Hotel Falkensteiner, Belgrade April 15, 2013

1. IFC – Renewable Energy in Serbia Hotel Falkensteiner, Belgrade April 15, 2013 Nebojša Arsenijević Balkan Renewable Energy Program Manager

2. IFC – World Bank Group MIGA Multilateral Investment and Guarantee Agency IBRD International Bank for Reconstruction and Development IDA International Development Association IFC International Finance Corporation Est. 1945 Est. 1960 Est. 1956 Est. 1988 Role: To promote institutional, legal and regulatory reform Governments of member countries with per capita income between $1,025 and $6,055. - Technical assistance - Loans - Policy Advice To promote institutional, legal and regulatory reform Governments of poorest countries with per capita income of less than $1,025 - Technical assistance - Interest Free Loans - Policy Advice To promote private sector development Private companies in 181 member countries - Equity/Quasi-Equity - Long-term Loans - Risk Management - Advisory Services To reduce political investment risk Foreign investors in member countries - Political Risk Insurance Clients: Products: Shared Mission: To Promote Economic Development and Reduce Poverty

3. IFC – Internal Structure Advisory Services (AS) Investment Services (IS) Access to Finance (A2F) Finance Market (FM) Infrastructure and Natural Resources (C3P) Investment Climate (IC) Sustainable Business Advisory (SBA) Manufacturing, Agribus. and Services (MAS) Public – Private Partnership (PPP)

4. Western Balkans Region and BREP Program funded by: Austrian Ministry of Finance (BMF) End Date: June, 2016

5. BREP Objectives • Objective 1: RE Regulatory Framework Improvements • Identification of legal (regulatory/contractual) obstacles • Draftingof improved legal framework • Raising awareness related to the new legal framework • Support during the adoption process • Objective 2: Support to RE Sponsors / Developers • Information/Knowledge sharing • Project development support • Connection with international sponsors • Objective 3: Support to Financial Institutions (Banks) • Information/Knowledge sharing • Dedicated Capacity Building - Trainings • Impact Assessment Studies

6. O1: Regulatory Framework - Approach PRE-IMPLEMENTATION ACTIVITIES Scoping Mission with stakeholders Coop. Agreement Ministry – IFC Consultant Select. Process Signed Contract with Consultants IMPLEMENTATION ACTIVITIES Phase 4 Workshop Phase 3 Official Meeting Phase 2 Drafting Phase 1 Inception POST-IMPLEMENTATION ACTIVITIES (AS AND WHEN NEEDED) Supporting Ministry /Government Decrees Supporting Ministry in Parliament New / Amended Laws Supporting Agencies Other secondary regulation

7. O1: RE Regulatory Framework - Activities

8. O1: RE Regulatory Framework - Example • Power Policy and Off-take related set of legal documents: • Renewable Energy Law and bylaws (Decrees) • Standardized Power Purchase Agreement • Standardized Grid Connection Agreement • Concession related set of legal documents: • Concession Law • Standardized Concession Contract • Selection Criteria for RE Concessions • Main targets: • To increase transparency and cash flow predictability • Mitigate Risk (standardized contracts, step-in rights) • Alignment with EU directives

9. O2: Support to RE Sponsors - Approach Market Level Interventions Educational Workshops Educational Materials (brochures, roadmaps, etc.) Support to Local Associations Investment Promotion Activities Local – International Match Making Support in Improving Project Documents Relationship with local community Support with E & S standards (Equator Principles) Support in finance modeling Improvement of Outreach Strategy Company Level Interventions

10. O2: Support to RE Sponsors - Activities From B2B to Implementation

11. O2: Support to RE Sponsors - Example • Example 1: Austrian Company • Joint Venture with Albanian concession owner • Program of Activities (PoA) for SHPP in Albania and Serbia • Private Benefit: improved cash-flow (CERs selling) • Public benefit: education, link with PoA • Example 2: Bosnian Company • Support with SHPP cascade design improvement • Official review of idea design • Private Benefit: optimized SHPP design • Public benefit: education, brochure with common design mistakes • Main Targets • To support private companies with good projects and without IDD issue • To secure certain level of public benefits (education, brochure, etc.)

12. O3: Support to local FIs – Approach General Material Development Country Level Workshop Material Adjust. Country Needs In-depth Capacity Building Training Impact Assess Study Joint Assess of first 3 SHPPs Technical Manual: SHPP Engineering Manual SHPP Legal Manual SHPP Budgeting Manual SHPP Risk Management Manual Finance Manual: SHPP Finance products development and marketing Bank organization structure SHPP Cash Flow Tool SHPP Project Assessment/Evaluation Toolkit

13. O3: Support to local FIs – Activities

14. O3: Support to local FIs - Example • Example 1: In-depth training with local bank in Albania • 3- day training on SHPPs and project finance • Engineering, E&S, Budgeting, Legal, Financial • Private Benefit: new product, increased internal capacity • Public benefit: education, more SHPP project successfully financed • Example 2: Country level workshop for Serbian banks • Presentation of IFC AS product (training) • Presentation of IFC IS products (loan, equity, quasi equity, risk share) • Private Benefit: idea for new product • Public benefit: education • Main Targets • To increase internal capacity of local banks • To slowly change RE market from corporate to project finance.

15. BREP Team Dzenan Malovic Technical Specialist Sarajevo Office (BIH) DMalovic@ifc.org Dimitar Dimitrovski Policy/Legal Specialist Skopje Office (MAC) DDimitrovski@ifc.org Bajame Sefa Finance Specialist Tirana Office (ALB) BSefa@ifc.org Nebojsa Arsenijevic Program Manager Belgrade Office NArsenijevic@ifc.org Shpresa Kastrati Technical Specialist Prishtina Office (KOS) SKastrati@ifc.org Denis Mesihovic Finance Specialist Sarajevo Office (MNE) DMesihovic@ifc.org Bojana Ristic Outreach Specialist Belgrade Office (SRB) BRistic@ifc.org