Designing Credit Lines for Energy Efficiency
Many economically attractive opportunities to invest in energy efficiency are forgone because of various market barriers, notably the limited availability of commercial financing for energy efficiency projects. Once a government decides, as a matte...
| Main Authors: | , , |
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| Format: | Brief |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://hdl.handle.net/10986/18410 |
| Summary: | Many economically attractive
opportunities to invest in energy efficiency are forgone
because of various market barriers, notably the limited
availability of commercial financing for energy efficiency
projects. Once a government decides, as a matter of policy,
to scale up energy efficiency, it typically must engage
commercial banks to provide financing to the private end
users who will carry out the energy efficiency projects
needed to make the national policy a reality. Credit lines
help banks establish an energy efficiency business line by
mitigating the perceived high financial risk of energy
efficiency projects and of the energy service companies that
carry them out, and sometimes by building into the credit
line a technical assistance component to improve
understanding of the fundamentals of energy efficiency
projects. Energy efficiency credit lines make funds
available to participating financial institutions (including
local banks). The success of a credit line depends to a
great extent on the selection of competent and committed
financial institutions. A technical assistance component
built into the credit line helps lower the technical and
financial risk of projects. |
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