EBRD launches EUR 60 million energy efficiency facility for SMEs in Romania

The EBRD has launched a EUR 60 million program for small and medium-sized enterprises (SMEs) in Romania to improve their energy efficiency. The program will fund sustainable energy investments. The funds will be channeled to Romania’s real economy, through local financial intermediaries, including banks and leasing companies.

The EBRD is extending the first loan in the program, worth EUR 20 million, to Banca Comerciala Romana (BCR), Romania’s largest commercial bank and part of the Austrian Erste Group.

The Romanian SME Sustainable Energy Financial Facility (RoSEFF) will help local companies maximize energy savings and improve their overall competitiveness, while contributing to a reduction in the country’s high energy intensity.

The proceeds of the loan will be used to finance SME investments in improving industrial operations and premises, replacing equipment, software, and general upgrading aimed at reducing final energy consumption or producing renewable energy on a small scale. Individual sub-loans are limited to EUR 1 million and thus the focus is on smaller-scale investments.

Sub-borrowers undertaking energy efficiency investments will be reimbursed by up to 10 to 15 per cent of the sub-loan amount on the successful completion of the works. The size of the reimbursed grant will depend on the technology and the energy savings achieved as a result of the project.

The EBRD has a longstanding relationship with BCR having previously provided a number of loans for on-lending to local enterprises, including EUR 30 million under the ongoing EU/EBRD Energy Efficiency Finance Facility framework. Since January 2008 BCR has supported 25 energy saving investment projects under this framework.

The implementation of RoSEFF is supported by a planned EUR 12.05 million grant financing from the European Union. This funding will be used to support investment projects through technical assistance and reimbursement grants.

Since the launch of the EBRD’s Sustainable Energy Initiative in 2006, the Bank provided over EUR 468 million for energy efficiency investments in Romania, with total project value of close to EUR 1.8 billion.