Germany: EIB Group boosts financial support for green and innovative projects (2024)

  • EU climate bank increases financing in 2022 by 20% to €6.61billion.
  • 75% of all financing in Germany went to innovative and climate-friendly projects.

2022 was a successful year for the European Investment Bank (EIB) Group in Germany, with overall financing increasing by 20% to €6.61billion compared with the previous year. With the new government dedicated to greening the economy, both private and public companies turned to the EIB for support for long-term investments in renewable energy and energy efficiency projects.

EIB projects are diverse. In 2022, the EU bank invested in new trams and trains and in innovative battery trains that will replace diesel locomotives in the greater Berlin area. The EU-bank financed wind farms and invested in the upgrade of power grids with TenneT. We invested into Vaillant`s RDI and new production lines for heat pumps and into PBT`s factory for car battery materials.

“In Germany, we have observed a growing interest in projects that contribute to the green transition of industry,” EIB President Werner Hoyer says. “With energy security being high on the political agenda since Putin attacked Ukraine, we hope that the trend towards renewable energy will become even stronger. Becoming independent from fossil fuels will help us to become independent from autocracies like Russia, while at the same time protecting the climate.”

In Germany, the EIB has alreadyexceeded its overall targetof devotingat least 50% ofits total annualfinancing to climate and environmental actionby2025, reaching more than two thirds in 2022.

We also supported the energy-efficient modernisation of affordable and social housing with the public housing company hanova. This was the first project in Germany financed under the European Union’s InvestEU programme. InvestEU backs EIB Group loans with guarantees provided via the EU budget. It builds on the previous Investment Plan for Europe, also known as the Juncker Plan (EFSI).

“We are proud to have given a boost to the green transition in 2022,” says EIB Vice-President Ambroise Fayolle, who has oversight for the EU bank’s business in Germany. “We will continue to invest in protecting the climate in the years to come too.”

Another focus of the EIB Group in 2022 was innovation. For example, we financed AI-based exoskeletons that help construction workers lift heavy loads, improving workplace safety. In the life sciences sector, we financed the startup Numares, which has developed a tool to analyse blood and urine samples for a variety of infectious diseases by modifying PCR technology, the well-known COVID-19 testing technology.

Through our subsidiary, the European Investment Fund (EIF), we support smaller startups, mostly in cooperation with private investors such as the Green Generation Fund, which is run by women and specialises in the food industry.

Startup financing via the EIF has been a success in Germany. Of the €6.61billion in EIB Group investments in 2022, about €1billion was invested via the EIF.

In 2022, EIB Group financing in Germany mainly went towards projects in the categories sustainable energy and natural resources (€2.276billion) and innovation, digital and human capital (€2.566billion), representing 75% of total financing in the country. Innovation, digital and human capital also covers climate-related innovation.

Sustainable cities and regions, the category under which the battery train project falls, received €828million, while SME financing amounted to €942million in 2022.

Background information

The EIB’s activities focus on the following priority areas: climate and environment, development, innovation and skills, small and medium-sized businesses, infrastructure and cohesion. TheEIB works closely with other EU institutionsto foster European integration, promote the development of the European Union and support EU policies in over 140 countries around the world.

The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe’s micro, small and medium-sized enterprises (SMEs) by helping them to access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that specifically target this market segment. In this role, the EIF contributes to the pursuit of key EU policy objectives such as competitiveness and growth, innovation and digitalisation, social impact, skills and human capital, climate action and environmental sustainability, and more.

The InvestEU programme provides the European Union with long-term funding by leveraging substantial private and public funds in support of a sustainable economy. It helps generate additional investments in line with EU policy priorities, such as the European Green Deal, the digital transition and support for small and medium-sized enterprises. InvestEU brings all EU financial instruments together under one roof, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub, and the InvestEU Portal. The InvestEU Fund is implemented through financial partners who invest in projects using the EU budget guarantee of €26.2billion. This guarantee increases their risk-bearing capacity, thus mobilising at least €372billion in additional investment.

EIB and energy security: Over the past decade, the European Investment Bank Group has channelled more than €100billion into the European Union’s energy sector. These timely investments in energy efficiency, renewables, grids and storage are now helping Member States weather the crisis triggered by the abrupt cut in Russian gas supplies. In October2022, the EIB’s Board of Directors decided to raise the Group’s clean energy financing volumes in support of the REPowerEU objective of ending Europe’s dependence on Russian fossil fuel imports. An additional €30billion will be invested over the next five years, on top of the EIB’s already robust support for clean energy. It is estimated that the REPowerEU package will mobilise an additional €115billion by 2027, thus making a substantial contribution to Europe’s energy independence and the EIB Group’s target to mobilise €1trillion in climate finance this decade.

I am an expert in the field of climate finance and environmental sustainability, with a deep understanding of the European Investment Bank (EIB) and its activities. My expertise in this area stems from extensive research, analysis, and practical experience in the field of sustainable finance and green investments. I have closely followed the EIB's initiatives, policies, and impact on climate action, and I am well-versed in the various financial instruments and programs it utilizes to support sustainable development and innovation.

European Investment Bank (EIB) and Climate Financing in Germany

The European Investment Bank (EIB) significantly increased its financing in Germany in 2022, with a notable focus on innovative and climate-friendly projects. The EIB's overall financing in Germany rose by 20% to €6.61 billion compared to the previous year, reflecting a strong commitment to greening the economy and supporting long-term investments in renewable energy and energy efficiency projects ****.

Key Points:

  • Financing Allocation: 75% of all financing in Germany went to innovative and climate-friendly projects, indicating a substantial emphasis on sustainability and environmental impact ****.
  • Project Diversity: The EIB's projects in Germany encompass a wide range of initiatives, including investments in new trams, trains, innovative battery trains, wind farms, power grid upgrades, and support for the green transition of industry ****.

EIB's Focus Areas and Initiatives

In 2022, the EIB Group's financing in Germany was primarily directed towards sustainable energy and natural resources, as well as innovation, digital, and human capital, which collectively represented 75% of the total financing in the country ****. This underscores the EIB's commitment to supporting climate-related innovation and sustainable development in Germany.

Key Points:

  • Sustainable Energy and Natural Resources: The EIB allocated €2.276 billion towards projects in this category, emphasizing the importance of sustainable energy and resource management ****.
  • Innovation, Digital, and Human Capital: A significant portion of the financing, amounting to €2.566 billion, was directed towards fostering innovation, digitalization, and human capital, with a focus on climate-related innovation ****.

EIB's Role in Supporting Small and Medium-Sized Enterprises (SMEs) and Innovation

The EIB's activities in Germany also extended to supporting SMEs, innovation, and technological advancements. Notably, the EIB financed AI-based exoskeletons for construction workers and supported startups in the life sciences sector, such as Numares, which developed innovative diagnostic technology ****.

Key Points:

  • SME Financing: The EIB invested approximately €942 million in SME financing, demonstrating a commitment to fostering the growth and development of small and medium-sized enterprises ****.
  • Innovation and Technology: The EIB's support for innovative projects, such as AI-based exoskeletons and diagnostic technology, reflects its dedication to advancing technological solutions for societal and environmental challenges ****.

EIB's Contribution to Energy Security and Climate Action

The EIB has played a significant role in promoting energy security and climate action, particularly in response to geopolitical developments. The EIB's investments in energy efficiency, renewables, grids, and storage have contributed to Europe's efforts to reduce dependence on fossil fuel imports, especially in light of geopolitical challenges ****.

Key Points:

  • Geopolitical Context: The EIB's commitment to clean energy financing has been reinforced by the geopolitical context, including the need to reduce Europe's dependence on fossil fuel imports, particularly from Russia ****.
  • Investment Commitment: The EIB's decision to raise clean energy financing volumes by an additional €30 billion over the next five years underscores its dedication to supporting Europe's energy independence and climate objectives ****.

In summary, the EIB's activities in Germany in 2022 reflect a strong emphasis on climate financing, sustainable development, innovation, and energy security, aligning with its broader priorities and the European Union's policy objectives.

Germany: EIB Group boosts financial support for green and innovative projects (2024)
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