FP009

Energy Savings Insurance (ESI) for private energy efficiency investments by Small and Medium-Sized Enterprises (SMEs)

Energy Savings Insurance (ESI) for private energy efficiency investments by Small and Medium-Sized Enterprises (SMEs)

  • Status Under implementation
  • Date approved 30 Jun 2016 at B.13
  • Est. completion 22 Jan 2024
  • ESS Category Category C

Improving access to financing for SMEs in El Salvador to replace energy-intensive motors, air-conditioning, refrigeration and boilers, increasing energy efficiency and developing a new market in energy services.

The project will develop a package of measures to encourage energy efficiency investments by SMEs in El Salvador. El Salvadoran SMEs, making up over 99% of the country’s enterprises, suffer from obsolete equipment, the result of low levels of investment, and limited access to long-term credit. There are no Energy Services Companies (ESCOs) and no market for financing longer-term energy efficiency projects, which are perceived as risky, unstructured investments. The energy savings insurance scheme developed will include risk-sharing contracts,  independent technical validation, insurance and specific financial instruments, significantly lowering investment risks for banks and SMEs.

GCF will loan USD 20M to BANDESAL (the National Development Bank of El Salvador), who will add USD 20M of their own resources. This will contribute to a credit line available for local banks to fund SME energy efficiency projects at concessional rates, to be repaid through future energy savings. Loan repayments will finance additional sub-projects thanks to the use of a revolving fund. The equipment targeted for upgrade is widely used and has large energy savings potential.

The project has an estimated lifespan of 15 years.

Total project value

 

Tonnes of emissions avoided

 

Theme

Mitigation

Result areas

Project timeline

Pipeline

12 May 2015 - 416 days

Concept note received

12 May 2015

Funding proposal received

31 Jul 2015

Approved

30 Jun 2016 - 937 days

Approved by GCF Board

30 Jun 2016

Cleared by iTAP

30 Jun 2016

Legal opinion on AE's Internal Approval

27 Jul 2018

FAA executed

24 Dec 2018

Under implementation

22 Jan 2019 - 613 days so far

FAA effective

22 Jan 2019

Disbursement - USD 1,700,000

30 Jun 2020

Disbursement - USD 2,000,000

30 Jun 2020

Completed

22 Jan 2024 - 1,214 days to go

One region

  • Latin America and the Caribbean

One country

USD  
  • Financing
    • Private sector
    • Public sector
  • Size
    • Micro
    • Small
    • Medium
    • Large

GCF financing9% disbursed

InstrumentAmount
LoanUSD 20,000,000
GrantUSD 1,700,000

Cofinancing

CofinancerInstrumentAmount
Co-FinancingLoanUSD 20,000,000

GCF Contacts

General media inquiries

GCF Communications
Phone +82 10 4458 7751
Send e-mail

Request for information

GCF Information Disclosure
Request information about this project

Project complaints and grievances

GCF Independent Redress Mechanism (IRM)
Phone +82 32 458 6157
File a complaint

Integrity issues

GCF Independent Integrity Unity (IIU)
Phone +82 32 458 6155
Send e-mail

Accredited Entity

Inter-American Development Bank

Ms. Victoria Eugenia Florez Toro
Chief, Resource Mobilization Division

National Designated Authority

El Salvador

Ministry of Environment and Natural Resources (MARN)

His Excellency Mr. Fernando Andrés López Larreynaga
Minister of Environment and Natural Resources (MARN)
Kilometro 5 1/2 Carretera a Santa Tecla, colonia y calle Las Mercedes, Edificios MARN, San Salvador, El Salvador
Mr. Antonio Cañas Calderon
Chief of Technical Cabinet and National Focal Point to the UNFCCC
Kilometro 5 1/2 Carretera a Santa Tecla, colonia y calle Las Mercedes, Edificios MARN,, San Salvador, El Salvador
Phone +(503) 2132-9557
aerazo@marn.gob.sv
acanas@marn.gob.sv