With support from Norway and the EU, EBRD credit line helps families save energy
Over 3,100 households in densely populated Kosovo are cutting their energy bills and enjoying more comfort at home after investing in energy-saving improvements through the Kosovo Sustainable Energy Projects (KoSEP), an EBRD credit line supported by Norway and the European Union.
The EBRD places huge emphasis on developing greener economies in the countries where it works, having committed to invest up to 40 per cent of its total financing in sustainable energy projects by 2020.
In the first five months of 2017 the Bank’s level of climate finance rose by 85 per cent, with €913 million invested compared to €493 in the same period last year.
Making home improvements for most people is a daunting and financially draining task. But renovations for energy efficiency benefit many more than individual residents.
At the national level they also contribute to reaching energy-efficiency targets and defending the environment by curbing greenhouse gas emissions. Hence the ever growing importance of promoting greener residential sector development.
To incentivise homeowners to take the necessary steps and to bypass investment hurdles, the EBRD credit line provides a one-stop-shop for lending through two local commercial banks and two micro financial institutions.
The energy efficiency credit available through KoSEP is worth €12 million. Norway and the European Union have provided grant support for technical assistance used by both financial institutions and potential sub-borrowers to find the best financing solutions, the best technologies required for long-term gains as well as cash rewards for borrowers for certified, successfully completed projects.
To date, €11.8 million have been disbursed for energy efficiency investments, largely in the residential sector but also for small businesses
The improvements introduced thanks to investments include insulation of so called “building envelopes” (outside walls, roofs and floors), efficient windows and external doors.
The loans can also be used for buying energy-efficient washing machines, refrigerators, new boilers and also renewable energy equipment using solar power and biomass.
Mr Sabit Seferaj, from the northern town of Istog, is one satisfied customer. “After a visit to a friend who had carried out home improvements, I took a KoSEP loan to apply thermal insulation to the outside walls of my 180m2 house,” he said.
“It’s a big house and being five in the family we need all rooms warm at all time, which used to cost us a lot.”
“Now you can feel the difference during both the summer and the winter. During the summer I don’t have to use any other cooling device and during winter right after completing the insulation works I realised that my electricity and fuel costs have been reduced by about one third.“
The credit line also encouraged energy-saving refurbishments in multi-story buildings, a complex form of project which requires agreement among residents of the whole building for borrowing funds.
Ian Smith, EBRD Head of Sustainable Energy Financing Facilities, said: “This very successful credit line helped achieve energy savings totalling over 25,000 MWh/y, enough to supply 5,000 Kosovar households with electricity for a whole year.
“KoSEP’s energy savings achieved by the end of May 2017 equal almost 12 per cent of Kosovo’s total energy-saving targets for the residential and service sectors.
“This is a great contribution to the implementation of the Kosovo Energy Efficiency Action Plan and Energy Efficiency Law, bringing the country closer to the EU.
“Besides the importance of each individual project, we are proud of our work with participating local financial institutions who have learned new skills in green financing which can replicated sustainably in the future”.
KoSEP has also directly and indirectly provided important support for the improvement of technical standards, capacity and tools for law enforcement of the legislation on energy efficiency of buildings.
To continue promoting climate finance in Kosovo and the rest of the Balkan region, the EBRD has established the Western Balkans Green Economy Financing Facility, credit lines for a total of up to €85 million to participating financial intermediaries in Albania, Bosnia and Herzegovina, FYR Macedonia, Kosovo, Montenegro and Serbia to finance more residential energy efficiency and small-scale renewable energy investments.
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.