The lending arm of the European Union announced that it will eventually cut financing to most fossil fuel projects beginning in about two years.
The European Investment Bank, which has close to 555 billion Euros ($612B U.S.) in lending power, announced a new policy focused on ending financing for fossil fuel projects by 2021. Certain member nations, including Germany and Italian, are pushing for loopholes to the future policy.
“When the world’s biggest public lender decides to largely ditch fossil fuels, financial markets across the globe will take notice,” said Kate Cahoon, Germany Campaigner for global environmental group 350.Org. “The gas lobby has unfortunately managed to get Germany and the European Commission to insert some loopholes… They had better take note of the growing list of pipelines, terminals and fracking wells that are scrapped thanks to local opposition and the unprecedented masses of people mobilizing for climate justice.”
The decision was considered last month but delayed. Last week, however, EU finance ministers unanimously supported the move, according to reports.
The European Investment Bank loaned an average 6.2 million Euros per day on fossil fuel projects in the previous five years, according to 350.Org. In the United Kingdom, which is possibly leaving the EU, gas-fired power accounts for close to half of the electricity generation mix.
In mainland Europe coal-fired power capacity has dropped dramatically in recent years, while gas-fired power was on a longer, steadily decline in the past decade. Falling prices, however, pushed EU gas generation to rise 12 percent in 2017 alone, according to the International Energy Agency.