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EU seeks global energy fund to boost investment in poor nations

The European Commission recommended creating a €100 million global risk-capital fund to boost energy efficiency and renewable energy sources in developing nations. The commission pledged to contribute four-fifths of the sum in the next four years. „This fund can mobilize private investments,” the Brussels-based commission, the 25-nation EU's executive arm, said in a statement today. „It will contribute to bringing clean, secure and affordable energy supplies to the 1.6 billion people around the world who have no access to electricity.” The EU aims to overcome investment barriers for clean-energy projects in places such as Africa by tackling the lack of risk capital, which provides collateral for lenders. Such projects help meet the bloc's goal of fighting poverty and global air pollution. The fund will cover investments mainly below $10 million in Africa, the Caribbean, Latin America, Asia and non-EU eastern European countries, according to the commission, which said „priority will be given to deploying environmentally sound technologies with a proven technical track record.” The commission plans to put €15 million into the fund next year and another €65 million in 2008-2010. The project is called the Global Energy Efficiency and Renewable Energy Fund, or Geeref. The commission said it expects public and private funding to total €100 million and predicted this sum would mobilize extra risk capital of at least €300 million and „possibly up to €1 billion in the longer term.” (Bloomberg)