A European climate bank? Yes, but it already exists!


In recent tribune at "Parisien-Aujourd'hui en France", Jean Jouzel and Pierre Larrouturou propose the creation of a climate bank and a European budget dedicated to the ecological transition. In "The Express" former minister Nicolas Hulot urges Europe to invest more in ecology.

All these ideas are excellent. Yes, the EU must absolutely help its member states to finance the fight against climate change. But there is better: not only is Europe already investing heavily in the energy transition, but the "climate bank" also exists, although it is not so called. It is the European Investment Bank (EIB).

A quarter of climate investments

Bank of the European Union, of which all the Member States are shareholders, the EIB has made the fight against climate change one of its main areas of intervention. Ten years ago, it played a pioneering role in the market for green bonds by issuing the world's first "climate-responsible obligation" (OCR).

Today, the EIB spends at least 25% of its total investments on climate change, representing € 19.4 billion in 2017. It is the largest climate funder in the world. all multilateral donors. And our ambition is particularly high. In line with the commitments made in the Paris Agreements at COP 21, the EIB will invest 100 billion dollars in this area by 2020, which will reduce the risks for private investors and help mobilize them more widely. as well.

Concrete, in France

These billions may seem very theoretical. Yet they are concrete. In Cestas, Gironde, the EIB co-financed the largest photovoltaic power plant in Europe. We also financed almost all trams and metros in the cities of France.

The EIB also supports the energy transition of private and public buildings by financing third-party finance companies, which then make loans accessible to individuals for the renovation of their homes. Contracts already signed reduce the cost of thermal renovations for more than 20,000 of them in France.

One of the best examples is that of SPEE, in the Hauts-de-France, to whom we granted 23.5 million euros in 2015 to help it lend on attractive terms to individuals doing renovation work . The results are spectacular: with an average monthly payment of 147 euros of credit repayment, households have made about 100 euros in energy bill savings each month, not counting the value taken by their property.

Go further

This point perfectly illustrates the interest – and the difficulty – of a "climate bank". Our intervention is only relevant if it allows third-party finance companies to lend their clients interest rate the lowest possible. We must therefore be able, ourselves, to refinance ourselves on very advantageous terms with the markets. And this, the EIB achieves because the quality of its balance sheet – and the support of the Member States of the European Union – allows it to display the best possible ratings (AAA). Therefore, any new "climate bank" will have to finance itself at even lower rates than the EIB, which would require a high amount of capital …

Let's stay modest, however. Despite the joint efforts of the European Commission and the EIB, the financial means are still insufficient in relation to the scale of the needs. We are all in agreement, basically! Yes Europe must do more for the fight against climate change. But let's use what already exists and have worked for sixty years – the EIB – to use it more and even better.

Ambroise Fayolle

is Vice President of the European Investment Bank.