SUSTAINABLE ENERGY AND RESOURCE EFFICIENCY FINANCE

Challenges

Economies in emerging markets increasingly need to rely on renewable energy sources as well as implement energy and resource efficiency measures in the face of rising energy prices and potential energy shortages. Outdated generation facilities need to be upgraded in order to avoid energy losses and ensure an ongoing energy supply despite increasing demand. Meanwhile, end users still deploy outdated equipment and technologies, leading to further energy waste and CO2 emissions. Experience shows that investments in renewable energy (RE) as well as in energy and resource efficiency on a wider scale are the most advantageous ways of saving energy resources and costs. Such investments have short payback periods, attractive return rates, and debt service can often be covered by cost savings. Given increasing prices for energy and resources worldwide, companies that recognize the importance of energy and resource efficiency today will have a competitive advantage tomorrow.

Though the importance of energy efficiency in the industrial and residential sector as well as renewable energies for on- and off-grid electricity generation are widely recognized, many commercial finance institutions are still hesitant to finance RE and energy and resource efficiency projects. Further obstacles preventing such projects from being financed include legislative and regulatory frameworks, particularly for RE development, a lack of economic incentives due to artificially low energy tariffs, limited local capacities to prepare project proposals, and general lack of awareness of the benefits of implementing these measures.

Furthermore, many banks are unfamiliar with RE and energy and resource efficiency financing, and perceive lending to these sectors rather a risk than a means of diversifying their portfolio.

 
GFA concept and services

GFA’s Financial Systems Development department supports local partner financial institutions in the launching and marketing of RE & energy and resource efficiency facilities and assists in the development of respective lending activities as a sustainable banking business. Our experts offer field-proven concepts, ensuring the application of best practices in RE & energy and resource efficiency finance. 


Marketing

GFA ensures a timely launch of the facility and prepares a marketing concept with partner financial institutions. This includes a well-designed, user-friendly facility website, media work and promotional materials such as brochures, leaflets and case studies. We also offer portfolio screening support to identify potential sub-borrowers in the existing client database, organize public events dedicated to attract new clients, and stakeholder relationship management.

Project identification and portfolio development 

GFA supports companies and public entities in the identification of energy losses, conduction of energy assessments, and identification of technical solutions. Our experts assist in the search for suppliers, in technical and financial project assessment, and in the preparation of bankable project proposals, both independently and in cooperation with consortium partners. 

Capacity building  

GFA offers and organizes training and skill transfers to relevant stakeholders. Standardized training modules for bank officers incorporate sales techniques, portfolio screening, project appraisal, and risk analysis. Technical staff is trained in energy audit and project management.

Project management  

GFA mobilizes highly qualified expert teams matched to each project’s specific needs. GFA consultants closely monitor and coordinate project activities and implement knowledge transfers from similar programs, reflecting the key to the company’s approach to RE & energy and resource efficiency financing.
 

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