Translated version of this PSD: Mongolian
The Mongolian Sustainable Energy Financing Facility (MonSEFF) will be the first sustainable energy financing facility established by the European Bank for Reconstruction and Development (EBRD) in Mongolia to provide financing for sustainable energy measures that go beyond a business-as-usual development scenario.
MonSEFF will be structured to provide
- Medium term credit lines extended to privately owned Participating Financial Institutions (PFIs) to be used for on-lending to private sector companies to finance sustainable energy investments and
- Technical assistance to both PFIs and their clients to support investments in a broad spectrum of industrial sectors (e.g. agribusiness, manufacturing, services).
MonSEFF will be supported by a technical cooperation programme for business and product development, as well as supporting the origination and assessment of eligible investments. This includes support to develop a project pipeline, product guidelines and may also support the PFI's associated marketing campaign(s) and staff training module(s).
This pilot facility in Mongolia is expected to attract a minimum of one PFI with another PFI potentially joining the Facility in the future.
MonSEFF will generate transition impact by demonstrating the benefits of energy conservation and promoting the early adoption of sustainable energy financing. MonSEFF will demonstrate the effects of rational energy utilisation for improving industrial competitiveness as energy costs rise in Mongolia.
This pilot facility will introduce a new energy efficiency financing product to the market to support investment in the industrial and commercial sector. It is expected to transfer and build expertise related to sustainable energy investments among financial institutions and sub-borrowers. The PFIs will build expertise in assessing the risk of energy efficiency investments and enhance their capability in identifying clients and projects with energy savings potential. Sub-borrowers are expected to recognise the technical and financial benefits of Sustainable Energy Investments to improve their operations.
MonSEFF will be available to Participating Financial Institutions (“PFIs”) in Mongolia, the first of which is expected to be an existing client of the EBRD, XacBank.
The proceeds will be used for on-lending to private sector companies and SMEs for sustainable energy investments (industrial renewable energy and energy efficiency projects).
US$ 25 million.
US$ 25 million.
Categorised FI. Participating financial institutions will be required to comply with the EBRD's performance requirements 2 and 9 and submit annual environmental and social reports to the Bank, including reporting on sub-projects. Sub-projects will be required to comply with national standards for environment, health and safety and labour and, where relevant, EBRD E&S eligibility criteria for on-shore wind and small hydro projects.
The Technical Cooperation will be aimed at supporting the identification of sustainable energy projects (e.g. via energy audits, training to loan officers, marketing support, etc.) and to build capacity in sustainable energy lending within the PFIs joining the programme. Funding for technical cooperation is yet to be secured.
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