European Commission, EIB, EBRD, KfW Team up To Launch SEE Energy Efficiency Fund

The South East Europe Energy Efficiency Fund will have an initial volume of 95 million euro ($136 million) with the aim to increase it to 400 million euro over the course of four to five years by attracting additional funds from public and private investors, EIB said in a statement.

As initiators and co-lead investors, EIB and KfW Entwicklungsbank are each contributing 25 million euro to the fund. The European Bank for Reconstruction and Development will also provide 25 million euro and the European Commission 20 million euro, EIB said.

The fund will invest in Albania, Bosnia and Herzegovina, Croatia, Macedonia, Kosovo, Montenegro, Serbia and Turkey. It aims to contribute to the economic and environmental development of the region by helping public and private enterprises and households make investments in the areas of energy efficiency and renewable energy. This in turn should help Europe as a whole meet its climate goals.

The fund's initial focus is expected to be on investments in energy efficiency projects in the residential housing and small and medium-sized enterprise sectors while a pipeline of renewable energy projects, such as small-scale hydro-electric power, is built up.

The fund has been established as a Public-Private Partnership which seeks to leverage commercial capital from private institutional investors with the help of public funding.

The fund, registered under Luxembourg law as a Variable Capital Investment Company, will be accompanied by a grant aid facility of around five million. A first contribution towards the grant facility will be made by the Austrian Development Bank, EIB said.

($ = 0.6967 euro)