One of the Largest Banks in the World Will Stop Fossil Fuel Lending in by 2022

The European Investment Bank (EIB) in what some called a “game-changer” announced at the end of last week that it will phase out funding for fossil fuel projects by the end of 2021, dealing a major blow to oil and gas companies.  Instead, according to The Wall Street Journal, the bank will “use €1 trillion ($1.1 trillion) for climate-change action and environmentally sustainable investment by 2030 and help the EU reach 32% renewable energy across the bloc by 2030.”

Why This Matters:  We can think of 1.1 trillion reasons.  And this policy covers ALL fossil fuels including traditional natural gas projects.  That is huge – the EIB is the world’s largest multilateral lender and last year provided €55.6 billion in loans. It shows that Europe is putting its money on reaching climate change targets — funding its version of the Green New Deal — a proposed $13 trillion spending package that is a central part of the plan put forth by incoming European Commission President Ursula von der Leyen’s of Germany.  She will take over the EU in December, serving as its first woman President.  This is further evidence that women in high office enact more strict climate regulations.

The EIB Will Fund Many Renewable Energy Projects

At the same time, the Bank announced it will invest €1.5 billion to support renewable energy and energy efficiency projects around the world, “including 15 solar plants in Spain, new wind farms in Austria and Lebanon, and projects in France, Kazakhstan, the South Caucasus region, Latin America and Africa.”

“We will stop financing fossil fuels and we will launch the most ambitious climate investment strategy of any public financial institution anywhere,” said EIB President Werner Hoyer in prepared remarks.

According to The Guardian, environmental groups were pleased even though the EIB’s announcement comes a year later than hoped by climate campaigners.  Experts expect the decision to be especially difficult for the natural gas industry because they had more than $200bn in liquefied natural gas projects planned over the next five years.   Other fossil fuel companies will also feel the loss — it is estimated that the EIB loaned €6.2m every day to fossil fuel companies between 2013 and 2018.

As one campaigner put it, “When the world’s biggest public lender decides to largely ditch fossil fuels, financial markets across the globe will take notice: this is the beginning of the end of climate-wrecking fossil fuel finance.”

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