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EBRD signs first energy efficiency loans in Moldova

The EBRD is providing a €7 million loan to Moldova-Agroindbank and a €6 million loan to Moldindconbank, for on-lending to local companies undertaking energy efficiency investments.

The loans are part of the EBRD’s €20 million Moldova Sustainable Energy Financing Facility (MoSEFF), launched in February 2010.

Moldova-Agroindbank is the leading bank in Moldova and Moldindconbank is the fourth largest bank in the country by assets and third by gross loans and total deposits.

The proceeds of the EBRD loans will be used to finance such investments as replacement of outdated production and heating equipment, rehabilitation and replacement of boilers, installation of meters, thermal insulation, refurbishment of heat and power distribution systems, biomass, biogas and solar energy projects among others.

The facility will enable the participating banks to provide loans worth up to €2 million to private Moldovan companies. Sub-borrowers undertaking energy efficiency investments will benefit from incentive payments granted by the European Union of up to 10%-20% of the sub-loan upon the successful completion of the works. The amount of the reimbursed grant will depend on the technology and the energy savings achieved as a result of the project. In addition, the businesses will benefit from free technical assistance in assessing energy saving potential and project implementation.

“We are pleased to expand our cooperation with Moldova-Agroindbank and Moldindconbank in such an important area as energy efficiency. Through these projects the EBRD, together with Moldova-Agroindbank and Moldindconbank, will help Moldovan companies reduce their energy consumption and improve overall efficiency”, said Francis Malige, EBRD Director for Financial Institutions, Western Balkans, Belarus, Moldova and Turkey.

“Our participation in this project is the result of a very good co-operation with the EBRD in the small and medium enterprise sector and trade facilitation program. The current efforts by our clients to save energy will be enhanced by this project which will be fully and timely implemented. We will optimize the costs and increase the competition in the market,” said  Natalia Vrabie, President of Moldova-Agroindbank.

“Our co-operation with the EBRD is a pioneering work in the energy savings field. This is very important under the current market conditions and we are determined to implement the project in best market terms for our clients”, said Svetlana Banari, President of Moldindconbank.

It is expected that projects implemented under MoSEFF will result in total energy savings of 22,000 MWh per year and an annual reduction in CO2 emissions of 6,600 tons annually, equivalent to an estimated 2.3 million of cubic meters of imported gas.

To date the EBRD has committed more than €400 million in various sectors of the Moldovan economy. The EBRD funds mobilized additional investments in excess of €330 million. (press release)