In a candid interview with Paperjam, Gabriele Todesca, head of infrastructure at the European Investment Fund (EIF), shed light on the fund’s strategic focus and the state of Europe’s green transition. His insights reveal a sector in flux, grappling with political headwinds, evolving priorities, and the urgent need for energy self-sufficiency.
The EIF’s infrastructure group is zeroing in on greenfield assets, with a significant portion—over 50%—dedicated to energy infrastructure. This includes renewable generation, storage, transmission, and energy efficiency projects. Notably, the EIF has drawn a clear line in the sand: no investments in fossil fuels, including natural gas. This stance, while aligned with Europe’s decarbonization goals, may raise eyebrows given natural gas’ role as a transition fuel in some countries.
Todesca acknowledges the political backpedalling on green initiatives in the US and Europe but remains bullish on the sector’s prospects. He sees the green transition and energy security as complementary objectives, with Europe’s reliance on foreign energy sources laid bare by the Russian invasion of Ukraine. This dual focus is driving policy support for renewables and could accelerate Europe’s green transition, even as it grapples with immediate energy security concerns.
The EIF’s focus is shifting towards energy efficiency, reflecting a broader trend in the market. While the fund continues to invest in solar and wind, it’s also pouring money into energy storage, grid interconnectors, and efficiency projects. This pivot underscores a stark reality: Europe needs to generate more power from renewables, but it also needs to waste less. Todesca’s example of renovating hospitals with new electrical systems and smart meters drives home this point.
Yet, challenges remain. Connecting new power generation assets to the transmission grid is a persistent bottleneck. While Todesca is tight-lipped on specific regulatory changes, he’s clear that investment alone won’t solve this issue. Meanwhile, the EIF is exploring sustainable transportation projects, from dual-engine trains to hybrid ships. These investments hint at a future where clean energy powers not just our homes, but our journeys too.
So, how might these developments shape the sector? First, the EIF’s uncompromising stance on fossil fuels sends a strong signal to markets. It could spur a shift in private investments, nudging them towards renewables and energy efficiency. Second, the focus on energy security could drive policy support for renewables, potentially offsetting political pushbacks against the green transition.
Moreover, the EIF’s emphasis on energy efficiency could spark innovation in this space, driving demand for new technologies and services. This shift could also reshape energy markets, with efficiency gains reducing demand and easing pressure on grids.
Lastly, the EIF’s foray into sustainable transportation could catalyze similar investments. But it also raises questions. For instance, how will these projects compete with established, often cheaper, fossil fuel-based alternatives? And how will regulators balance the need for energy security with the imperative of decarbonization?
Only time will tell. But one thing’s clear: the EIF’s strategy is more than just a response to market trends. It’s a bold bet on a sustainable future, one that could reshape Europe’s energy landscape for generations to come. As Todesca puts it, “People don’t realise how much electricity we waste.” Perhaps it’s time we all start paying attention.
