EBRD helps Ecoprod generate power from biogas
In the News | Jul 29 2013

EBRD finances Ecoprod with a 15-year loan of €1.1 million from the Clean Technology Fund to develop, construct and operate a 1.5MW biogas plant, which will produce 5.8 million cubic metres of biogas a year to be used for the generation of 9,900 MW of electricity.

Mexico Aims to Cut Emissions, Boost Afforable Housing Via Eco House Program
In the News | Jul 23 2013

The Mexican government expects the Eco House program will reduce housing sector GHG emissions by at least 20% come the end of the decade. Up to $150 million in loans has been raised in support of the program, $50 million of which is coming from the $5.2 billion Clean Technology Fund.

South Africa Adds Renewables into Coal-Heavy Energy Mix
In the News | Jul 17 2013
Giant wind turbines dot the landscape at the Darling Wind Farm, a national demonstration project near Cape Town.

By Jocelyn Newmarch originally published July 17, 2013 on Thomson Reuters Foundation. Photo: Mike Hutchings/Reuters

 

JOHANNESBURG (Thomson Reuters Foundation) - South Africans have traditionally relied upon their plentiful coal reserves to supply over 90 percent of their electricity needs. Only in the past decade has national energy policy taken note of abundant wind and solar resources. Economic growth in the past two decades has outstripped electricity capacity, and now the country needs to catch up.

As a result, Eskom, South Africa’s national electricity provider, is investing for the first time in utility-scale renewable energy, even as it also goes ahead with new coal-fired plants. The Renewables Support Programme, worth $1.3 billion, will see Eskom develop the first commercial-scale wind farm in the country and one of the world’s largest concentrating solar power (CSP) plants. Each of these two projects will add 100MW to the grid.

Financing for the programme has been obtained from the Clean Technology Fund (part of the Climate Investment Funds), the International Bank for Reconstruction and Development, and the African Development Bank.

“The programme is strongly linked to the government’s development agenda,” explained Mafalda Duarte, the African Development Bank's chief climate change specialist. The projects were approved as the “best approach” to meeting South Africa’s goal of shifting the balance of its energy mix to 42 percent clean energy while reducing its carbon emissions.

“Renewable energy will contribute to improved generation capacity and make electricity generally more reliable and resistant to fossil-price fluctuations,” she said. Because components can be sourced locally, the projects would also contribute to domestic industrial development and employment – both national priorities in a country with an official unemployment rate of 25 percent and widespread poverty.  

SOLAR POTENTIAL

According to the Clean Technology Fund (CTF) investment plan for South Africa, prepared in 2009, concentrating solar power plants have vast potential to be scaled up around the region. “In South Africa alone, Eskom estimates 40 gigawatts of commercially viable CSP in the Northern and Western Cape provinces. Replication in Namibia and Botswana could double or treble this potential,” the authors say.

In addition, solar plants could help to stabilise emissions, in line with President Jacob Zuma’s pledge to reduce growth in greenhouse gas emissions by 34 percent by 2020 and 42 percent by 2025. South Africa, despite its status as a developing country, is the 11th largest carbon emitter in the world.

“Eskom aspires to reduce its relative emissions of carbon dioxide by diversifying its energy mix in the years leading up to 2025. After this, it plans to reduce absolute emissions of carbon dioxide,” Eskom’s media desk said in response to questions.

Construction has already started on the 100 megawatt Sere wind farm, in the Western Cape, which will be fully commissioned by December 2014. It is expected to save approximately 230 000 tons of carbon emissions per year.

Eskom did not say when work would begin on the 100 MW concentrating thermal power plant, in the Northern Cape. However, the plant is due to be commissioned in 2017, and would save 450 000 tons of carbon emissions per year.

In addition, the utility will buy over 4,700 MW of renewable energy from independent power producers.

CHEAPER POWER?

Thanks to the soft loan financing structure, Eskom has been able to lower the capital cost of renewables, said Saliem Fakir, head of WWF South Africa’s Living Planet Unit. The money allowed Eskom to develop renewable energy at a cheaper rate than commercial producers, something that should ultimately result in benefits to consumers.

 Now, “the question is whether Eskom is willing to take on a larger bulk of the renewables and bring the benefits to South African consumers. If they can find ways to lower their cost of generating electricity from renewables, it can result in a lower impact on electricity tariffs,” Fakir said.

In the long term, renewable power could help South Africa save on transmission losses, lowering the cost of transmitting electricity, and create more flexibility in the national grid. “Those costs are often not taken account of because they are future costs to the economy,” he said.

 

For more information, please contact:

Steven Shalita, CIF Communications

sshalita@worldbank.org

Mexico Aims to Cut Home Energy Use with Green Loan Plan
In the News | Jun 27 2013
Workers build energy-efficient homes in the Hidalgo state capital of Pachuca. Thomson Reuters Foundation/Monica Healy

By Talli Nauman, originally published June 27, 2013 on Thomson Reuters Foundation

MEXICO CITY (Thomson Reuters Foundation) – Since the 1980s, the Mexican government has subsidised massive tract-housing projects around the country, filling them with hundreds of thousands of concrete-block, brick and mortar structures that have no insulation or other comfort control features.

This response to intense pressure for affordable urban housing is to blame for widespread urban sprawl in Mexico over the last 30 years – and increases in climate-changing emissions, experts say. Homes now use 16 percent of the country’s energy and account for 3 percent of direct greenhouse gas emissions, as well as a variety of indirect ones, according to the country’s Social Development Ministry.

That rising urban carbon footprint is one reason the country’s climate change policymakers see cutting residential emissions as essential for reaching Mexico’s 2050 target to cut its greenhouse gas emissions in half from 2002 levels.

To accomplish the needed cut, they have turned to a so-called Eco House programme, which Gisela Campillo Bermudo,  leader of the Inter-American Development Bank’s infrastructure and environment team, says is new in Latin America.

MORE COMFORT, LESS ENERGY

The construction loan program offers buyers of newly built homes increased comfort and energy cost savings – through features such as roof insulation and solar water heating - at the same price they’d pay for conventional shelter. It aims to reduce the housing sector’s greenhouse-gas emissions at least 20 percent by the end of this decade.

The object is “to prompt climate-friendly design, adjusting it to the characteristics of each locale, and develop new construction systems of higher quality and efficiency,” says Mónica Healy Hegewisch, a member of Campillo’s team.

The Eco House program is being financed with up to $150 million in loans including approximately $50 million from the multi donor  Clean Technology Fund (CTF), which aims to help middle-income countries scale up low-carbon  technology. The CTF is one of two Climate Investment Funds  that support developing countries to pilot low-emissions and climate-resilient development projects through multilateral development banks.

Mexico is the first country in the hemisphere to access the CTF via a Nationally Appropriate Mitigation Action for Sustainable Housing - essentially the country’s own plan to reduce carbon emissions from housing.  Mexico’s decision to focus on reducing housing emissions reflects findings that investments in domestic energy efficiency are more cost-effective than other alternatives for reducing greenhouse gas.

The financing deal creates a revolving fund, which can create $350 million in generous cut-rate loans to builders over the next seven years. It makes Mexico a leader in testing new climate-linked lending models now being used by the World Bank and its international partners.

The money is expected to filter down to contractors in equal shares from the German Economic Development Bank KfW, the Inter-American Development Bank, and the Mexican Development Bank’s Federal Mortgage Society.

All borrowers have to do, to start, is make sure they fit new homes they build with previously overlooked items such as roof and wall insulation, double-pane windows, solar water heating and state-of-the-art refrigerators.

 All the buyers have to do is select the home sites they want, draw up the paperwork, and move in.

ADVANCING THE ‘GREEN MORTGAGE’

The program goes a step further than what Campillo calls the “well-known and successful” Green Mortgage program, in which the government helped some 900,000 people take out mortgages to buy energy-efficient homes from 2007 to 2012, through the National Housing Fund for private sector employees.

The Green Mortgage program led to reductions of 60 percent in water consumption in the new homes, compared to traditional homes, as well as reductions of 50 percent in gas, and 40 percent in electricity. Greenhouse gas emissions fell 1.2 tons per dwelling per year.

The financial incentive earned a UN World Habitat award and an Inter-American Development Bank Beyond Banking prize for encouraging developers to outfit homes with energy-efficient materials and appliances by offering government subsidised loans to the purchasers.

In the EcoHouse program, green mortgages will be extended beyond National Housing Fund recipients to 1,700 other home buyers  financed through the State Workers Housing Fund for public employees as well as to breadwinners not eligible for either fund.

Some 27,600 Eco Houses are slated for completion before 2020. Since construction began in December, three developers have finished 84 Eco Houses in the south central Mexican state of Hidalgo.

The finished houses, in the Hidalgo state capital of Pachuca, are ready to occupy as soon as the buyers make plans to move, according to Tobias Contreras, a spokesman for VINTE, one of the three developers working on Phase I of the programme.

VINTE and two other developers were chosen to participate in the programme on the basis of capacity, experience and inventiveness in energy efficiency measures. The three have started work on 2,500 new units and expect to complete 9,500 in Phase 1.

So far lenders have extended them $900,000 in credit. When the contractors repay the loans, the money goes back into the programme to finance building more Eco Houses in Phase II, according to the scheme.

GREEN MATERIALS?

Eco House developers are free to select the materials they prefer to meet efficiency guidelines. At the outset of the programme, the developers are relying on concrete structural components and polystyrene insulation, according to Adrian Araujo, a spokesman for the National Mortgage Society.

Polystyrene is a petroleum product that exudes hydro chlorofluorocarbons, scientifically linked to ozone depletion and global warming. The material takes hundreds of years to decompose.

A 5-hectare forest plot would be necessary to offset the carbon dioxide emissions of each typical cement block house in Mexico, according to international award-winning Mexican architect and green builder Alejandra Caballero.

But the programme is expected over time to create growing demand for climate-friendly insulation and other building materials, administrators said.  Improving manufacturing of green construction products is one of the stated Eco House programme goals.

Backers of the programme acknowledge that home builders will require technical assistance to design and build next-generation homes.  The programme earmarks $660,000 from the Clean Technology Fund for external advisers and consultants in the design and certification processes.

 ‘PASSIVE’ HOUSES NEXT

One important step forward, within the Eco House programme, is a newly launched system of grants of $7,000 to $17,000, from the European Commission’s Latin American Investment Facility, to help build 800 special “passive” houses which need no active heating or cooling systems, Healy said.

Such houses are expected to eventually account for the majority of the 1-million-ton reduction in greenhouse gas emissions sought through the Eco House programme.

Green building is alive and well in Mexico. Its techniques include do-it-yourself strategic landscaping, water catchment, and construction with materials such as local mud, straw, and thatch that provide inexpensive, low-carbon and healthy alternatives to tract housing.

Healy said some methods of “bio construction”, such as adobe building, are out of the running for use in Eco House homes because they are too “artisanal” for the large scale of the project. However at least one builder is seeking certification to use compressed earth blocks, breaking the trail for other green builders to take advantage of the financing opportunities.

Part of the Eco Home foreign investment will fund monitoring, evaluation and efforts to raise awareness among both home builders and buyers about the importance of energy conservation in curbing global warming.

The most exciting aspect of the monitoring is an in-home device that shows residents their energy use in real time, said VINTE’s Contreras.

Technicians at VINTE invented and patented the meter, which Contreras hopes will raise awareness of water, gas, electricity and other consumption costs and ultimately contribute to building demand for environmentally friendly features in homes.

 “You can’t save what you can’t measure,” he notes.

 

For more information, please contact:

Steven Shalita, CIF Communications

sshalita@worldbank.org

The right renewables? Location, location, location!
In the News | Jun 26 2013

At the Birdlife World Congress (June 19-22), the CIF joined high-level panelists to explore strategies and experiences in working with renewable energy developments and provide insight into robust and strategic impact assessment, safeguards, policy development, and the importance of environmental recovery in addressing climate change.

The right renewables? Location, location, location!
In the News | Jun 26 2013

At the Birdlife World Congress (June 19-22), the CIF joined high-level panelists to explore strategies and experiences in working with renewable energy developments and provide insight into robust and strategic impact assessment, safeguards, policy development, and the importance of environmental recovery in addressing climate change.

Eye on the Sky: Examining Wind Power, Birds, and Bats
Feature Story | Jun 14 2013
Wind turbines and transmission lines can displace bird and bat populations and disrupt breeding and feeding.

 

Wind power is renewable, sustainable, low-carbon, and gaining momentum worldwide: about 10% annual market growth and 19% cumulative capacity growth according to the Global Wind Energy Council (2012). But just because wind-generated energy is considered “green” does not mean it is harmless to the environment and biodiversity. Of particular concern is the threat that wind power can pose to birds and bats in flight and on the ground.  
 
To understand better the potential impacts of wind power on birds and bats and how to minimize risks, the Climate Investment Funds (CIF) have been bringing together representatives from CIF pilot countries governments, civil society, private sector, multilateral development banks (MDB), and other partners in a series of roundtable discussions and learning workshops to share experiences and innovations. The CIF has a mandate to promote learning and exchange knowledge on the challenges of effectively delivering climate action, not to mention an over $700 million stake in supporting wind power expansion in middle income and developing countries like Ethiopia, Egypt, Mexico, Morocco,South Africa, Turkey, and Ukraine. Focusing on Egypt, South Africa, and Turkey as case studies, this CIF Learning effort is revealing a growing list of best practices and resources, as well as these key findings:
 
Potential impacts are multiple and cause for concern.
Wind turbines, transmission lines, and associated infrastructure can displace bird and bat populations and disrupt breeding, feeding, and migration patterns. Birds can suffer fatal midair collisions with wind turbines and transmission lines, as well as electrocutions, while bats are prone to barotrauma brought on by a drop in air pressure near turning turbine blades. The introduction of green spaces, water, lighting, and refuse near wind farm structures can attract birds and bats, putting them at greater risk. These threats are compounded when the species in question are endangered or rare. 
 
“At this point in time, the impacts are considerably less than, for example, those of agriculture, forestry, and deforestation, but as wind energy development is scaled up, covering a much larger land area, and as some of these developments are being advanced in very sensitive regions of the world, this is certainly an issue we need to give due consideration,” stated Richard Grimmet of BirdLife International at the CIF Master Class on Managing the Impact of Wind Power Development on Birds and Bats in Istanbul, Turkey on November 1, 2012.  
 
Prevention is the best cure. 
Upholding the mitigation hierarchy—avoid, reduce, mitigate, offset—CIF stakeholders agree the best way to protect biodiversity is to avoid building wind farms in areas critical to bird and bat populations. Identifying these areas can be achieved through avian sensitivity mapping and strategic environmental impact assessments in the early planning stages of development. However, assessment standards and regulations vary by country as does capacity to collect and analyze data. Study on bats is a noted deficiency in many CIF countries.  
 
Egypt (pdf), which aims to satisfy 20% of its electricity needs through renewable energy by 2020 (including 12% from wind energy or about 7,200 MW of installed capacity), is also home to 34 Important Bird Areas. Bird migration over the wind-rich Gulf of Suez is a major concern to wind power development. Ornithological impact assessments (2006, 2009, 2011) have identified critical flyways and migration patterns, allowing developers to pinpoint low-impact sites for wind power projects and prompting the relocation (and subsequent delay) of a 200 MW wind farm being financed in part by $50 million from the Clean Technology Fund (CTF). 
 
Who bears and shares the responsibility and cost of mitigation is not definitive. 
Proven mitigation measures such as temporary shut-down of turbines, higher cut-in speeds, radar detection and other post-construction monitoring systems can greatly reduce impacts to avifauna. However, monitoring is resource-intensive and idled turbines mean lost generation capacity and revenue. Disparity in regulations and standards, as well as cooperation, makes this a gray area. 
Particularly for shut downs, clear command and control arrangements and effective coordination between operators are required. “It is just not going to work if one operator shuts down and another doesn’t,” warned Grimmet.  
 
Private utility Zorlu Energy (video), which owns and operates a 135 MW wind farm in Osmaniye, has taken it upon itself to become the first operator in Turkey to install a bird monitoring radar system that automatically shuts down specific turbines as bird movement is detected. The system’s constant data collection is also building a database of ornithological information previously unavailable in Turkey. The radar represents a half-million dollar investment in technology and training, and the periodic shut-downs are accepted as necessary financial loss. 
 
“We have tried to be a case study and example to other power plants,” said Erdinc Cetin, Senior Deputy Manager of Project Finance for Zorlu Energy.  
 
Greater capacity and cooperation are needed. 
Governments, project developers, and other stakeholders need to be equipped with more knowledge and experience to manage biodiversity issues. Investments in skills training, learning workshops, data sharing, and stakeholder engagement are necessary at the national and regional level. 
 
Recounting the CIF roundtable discussion in Ankara, Turkey on September 6, 2012, Jose Tavares of the Royal Society for the Protection of Birds, Turkey stressed, “The role the CIF has played very well today is sitting all the stakeholders around the same table and facilitating a discussion. It was great to have ministries, industry, banks, and the environmental sector discussing impacts on birds and biodiversity.” 
 
Participants at the CIF Master Class suggested an international community of practice could build off of CIF learning efforts by compiling and disseminating documentation on best practices, connecting experienced countries and operators with newcomers, and encouraging collaboration amongst stakeholders to leverage comparative advantages and create synergies.
 
Although new to wind energy, South Africa’s public utility Eskom (pdf) is drawing on its 16-year strategic partnership with Endangered Wildlife Trust (EWT) (pdf) to ensure South Africa’s wind industry grows in an environmentally responsible way using the same methodologies and approaches Eskom and EWT have  developed to address environmental and biodiversity impacts of the Eskom’s 400,000 km transmission network. 
 
“This is a unique partnership between a conservationist NGO and industry. It was built on the spirit of mutual trust and cooperation, integrating engineering and ornithological skills to develop and implement solutions,” explained Megan Diamond, WEP Programme Manager for the EWT.
 
According to Rudi Kruger, Corporate Specialist for Eskom, “The scope and variety of expertise on electricity and wildlife interactions currently residing within the program is arguably unique in the world. Nowhere else has a comparable body of knowledge been built up on such a wide range of interactions in this field.”
 
The Eskom/EWT relationship has helped integrate biodiversity considerations into all phases of the Eskom project life-cycle, including detailed biodiversity assessments and avifaunal studies augmented by bird sensitivity maps and input from ornithological experts and site specific studies for all Eskom wind energy projects. This research has guided siting and route selection, including that of associated infrastructure. Moreover, Eskom and the South African Wind Energy Association (SAWEA) have also endorsed best practices guidelines on avian monitoring and impact mitigation developed by the EWT. 
 
Full reports and presentations, including video, from CIF Learning events on the impacts of wind power on birds and bats are available.
 
For more information, please contact:
 
CIF Administrative Unit
Zhihong Zhang
CTF Program Coordinator
Turkish appliance manufacturer, Sinbo, uses 12% less energy thanks to an EBRD-financed upgrade
In the News | Jun 13 2013

Sinbo, a leading Turkish manufacturer, received $9 million in financing to reduce its energy consumption from the EBRD’s Turkish Sustainable Energy Financing Facility (TurSEFF), which benefits from $50 million in concessional and grant co-financing through the Clean Technology Fund.

Assessment of the Impact of the CTF on the Renewable Energy and Energy Efficiency Market in Turkey
Press Release | Jun 07 2013

Photo: World Bank

WASHINGTON, D.C., June 7, 2013 — The Clean Technology Fund (CTF), jointly with the World Bank, International Finance Corporation (IFC), and European Bank for Reconstruction and Development (EBRD), have launched the Assessment Report of the Clean Technology Fund in Renewable Energy and Energy Efficiency Market in Turkey.

The report analyzes the impact that the CTF has had on the renewable energy and energy efficiency market in Turkey, verifies the methodology used and the data on emission reductions reported by beneficiary banks and other recipients of CTF funds, and reviews the monitoring and evaluation system of various government institutions. It validates the emission reductions achieved through the CTF, which are estimated to be over 2 million tons per year for all of the projects financed by the CTF and international financial institutions (IFIs). The report also makes recommendations on how to strengthen further the monitoring and evaluation system for renewable energy and energy efficiency investments in Turkey. 

As electricity demand has increased rapidly over recent years of high economic growth, Turkey faces the twin challenge of ensuring energy security and containing greenhouse gas emissions to mitigate climate change.  Low-interest CTF loans have helped to increase privately operated renewable energy production and private sector energy efficiency, thereby reducing greenhouse gas emissions and energy cost, and ultimately contributing to the transformation of the Turkish energy sector.

To date, the CTF has provided $200 million in soft loans and technical assistance to promote private sector investment in energy efficiency and renewable energy projects in Turkey. Backed by this commitment, EBRD provided and mobilized $285 million and IFC provided $255 million for financing renewable energy and energy efficiency projects through financial institutions. The World Bank’s contribution in support of related private sector projects has reached $1 billion. The total volume contributed and mobilized by the multilateral development banks (MDBs) topped $1.535 billion by the end of 2012.

Turkey was the first country to have benefitted from CTF funds and Turkish Minister of Energy and Natural Resources Taner Yildiz stated: “Partnering with the multilateral development banks through the CTF has helped Turkey to scale up investments in energy efficiency, renewable energy, and smart grids by empowering its own national private and banking sector. The fact that Turkey has been a first mover in achieving results on the ground has inspired investors and emboldened us to be even more ambitious not only in the scale of investments we seek to achieve but also in the types of renewable technologies we are considering.”

Country Director of the World Bank in Turkey, Martin Raiser stated: “The CTF was set up to support transformational investments. Through its CTF program, Turkey has launched the transformation of its energy sector towards greater reliance on renewable energy sources, and has shown that this is not just good for the climate but can be good for business, too. Much remains to be done, particularly to boost energy efficiency and decouple growth from emissions. The international financial institutions stand ready to help Turkey take further climate action.”

Dimitris Tsitsiragos, IFC Vice President Europe, Central Asia, Middle East and North Africa said: “Climate change is one of the biggest issues in development today. While public policy is key to address these issues, private sector will play a significant role to meet the challenge and to create opportunities through new technologies and innovation for energy efficiency, renewable energy and climate friendly finance projects. Supporting climate change business continues to be a key element of IFC’s strategy in Turkey.”

Mike Davey, EBRD Director for Turkey said:“Energy efficiency is and will be for the long term a key factor for the competitiveness of Turkish businesses as well as in promoting macro-economic stability. By maintaining and building its focus on sustainable development, Turkey can further build on its position as a regional leader in investment and innovation. The EBRD will continue to support Turkey and its businesses alongside that road through its financing of investments in sustainable energy and resource efficiency, from renewables to energy recovery to waste recycling. To date, more than 40% of EBRD’s Euro 3 billion portfolio in Turkey has been provided for those purposes”.

The CTF, one of the four funding windows of the $7.6 billion Climate Investment Funds (CIF),provides middle income countries with resources to explore options to scale up the demonstration, deployment, and transfer of low-carbon, clean technologies in transport, energy efficiency, and renewable energy such as wind, solar, and geothermal power.  Each country tailors its CTF investment plan to be integrated into national development objectives and to serve as a framework for activities across institutions, stakeholders, and sectors. The governments of Australia, Canada, France, Germany, Japan, Spain, Sweden, United Kingdom, and United States have pledged $5.2 billion to this multilateral fund administered through the five MDBs: the African Development Bank (AfDB), Asian Development Bank (ADB), Inter-American Development Bank (IDB), EBRD, and the World Bank Group, including IFC. 

For more information, please contact:

Steven Kenneth Shalita 

Senior Communications Officer 

Climate Investment Funds

Email: sshalita@worldbank.org 

EBRD to Finance Largest Biogas Grid-Connected Project in Ukraine
Press Release | Jun 06 2013

The EBRD is organizing a financing facility of up to €4.2 million for a 1.5MW biogas plant at the privately owned agribusiness company Ecoprod in eastern Ukraine. This project is part of the Ukraine Sustainable Energy Lending Facility (USELF), an investment facility of €70 million (€50 million from the EBRD and €20 million from the CTF) designed to provide finance to private local enterprises wishing to invest in renewable energy projects in Ukraine.

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