The European Investment Bank has confirmed plans to strengthen support for the Green for Growth Fund to enable new investment in small scale energy efficiency and renewable energy projects across North Africa, in Morocco, Egypt and Tunisia, as well as Lebanon, Jordan and the Palestinian Territories. Expanded geographic engagement of the specialist climate fund to the southern Mediterranean region will focus investment on projects that can generate high energy savings and significant CO2 reduction in countries that have high levels of fossil fuel use, limited renewable energy and restricted implementation of energy efficiency schemes.
“Unlocking new investment in renewable energy and energy efficiency is a global challenge and the Green for Growth Fund has an impressive track record that has already enabled more sustainable energy use in Southeast Europe and the European eastern neighborhood. The European Investment Bank is committed to strengthening the local impact of climate related investment and the planned expansion of the Green for Growth Fund to North Africa and the Middle East can help to reduce emissions and provide a sustainable alternative to fossil fuels use across the region.” said Jonathan Taylor, European Investment Bank Vice President.
The Green for Growth Fund provides dedicated credit lines to local financial and non-financial intermediaries, including commercial banks and microfinance institutions, for investment in renewable energy and energy efficiency schemes by local partners, such as businesses, households, municipalities and energy companies. Targeted technical assistance is also used to strengthen environmental and social impact assessment, energy audits and roll out energy efficiency focused credit lines.
Expansion of the Green for Growth Fund is intended to be finalized by the end of the year. The proposed additional EIB contribution of EUR 25 million, alongside EUR 50 million provided over the last 6 years, was approved earlier this week by the EIB's Board of Directors, representing shareholders from 28 European Union countries and the European Commission.
At COP 22 currently taking place in Marrakech, Morocco, representatives of the European Investment Bank and the Green for Growth Fund today highlighted how the initiative had already unlocked investment for projects that the EIB could not directly support and confirmed their shared commitment to support new energy efficiency and renewable energy projects.
“Ratification of the Paris Climate Agreement earlier this month represents a global commitment to tackle climate change and unlocking climate finance backed by public and private investors to ensure a local impact, as already successfully demonstrated by the Green for Growth Fund, has been recognized by countries around the world as essential.” added Jonathan Taylor.
“The EIB has played a key role in the creation of the Green for Growth Fund and remains one of the fund's leading partners. We are very pleased about the EIB's increased commitment, which will help the Green for Growth Fund to attract additional private investors and enable the fund to further expand and build on its proven support for energy efficiency and renewable energy.” said Elvira Lefting, advisor to the Green for Growth Fund.
The EUR 410 million Green for Growth Fund has been backed since 2009 by the EIB and co-initiator KfW, along with partners including EBRD, IFC, FMO, the German Ministry of Economic Cooperation and the European Commission and supported investment by final beneficiaries that saves an estimated 1,300,000 MWh and 329,000 tons of CO2 each year.
The new investment from the European Investment Bank reflects the strong track record of the Green for Growth Fund that until now has focused investment in climate related projects in south-eastern Europe, Ukraine, Moldova, Turkey, Armenia and Azerbaijan.
Finance in Motion, advisors to the Green Growth Fund, already have an office in Egypt, and a second permanent presence planned for Morocco is intended to strengthen cooperation with local banks and project companies. Finance in Motion also have offices in Frankfurt, Yerevan, Sarajevo, Bogota, Cairo, Tbilisi, Nairobi, Pristina, Luxembourg, Chisinau, Skopje, Podgorica, Istanbul, Belgrade and Kiev.
The European Investment Bank is the world's largest financial of climate action and last year provided EUR 20.7 billion for climate related investment across Europe and around the world.