The European Commission, the European Investment Bank (EIB), the Cassa Depositi e Prestiti (CDP) and Deutsche Bank announced the launch of the European Energy Efficiency Fund, to provide market-based financing for public energy efficiency and renewable energy projects within the European Union.
The fund is the centrepiece of a new sustainable energy facility that the European Parliament and Council of Ministers agreed to launch using unspent funds from the European Energy Programme for Recovery. It will support EU member states in meeting the 2020 objectives of reducing greenhouse gas emissions by 20 per cent, increasing renewable energy use by 20 per cent, and lowering energy consumption through a 20 per cent improvement in energy efficiency.
The fund will have a two track investment approach, either investing directly in projects or via financial institutions. It has a layered risk/return structure to stimulate private investment with a fixed commitment of EU budget funds.
The European Commission is investing €125 million in the junior tranche of the fund, partly assuming the economic risks associated with the investment projects. The European Investment Bank is committing €75 million with CDP contributing € 60 million and Deutsche Bank, which will act as investment manager of the fund, €5 million.
The fund aims to raise the total volume from the current €265 million, to approximately €800 million by attracting further investors. Philippe Maystadt, EIB President, said, “We expect the fund to focus on smaller scale investments by local authorities or energy service companies, thereby complementing the larger scale finance that the EIB already offers for energy efficiency investments throughout the European Union.”
Caio Koch-Weser, Vice Chairman of Deutsche Bank, said, “By working together to address climate change, the public and private sector can jointly achieve much more than each by itself.”
More at the EIB’s website - European Energy Efficiency Fund EEEF launched
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