EIB lends EUR 70 mln for energy efficiency upgrading in Bucharest

Newsroom 20/12/2010 | 14:28

The European Investment Bank (EIB) is lending EUR 70 million to the Municipality of Sector 6 in Bucharest to finance energy efficiency (EE) refurbishments of multi-storey residential buildings in Romania’s capital.

The EIB loan will co-finance (50 percent of the project cost) the thermal rehabilitation of 273 multi-storey residential buildings over the period 2011–2013. The additional funding to complete this multi-annual program will be sourced from state subsidies allocated by the Ministry of Regional Development and Tourism, as well as other municipality funds.

“EIB funds will help to reduce by roughly 50 percent the energy consumption of the buildings covered by this thermal rehabilitation project. The total energy saved will amount to about 160 GWh a year once the program is fully implemented,” said Matthias Kollatz Ahnen, EIB Vice-President with responsibility for lending in Romania.

The energy savings cover 30 percent of the investment cost in net present value terms at current tariffs which are subsidized. Were tariffs to fully reflect the costs of heat generation, the energy savings could increase to about 60-70 percent of the investment cost, reflecting the overall savings including subsidy costs achieved by the project.

To date in 2010, the Bank has lent EUR 1.3 billion for energy efficiency projects (EUR 1.5 billion in 2009 and EUR 730 million in 2008).

Since 1990, EIB lending in Romania has reached approximately EUR 8 billion to finance investment projects covering all the country’s major economic sectors, ranging from basic infrastructure in the fields of transport, health, energy and the environment to manufacturing and services, including support for small and medium-sized enterprises via local financial institutions.