Rabobank committed to playing a key role in financing bioenergy industry

Quicknote bioenergy finance
The Frankfurter Allgemeine Zeitung reports that Rabobank has entered into a long-term commitment in relation to the development of sustainable energy solutions, both in the developed as well as in the developing world. The bank seeks to play a leading role in financing and stimulating clean energy. This commitment is stated in the Rabobank report entitled 'Financing and the emerging bio-energy markets' [*.pdf]. Rabobank and Robeco also employ the report to announce the launch of a new investment fund for clean technology. The fund is called Robeco Clean Tech Private Equity II and will contain approximately 500 million U.S. dollars.

The 'Financing and the emerging bio-energy markets' report was presented in Singapore in conjunction with the annual meeting of the IMF and the World Bank. The report puts forward recommendations for a transition to a more sustainable energy supply. This development is necessitated by sustained supply uncertainty and energy price fluctuations on the one hand and the growing threat of climate change on the other. The report looks specifically at the fast-growing market for bio-energy. A key conclusion of the report is that agriculture and forestry could play a key role in the near future with regard to supplying clean, more sustainable and more renewable energy:
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Biomass production must, however, be carried out in a responsible and sustainable manner. This market provides opportunities for both Rabobank customers and for Rabobank itself. Especially now that the prices of fossil fuels are rising, the alternatives are becoming increasingly more attractive and profitable.

Rabobank already has extensive activities in this area Rabobank invests in numerous projects, products, services and alliances that are aimed at improving the environment. The bank also encourages its customers to invest actively in energy, environmental and climate solutions. Rabobank furthermore employs non-financial criteria in its credit lending process, issues green bonds and develops sustainable investment funds in association with Robeco. The bank also trades in CO2 emission rights and develops sustainable real estate projects.

Developing countries are also not forgotten. Rabobank has confirmed its long-term commitment to the development of sustainable energy solutions and agriculture in developing countries where millions of people do not or virtually do not have access to energy. In dialogue with other NGOs and government agencies, the bank will continue to explore opportunities for implementing best practices in the field of sustainable agriculture and energy production.

We will be looking at this report in depth soon, together with another such report prepared by Swiss bank Sarasin, and analyse how these European banks define 'sustainability'. As may be apparent by now, the Biopact stresses social sustainability and not merely environmental durability. Both concepts have to be weighed off against each other.
As has often been suggested, chances are that European and American banks, NGO's, and governments will use the notion of environmental sustainability as a protectionist tool, to close off their markets for competitive biofuels from the developing world.[Entry ends here].