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More grant funds for residential energy efficiency in multi-apartment buildings in Bulgaria
Investment incentives increased for EBRD-sponsored green residential projects
The European Bank for Reconstruction and Development (EBRD) and the Bulgarian government are supporting plans to increase investments to improve the energy efficiency of residential buildings in Bulgaria and reduce the energy intensity of the economy.
Donors supporting a fund for the decommissioning of Bulgaria’s Kozloduy nuclear power station have increased their financing for residential energy efficiency projects by €4.63 million to €14.63 million.
The funds are used partly to provide financial incentives to households investing in EBRD-sponsored energy efficiency measures. These incentives, provided in the form of grants, are being raised from 20% of the EBRD-sponsored loan to 30% where residents of apartment blocks join together to pursue energy efficiency measures that have an impact on the whole building.
Bulgaria - a country typical of many central and eastern European economies where endemic energy wastage remains a legacy of the communist past - consumes 2.5 times as much energy per capita compared with the average in the 25 countries that comprised the EU before the accession of Bulgaria and Romania in 2007.
Studies show that at least 35% of Bulgaria’s energy saving potential is in the household sector. Many buildings need external thermal insulation, modernization of the interior pipes network and windows replacement. Despite the huge technical and economic potential for investment various barriers prevent these improvements from being made.
With the aim of reducing the energy intensity of the economy and increasing the thermal performance and comfort of residential buildings, the EBRD, in close co-operation with the Bulgarian Ministry of Economy and Energy launched the EBRD Bulgarian Residential Energy Efficiency Credit Line (BREECL) in 2005. The €50 million facility is provided by the EBRD to six local participating banks that on-lend to households for home improvements with defined energy efficiency performance characteristics. These banks are United Bulgarian Bank, Unicredit Bulbank, DSK Bank, Raiffeisenbank, Bulgarian Postbank and ProCredit Bank.
The facility is complemented by the €14.63 million grant funds available from the Kozloduy International Decommissioning Support Fund (KIDSF)*, which are used for technical assistance and for incentives to households implementing energy efficiency and renewable energy projects financed under the BREECL. The extra grant funding approved will be used to increase the incentives made available to groups of households for energy savings measures that affect the whole apartment block, and not just individual apartments. Such measures have a greater performance economically, aesthetically and in terms of energy saved, yet are difficult to achieve in a context of mixed ownership and other barriers.
Jacquelin Ligot, EBRD Director for Energy Efficiency and Climate Change, said there is a tremendous potential for improvement in energy efficiency in Bulgaria, where energy waste is much higher than in most EU countries. The housing sector, and particularly apartment blocks, is an increasing area of priority for the EBRD but it is also a more challenging one, he added. The Bank is exploring new ways to work with all stakeholders in this task. This new funding provides the incentives for just that, Mr Ligot said.
Galina Tosheva, Deputy Minister of Economy and Energy, said that in Bulgaria increasing energy efficiency is a taskof high importance. Energy efficiency improvements in residential buildings is one step that shows great potential and leads to very good results for both households and the economy in savings of energy and CO2 emissions.
Households use the REECL facility to install high standard double-glazed windows, internal and external insulation, biomass stoves and solar water heaters, efficient gas boilers and heat pump systems.
As of 17 September 2007, the participating Bulgarian banks had disbursed over 10,000 energy efficiency home improvement loans totalling 30 million leva (€15 million) and 5 million leva (€2.5 million) of grants. This has led to estimated savings of 70,000 MWh per year and over 100,000 CO2 emissions per year.
* Donors of the Kozloduy International Decommissioning and Support Fund (KIDSF) are the European Community, Austria, Belgium, Denmark, France, Greece, Ireland, the Netherlands, Spain, Switzerland and the United Kingdom.
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