Private Sector Participation in Market-Based Energy-Efficiency Financing Schemes : Lessons Learned from Romania and International Experiences
Financing of energy-efficiency (EE) projects in a country almost always commences with public funds. Examples are energy service company (ESCO) businesses in the United States and Canada that were able to take advantage of public funds for public b...
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| Format: | ESMAP Paper |
| Language: | English en_US |
| Published: |
Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2003/11/2879916/private-sector-participation-market-based-energy-efficiency-financing-schemes-lessons-learned-romania-international-experiences http://hdl.handle.net/10986/19651 |
| Summary: | Financing of energy-efficiency (EE)
projects in a country almost always commences with public
funds. Examples are energy service company (ESCO) businesses
in the United States and Canada that were able to take
advantage of public funds for public buildings (World Bank
1999), most of the EE funds worldwide as compiled in a
recent Alliance to Save Energy report (ASE 2002), or various
EE projects funded by international financial institutions
(IFIs). A sustainable EE business can, however, develop only
if public funding is complemented by funding from the
private sector. In the past few years, some equity funds
with IFI and private sector participation have sprung up,
such as the Renewable Energy and Energy Efficiency Fund for
Emerging Markets (REEF) and Dexia-FondElec, and several
IFI/GEF projects in transition and developing countries have
experimented with various features that would reduce the
barriers for private sector involvement in financing EE
projects. The longest running of those financial schemes is
the Hungary IFC/GEF Guarantee Fund. In light of the lessons
learned from those projects, this report concentrates on the
example of Romania, where implementation of a World Bank GEF
project with a market-based EE financing mechanism has just
started. Until recently, Romanian energy consumers were
enjoying energy prices well below world market prices. With
restructuring of the energy sector, the energy price level
is now going up and subsidies are being phased out. Together
with restructuring and privatization in the industrial
sector, there are now incentives for investments in energy
efficiency that would reduce costs and improve the
competitiveness of Romanian companies. |
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