compares with that of certain EU Governments … EUR bn *Gross financing requirement for FY2010-11 … and is larger thanthat of other supranationals EUR bn ** Fiscal years from July to June Source: Barclays Capital research as of 26 January 2011Data collated from a mixture of official reports and bond market analysis systems such as Dealogic

5. EIB Signatures 1958-2010

6. Signatures and Disbursements from 2006 to 2010 Signatures Disbursements EUR bn

7. EIB Signatures 2010 (in EUR)

8. Current EIB Framework for Climate Action EIB’s corporate objectives, targets, principles and standards : Aligned with the EU and international evolving climate policy Mainstream climate change considerations across Bank operations - building up staff awareness, capacity, and expertise. Ensure that sector lending policies emphasise reduced GHG emissions Mobilise & leverage private investment for developing LICs and MICs - incl. reinforcing the carbon markets and related mechanisms beyond 2012. Accelerate development & diffusion of low-carbon technologies, including those mitigating emissions from fossil fuel technologies e.g. CCS, engines Scale up financing and TA for urgent adaptation e.g. water; EIB COP KPI Climate Change > 25% of overall lending by 2012; RE > 20% of total energy

9. Climate Change Action The EIB’s climate action focuses on: • low-carbon investments that mitigate greenhouse gas emissions • climate-resilient projects that improve adaptation to climate change impacts. Loans of EUR 20.5bn in 2010 for: • energy • transport • water, wastewater, solid waste • forestry • research, development and innovation (RDI) Total loans of EUR 37.4bn since 2009

10. EIB Climate Change action • Renewable Energy • Energy Efficiency • Sustainable transport • RD&I Climate change is a growing course of action for EIB in four major sectors of activity:

11. EIB’s RE Lending2006-2010 – EUR 15,753m

12. Wind Energy projects accounted for 54%of EIB’s Renewable Energy Financing in 2010 EIB’S renewable energy financing in 2010

13. Global reach of EIB action in climate changeDirect investments

14. Offshore wind Belwind Project • Capacity: 165MW (55 wind turbines, 3MW/ unit) • Location: 46 km off the Belgium coast, depth 20-37 m • Sponsors: Colruyt, Econcern, Financial Investors • Total project cost: EUR 619.4 M • Construction contracts: Vestas & Van Oord • Long term O&M by Vestas

15. Sponsors: RWE Innogy, EDF Energy Nouvelles, Deme, local Belgian shareholders Total project cost: EUR 1.3bn Construction contracts: Deme & Repower Long term O&M by Repower Capacity: 295MW (48 wind turbines, 6MW / unit) Location: 35 km off the Belgium coast Offshore Wind PowerThe C-Power Project (Phase II)

16. Capacity: 53MW Location: German sector of the Baltic Sea Sponsors: EnBW Total project cost: EUR 200m Turbine Provider:Siemens O&M by Siemens Offshore Wind PowerThe Baltic I Project

17. Financing Instruments EIB’s traditional loan products New financial instruments for sustainable energy • Carbon Finance platforms • Equity Platforms • Debt Funds Funds also for forestry, soil decontamination, energy efficiency, biodiversity Technical Advisory

18. INTERNATIONAL CARBON FUNDS • Multilateral Carbon Credit Fund (MCCF) • Carbon Fund for Europe (CFE) • EIB/KfW Carbon Purchase Programme • Post 2012 Carbon Fund RENEWABLE ENERGY FUNDS • Enercap Power Fund I • DIF Renewable Energy • Espirito Santo Infrastructure Fund • Platina European Renewable Energy Fund • SE European Energy Efficiency Fund OTHER FUNDS • Dasos Forestry • Gingko Soil Decontamination • OTHER FUNDS UNDER PREPARATION • Bio Diversity • Waste Recycling

19. Global reach of EIB action in climate changeCarbon Funds Russia 11% Other Central Asia 10% Other CEE 11% China 29% FEMIP 4% India 15% Other South Asia 9% AFRICA 1% Brazil 5% Other LATAM 6% Carbon Funds (ERPAs)

20. Climate-friendly Lending: technology • The EIB is scaling up support to accelerate the development, commercialization and diffusion of cost-effective early-stage low-carbontechnologies such as: • Photovoltaics • Off-shore wind • Concentrated solar power • 2nd generation biofuels • Carbon Capture and Storage • Recent further emphasis to RDI activities such as; • Engine and fuel technologies which reduce emissions from cars and airplanes • Energy-efficient smaller cars • Lending for CC-related RDI has grown considerably and reached about € 4.7bn in 2009

21. European Investment Bank Contacts Climate Action Operations: Christopher Knowles, c.knowles@eib.org Matthias Zöllner, m.zoellner@eib.org Climate Action Policy & Safeguards: Peter Carter, p.carter@eib.org Andrea Pinna, a.pinna@eib.org

22. Climate Action = Growth Opportunities "Climate change is a result of the greatest market failure the world has seen. The evidence on the seriousness of the risks from inaction or delayed action is now overwhelming. We risk damages on a scale larger than the two world wars of the last century. The problem is global and the response must be a collaboration on a global scale.” R. Stern

23. Green Components of National Economic Stimuli ($bn) Source: Bloomberg Energy Finance. EC analysis includes: EERP, Energy Efficient Buildings and Green Cars. 23

24. Green Components of National Economic Stimuli ($bn) Source: Bloomberg Energy Finance. EC analysis includes: EERP, Energy Efficient Buildings and Green Cars.

25. EIB RE & EE lending in the EU Region* 2005-2009 in €m • EIB has invested EUR 10 bn in the deployment of EU renewable energy (close to 30% of total energy lending) • A significant part of this investment (22%) has supported European RE manufacturing industries • In addition, EE investments have mounted to €2.2bn in the last two years 316 134 48 130 490 200 147 1241 125 1385 765 27 221 784 140 109 5 3 55 3 996 3 595 3 863 2270 64 * Includes EU 27, potential candidates and candidate countries 42

26. EIB lending to EU* solar energy 2005-2009 in €m • EIB lending has supported Innovative concentrated solar power (CSP) plants in Andalucia, Spain: Solucar Solar Thermal Power, Andasol and Solnova • EIB lending has also backed regional RE programmes such as Poitou Charentes photovoltaics regional plan and solar roofs in Germany 1285 300 2 858 * Includes EU 27, potential candidates and candidate countries

27. EIB lending to wind energy in the EU Region* 2005-2009 in €m • Active in offshore wind since 2002 • Funding volume: ~3,415 Meur • Supported capacity: 2,710 MW • Belwind (BE): first signed EIB PF project • Offshore wind involves larger project size than onshore windfarms • Offshore wind is still an emerging technology • High demand for EIB financing • Significant support to EU manufacturers 490 200 849 34 65 300 127 2 30 481 1030 64 * Includes EU 27, potential candidates and candidate countries