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Development Account Projects

Promoting energy efficiency investments for climate change mitigation and sustainable development

Background:

Developing countries and countries with economies in transition face serious challenges in attracting private investments in energy efficiency. There are several reasons for this as well as possible solutions. First, dedicated sources of financing for energy efficiency are lacking and local banks are generally unfamiliar with such investments. This requires the creation of opportunities for banks and commercial companies to invest in energy efficiency and renewable energy projects through the development of dedicated public-private partnership investment funds. Secondly, local experts lack adequate knowledge and experience in identifying and formulating energy efficiency investment project proposals. There is a need to develop skills in the private and public sectors at the local level to identify, formulate and implement energy efficiency and renewable energy investment projects. Thirdly, in the absence of policy and institutional support, private investors are not motivated to finance energy efficiency projects. This requires specific assistance to municipal authorities and national Governments to introduce reforms needed to support these investments.
A number of countries worldwide have expressed their interest in adopting energy efficiency measures in sectors with high carbon dioxide emission levels. For this project, each United Nations regional commission would select pilot countries that are (a) considering energy efficiency challenges as a priority of their national policies and services and (b) seeking to participate in the project (these will be countries with developing energy efficiency markets and products). A regional approach to the project will optimize resources, create synergies and enable the building of a partnership among regional and international experts. Additional resources would have to be leveraged to replicate this project in other countries, in different parts of the world. Cooperation among all United Nations regional commissions and with UN-Energy is essential. While the project includes activities on policy reforms, the main focus will be capacity-building in the development of energy efficiency investment projects.

The proposed project will be led by ECE and jointly implemented with other United Nations regional commissions and the Department of Economic and Social Affairs within the UN-Energy framework.

Objective:

Strengthen capacities of developing countries and countries with economies in transition to attract investments in energy efficiency projects in the context of climate change mitigation and sustainable development

Expected accomplishments:

  • Improved capacity of national project developers, energy experts and middle level managers in developing countries and countries with economies in transition to develop energy efficiency investment projects in private and public sectors

  • Improved regulatory and institutional framework for promotion of new financing mechanisms for energy efficiency projects

  • Increased financing for investments in energy efficiency projects, including through the innovative financing mechanisms. 

Implementation status:

A number of activities have been prepared and/or conducted:

    • ESCWA: organized a Regional Training on Technical & Economic Aspects for Developing Energy Efficiency (EE) Investment projects;
    • ECLAC: three countries were selected to undertake the national case studies - Brazil, El Salvador and Uruguay. First drafts of the case studies are in the process of being reviewed before the publication of the final versions;
    • ECA: held project inception meeting with the North Africa region national institution and implementing partner, ADERREE and other relevant organization to develop terms of reference for the country case studies; three countries were selected to undertake the national case studies - Morocco, South Africa and Ghana. A study on innovative financing mechanisms for clean energy in Africa with emphasis on energy efficiency and energy mix was produced and presented in the All African Energy Week;
    • ESCAP: preparation of two regional trainings (curriculum, content, terms of reference for training facilitator) in project development, finance and business planning to be conducted in cooperation with UNECE;  Terms of reference for national case studies have been prepared;
    • ECE: three countries were selected to undertake the national case studies – Georgia, Montenegro, and Tajikistan. Montenegro case study has been completed. Two other studies are under preparation. The workshop to discuss terms of reference and implementation of the case studies has been held. Preparation of two regional trainings (curriculum, content, terms of reference for training facilitator) in project development, finance and business planning to be conducted in cooperation with ESCAP.