Smart finance for smart buildings: investing in energy efficiency in buildings
At its meeting on February 6, the Board of the European Investment Bank (EIB) approved the creation of a brand new financial instrument, the Smart Finance for Smart Buildings initiative. The aim is to make investments in energy efficiency projects in residential buildings more attractive to private investors, through the intelligent use of EU grants as a guarantee.
This new instrument, together with other EU policy initiatives for smart buildings, aims to unlock a total of €10 billion in public and private funds between now and 2020 for energy efficiency projects. It is estimated that this could support up to 220,000 jobs, and help establish a renovation market for small businesses worth up to €120 billion. In addition, up to 3.2 million European families could be taken out of energy poverty.
Commissioner for Climate Action and Energy, Miguel Arias Cañete, said:
I warmly welcome the EIB board’s decision. The building and housing sector accounts for 40% of Europe’s energy consumption, but it needs much more investment, and this initiative will help reduce the gap. It will also create local jobs and reduce energy poverty by using EU funds intelligently in a cost-effective way. This shows that ‘energy efficiency first’ is more than just a slogan: practical solutions such as the one approved by the EIB Board yesterday strongly support our transition to a low carbon economy and help us attain our Paris Agreement commitments.
The Smart Finance for Smart Buildings facility will improve use of public EU funding and will multiply the effect of the EU money invested. It will help to de-risk investments in the buildings sector, giving investors and financiers a better understanding of the risks and benefits of energy efficiency investments. Moreover, it will offer assistance with project development, as many households lack the skills and capacity to set up, implement and finance ambitious energy efficiency projects.