German Development Ministry contributes EUR 8 million to the Green for Growth Fund, Southeast Europe
- Proceeds to be used to finance energy efficiency and renewable energy investments in Southeast Europe
- Contribution supported by EUR 1 million in grants to the Fund's Technical Assistance Facility
Frankfurt am Main, September 2, 2010 - The German Federal Ministry for Economic Cooperation and Development (BMZ) has made an EUR 8 million contribution to the first-loss tranche of the Green for Growth Fund, Southeast Europe (GGF). The proceeds will be used to finance energy efficiency (EE) and small-scale renewable energy (RE) projects implemented by businesses and households within the region of Southeast Europe, where there is a substantial market for investment opportunities in EE and RE.
The BMZ contribution increases the Fund's size to EUR 128 million and enhances GGF's potential to leverage additional private capital for EE and RE finance in Southeast Europe.
The Fund has been established as a Public-Private Partnership. It uses grant funds provided by donor agencies to leverage private capital at large scale. This is achieved by issuing different tranches of risk, including a first-loss tranche which is typically reserved for donor agencies and provides a risk cushion for private investors. The aim is to increase the Fund's size to EUR 400 million over the course of five years by attracting additional public and private funds.
BMZ's contribution is supported by EUR 1 million in grants to GGF's Technical Assistance Facility. The funds will be used to support the GGF's partner institutions in developing financing instruments for EE and RE projects, to help design and implement such projects, as well as to increase the awareness about the benefits of EE and RE investments.
"The GGF will be able to leverage BMZ's contribution by up to eight times, generating over EUR 60 million in investments in the field of energy efficiency and renewable energy", said Monika Beck, Chairwoman of the Board of Directors of the GGF. "This will have a significant impact in reducing energy consumption and CO2 emissions in GGF's target region. The Fund is very pleased to have BMZ as a partner in this effort."
ABOUT THE GREEN FOR GROWTH FUND, SOUTHEAST EUROPE
Initiated by the European Investment Bank and KfW (The German Development Bank), the Green for Growth Fund, Southeast Europe (GGF, formerly Southeast Europe Energy Efficiency Fund) is dedicated to enhance energy efficiency and foster renewable energies in Southeast Europe, including Albania, Bosnia and Herzegovina, Croatia, FYR Macedonia, Kosovo (under UNSCR 1244/99), Montenegro, Serbia and Turkey. GGF provides refinancing to financial institutions for on-lending to small and medium-sized enterprises and private households for financing energy efficiency projects. The Fund also makes direct investments in specialist energy service companies (ESCOs), energy efficiency service and supply companies and renewable energy projects and public entities. The activities of GGF are supported by a Technical Assistance Facility. The Fund is a Public-Private Partnership. Its investor base comprises donor agencies, international financial institutions and institutional private investors. The Fund is registered under Luxembourg law as a Variable Capital Investment Company (SICAV). GGF is privately managed by Oppenheim Asset Management Services S.à r.l., Luxembourg, in consortium with the investment advisor Finance in Motion GmbH, Frankfurt/Main, Germany, and technical advisor MACS Management & Consulting Services GmbH, Frankfurt/Main, Germany.
Mr. Samir Djikić, Manager Communications
Tel: +49 (0)69 9778 7650-26