The Green for Growth Fund (GGF) is a specialised fund, supported by the European Commission, designed to advance energy efficiency and renewable energy in neighbouring countries. It provides refinancing to financial institutions to enhance their participation in these sectors, and also invests directly into energy efficiency and renewable energy projects. This project extends the fund’s reach to Armenia, Azerbaijan, Georgia, Moldova, and Ukraine.
Why is the fund needed?
Efforts to upgrade and “green” households, businesses, and public entities in the Eastern Partnership region require significant capital investment and technical expertise, which national and regional governments often lack. The Green for Growth Fund is a long-term financial instrument to support energy efficiency and renewable energy technologies and investments in the region. It is partly funded by the Neighbourhood Investment Facility (NIF), created in 2008 as a mechanism to mobilise additional funding to finance infrastructure projects in sectors such as transport, energy and the environment.
Actions in brief
How does the fund help?
By broadening the financing base of energy efficiency and renewable energy investments, the GGF enables capital-intensive projects to get off the ground. It also makes investments more effective by harmonising and coordinating donor initiatives. The GGF Technical Assistance Facility (TAF) also plays a key role by providing targeted assistance to financial institutions and project developers, in conjunction with GGF funding. An example of a GGF-supported project is a new wind power facility outside Gori, Georgia. In Moldova too, small loans have helped households and SMEs improve their energy efficiency.
Over a dozen institutions support the GGF, with so-called first-loss funding provided by the European Commission, administered by the European Investment Fund, along with the German government. To date, the GGF has financed over 24 000 individual energy and CO2 savings projects totalling €510 million and saving 430,000 tCO2 per year. From 2018 onwards, around 50% of loan disbursements will go towards building energy efficiency improvements.
Who stands to benefit?
The Green for Growth Fund provides investments in the energy efficiency and renewable energy sectors both indirectly, through financial institutions, and directly to entities such as renewable energy and energy service companies.
It enables sustainable projects to be put into action, benefiting citizens, businesses and the environment in the long term. Agricultural beneficiaries for example can invest in water storage and irrigation technologies. Households and retailers can apply for funding to install new boilers and insulate their properties, while businesses and municipalities can carry out major energy efficiency investments.Print pdf