€2 million loan to microfinance institution Kreditimi Rural i Kosoves to support households’ efforts to save energy and money
The EBRD is providing a loan of up to €2 million to Kreditimi Rural i Kosoves (KrK), the third-largest microfinance institution in Kosovo, to deepen its financing of the green economy.
The funds will be on-lent to borrowers from the residential sector for investments in technologies which help to reduce energy intensity and improve energy efficiency in accordance with the EBRD Green Economy Transition (GET) approach. With these investments households will not only become more energy efficient but will also decrease their greenhouse gas emissions, reducing their impact on the environment.
The latest loan is provided under the Green Economy Financing Facility (GEFF) for the Western Balkans, a regional facility that has been launched to support residential energy efficiency investments in the Western Balkans. The facility is supported by grant funding from the European Western Balkans Joint Fund under the Western Balkans Investment Framework, the European Union (EU) and Austria.
Charlotte Ruhe, EBRD Managing Director Central and South Eastern Europe said: “We are very pleased to sign this loan agreement with KrK today. It marks a milestone in our cooperation and for Kosovo itself. With KrK our efforts to support green investments will achieve a much wider outreach thanks to our partner’s strong track record and capacity for green projects. This is particularly important as energy efficiency and energy savings are crucial for Kosovo’s further sustainable growth and development.”
Luigi Brusa, Head of Cooperation Section at EU Office in Kosovo said: "The importance of energy efficiency investments is to help Kosovo implement its national plan for energy efficiency as required by the Energy Community Treaty. Sustainable energy development is a top priority of the European policy. Increasing energy efficiency, reducing the reliance on imported energy sources, while increasing the use of renewable energy are the key objectives introduced in the Energy Community of South East Europe, including Kosovo."
A substantial proportion of the EU's assistance in Kosovo has been invested in revitalising the electricity sector, and more importantly over €20 million was spent on increasing energy efficiency and another €10 million is earmarked for supporting the upcoming Energy Efficiency Fund.
During 2011-15 the EU joined forces with the EBRD in implementing the Kosovo Sustainable Energy Project (KOSEP) through a blending mechanism of a €3 million EU grant and EBRD financing of €12 million. The purpose of the project was to implement energy efficiency and renewable energy investments in small and medium-sized enterprises and household sectors.
KrK was established in 2000 and provides finance to low-income individuals in rural and urban areas of Kosovo, prioritising the agricultural sector but also servicing other economic activities with a network of 22 branches throughout the entire territory of the country.
KrK became an EBRD client in 2012 when the Bank provided a credit line for small enterprises. One year later, KrK joined KoSEP and has on-lent €3 million to support energy efficiency.
Lulzim Sadrija, CEO of KrK said: “We are pleased to be an EBRD client and to benefit a new loan of €2 million to further support our clients with sub-loans for green investments in order to increase energy efficiency and saving of energy.” The EBRD launched GET in 2015. Building on a decade of successful green investments, the approach seeks to increase the volume of green financing from an average of 24 per cent of EBRD annual business investment in the 10 years up to 2016 to 40 per cent by 2020.
The EBRD has invested more than €225 million in 51 projects in Kosovo. The Bank’s strategic priorities in the country are promoting inclusion, the green economy, economic resilience and regional integration. The majority of the Bank’s investments are in the private sector.