Financing Energy Efficiency in Romania

The UNDP/GEF Energy Efficiency Financing Team
Between 2003 and 2006, the United Nations Development Programme and the Global Environment Facility (UNDP/GEF) ran a project entitled "Capacity-building for Greenhouse Gas Emissions Reduction through Energy Efficiency in Romania"

A Team of specialists in energy efficiency policy, engineering, banking, finance, communications and administration, supported by around 20 local consulting companies, carried out a mission to:

• Persuade companies and municipalities to lower greenhouse gas emissions by investing in energy efficiency;
• Build local capacity for this type of greenhouse-friendly investment to continue in the future; and
• Help leverage 20 real investments with a combined value of 12.5 million USD.

The Project Team applied a simple principle - that a small investment by UNDP/GEF, in the form of Technical Assistance (TA) or a Direct Contribution (DC) of equipment, should help leverage a very much larger investment in energy efficiency by a third party. This approach worked well. By the time the project closed in 2006:

• 68 Romanian municipalities, pubic utilities and private companies had received substantive support from UNDP/GEF; and
• 34 investments with a combined value of almost 70 million USD were in progress or complete, with several more expected to follow.

The Report "Energy Efficiency Financing in Romania - A Training and Best Practice Manual"
This report, which may be downloaded in Romanian and English languages, (PDF format), tells the story of the Project and, together with this website, passes on the experience of the UNDP/GEF Energy Efficiency Financing Team. The Manual contains:

• Tips for converting energy efficiency investment proposals into real investments;
• How to hire the right consultants to prepare the right studies... at the right cost;
• Technical and economic features of ten popular energy efficiency investments;
• Special considerations for municipal energy efficiency investors;
• Banking, finance and economics training - all you really need to know about money; and
• Case studies - with real examples of successful energy efficiency investments in Romania, in the fields of public lighting, buildings, community heating, water utilities, apartment blocks, industries, renewable energy and combined heat and power.

Stakeholders

Public sector beneficiaries included Alba Iulia, Bucharest Sector 1, Carei, Cehu Silvaniei, Comanesti, Cluj-Napoca, Gheorghieni, Iasi, Madaras Bihor, Miercurea Ciuc, Medgidia, Orastie, Oradea, Panaci, Salonta, Satu Mare, Sighisoara, Sinmartin, Solesti, Targoviste, Targu Jiu, Tarnaveni, Topoloveni, Tulcea, Valea lui Mihai, Victoria (Brasov), Vlahita and Zalau.

Private sector beneficiaries included SC Ambro SA Suceava, SC Ardealu SA Carei, SC Electroaparataj SA Bucuresti, SC Colterm SA Timisoara, SC Foradex SA, SC Goscom SA Miercurea Ciuc, SC Iridex SA Group, SC Expur SA, SC Farmec SA, SC Isovolta SA, SC Metalica SA, SC Metalul Mesa SA, SC Nord Simex SRL, SC Plastor SA, S.C. Rominservices Therm S.A., SC Rulmenti SA Barlad, SC Samus Mex SA, SC Sicomed SA, SC Smav SRL, SC Timken SA, SC Transgex SA, SC Sortilemn SA, SC Ulerom SA, SC Viromet SA Victoria,SC Vrancart SA Adjud and SC Zoppas SA.

Specialist consultants, who were selected using open, competitive and transparent selection procedures to perform technical/economic studies to support investment proposals, were Amper Proiect, ASA Holding, Asociatia pentru Politici Energetice din Romania (APER), Global Energy Services, ICPT Instalatii, Institutul de Studii si Proiectari Energetice (ISPE), Institutul National al Lemnului (INL), Interproiect, Intreprinderea de Studii si Cercetari Energetice, Marcel Dobescu, Micronix, OVM-ICCPET, CPA, Energobit, EnergoEco, Energolux, Forenerg, IPROMET, Proiect Targu Mures, Trapec, Vest-Energolux, Wayda and Wayda.

Financiers who were involved in the project included Banca Transilvania, European Bank for Reconstruction and Development (EBRD), Raiffeisen Bank, Romanian Commercial Bank (BCR), Romanian Development Bank (BRD), The Romanian Fund for Energy Efficiency (FREE), The Romanian Industrial Energy Efficiency Company and Sanpaolo IMI Bank.

The Government of Romania was represented by the Ministry of Economy and Commerce , through the Romanian Agency for Energy Conservation (ARCE). ARCE played an active role, overseeing the Project together with the country office of UNDP; participating with the UNDP/GEF team at a variety of national and international events and training courses; and participating in Evaluation Committee meetings to analyse technical offers to perform external studies, and to determine the type and value of UNDP/GEF-financed equipment to donate to public sector investment projects. A Steering Committee , with 20 members and observers from a wide range of ministries, organisations and NGOs met annually to provide guidance and advice to the project team.

The Global Environment Facility (GEF) provided around two million USD to carry out this project, through the UNDP/GEF team in Bratislava, who oversaw the project. UNDP Romania monitored the project, and participated in Evaluation Committee meetings together with ARCE and the Project Team; and UNOPS executed the Project, controlling financial expenditure and appointing a Chief Technical Adviser to set up and manage an Energy Efficiency Financing Team in Bucharest.