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Financing Residential Energy Efficiency in South-East Europe: Challenges and Opportunities

Explore the EBRD's experiences and initiatives in financing residential energy efficiency in South-East Europe, including credit lines, grants, and technical assistance. Discover the potential for capturing this energy efficiency potential in the region.

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Financing Residential Energy Efficiency in South-East Europe: Challenges and Opportunities

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  1. Financing Residential Energy Efficiency in South-East Europe • Gianpiero Nacci • Head of Sustainable Resources Investment, EBRD • Residential Energy Efficiency in South-East Europe – Challenges and Opportunities, Brussels • 20th June 2017

  2. What is the EBRD • Multilateral financing institution established in 1991 to support transition to market economies • Owned by 65 countries, the EU and the EIB • €30 billion capital base • €41 billion portfolio • €8.9 billion average annual business in the past 3 years • 3 key operational principles • Sound banking • Transition impact • Environmental sustainability

  3. Green Economy Transition (GET) 40% Green finance in EBRD annual business by 2020, from a 2015 level of 30% € 4 billion Target annual EBRD green business by 2020 €22billion Target cumulative EBRD green business 2006-2016

  4. EBRD’s green financing • €22.2 billion • cumulative EBRD green • financing 2006 - 2016 • 1,271projects • with climate components • 33% • of 2016 business

  5. EBRD’s experiences in financing residential energy efficiency • since 2006 • Annual Green impact • 1385 • 22.4% • 441 • € • million • GWh of primary energy • saved per year • of EBRD’s total green investment in buildings. • investedin residential buildings energy efficiency improvement across • 349,000 • 38 • projects, • and accounts for • tonnes CO2 eq. • reduced per year

  6. Bulgaria: Residential Energy Efficiency Credit Line (REECL) • Through REECL, the EBRD offers credit lines to local partner financial institutions in Bulgaria for on-lending to individuals and housing associations investing in residential energy efficiency. • REECL Key Facts • Financing framework: €110 m • €50 million (2005-10) • €40 million (2011-14) • €20 million (2016- ) • KIDSF support of €24.6 million for incentives and technical assistance • Amount signed with PBs: €99.4 m • Number of projects: 53,345 (~ 8,000 per year) • Energy savings: 240 GWh per year • Carbon reductions: 249,000 tons CO2 per year • EBRD • KIDSF • Funded Contract • Credit Line • € • Training • and Marketing • Support • Project • Consultant • Participating • Banks (PBs) • € • Loan Agreement • Confirms • Sub-Project compliance; • Verifies implementation • Sub-Borrower • (SBs)

  7. REECL: Case study • After: 146 kWh/m2.a • Costs: EUR 28,000 • IRR: 16% • Insulation of external walls of the two main facades • Replacement of windows in apartments • Before: 178 kWh/m2.a Pazardjik, 19 D.Debelianov str. Apartment building of 10 apartments

  8. Launch of “REEP Plus” in 2017 • REEP Plus is an integrated package of finance, technical assistance and policy dialogue, implemented jointly with the Energy Community Secretariat • €20m direct EBRD financing €4.5m grants (EU IPA + Other Donors) • Direct loans to the State, cities or municipal companies • Focus on public buildings EE • Capital expenditure grant co-financing and TA Objective Sustainable market for energy efficiency in the Western Balkans Window 4 Direct Lending to Municipalities • €108m EBRD & KfW financing via FI €27.05m grants (EU IPA + Other Donors) • SME and public sector lending (KfW) • Residential sector lending across all 6 WB countries (EBRD). €1.8m WBIF, €2.7m Austrian Federal Ministry of Finance for TC • €30m direct EBRD financing €1m grants (EU IPA + Other Donors) • Direct lending for Medium scale RE, EE • Target financing of ESCOs • TA for project preparation Window 2 Intermediated financing & Window 3 Direct financing Window 1 ESCO support & Policy dialogue • ESCO development • €3m grants (EU IPA + Other Donors) • TA for ESCO projects and tenders preparation • Policy dialogue • €2.5m grants (EU IPA) • Key focus on residential sector regulations

  9. Conclusion • Western Balkans’ residential energy efficiency potential unrivalled • Significant opportunities to capture this potential • Credit lines that engage private banks key to capturing this potential

  10. Gianpiero Nacci Associate Director Head of Sustainable Resources Investment EBRD • NacciG@ebrd.com • One Exchange SquareLondon, EC2A 2JN United Kingdomwww.ebrd.com

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