Financial sector news

UNDP and the Entrepreneurship Development Fund present ESCO fund to support sustainable development and energy efficiency

The United Nations Development Programme (UNDP) in cooperation with the Enterprise Development Fund (EDF) presented a new financial mechanism to facilitate access to bank financing for ESCO companies during the event ‘ESCO Fund: Energy Efficiency for Sustainable Development", which took place on 5 June 2024 in Kyiv. This was  reportedby  the UNDP press service

The new ESCO Fund mechanism from UNDP and the EDF will promote the development of the ESCO market in Ukraine through the use of banking instruments such as partial compensation of interest rates, loan principal, and additional guarantees. The facility is expected to finance 10 to 15 pilot projects in communities.

Andriy Gapon, Chairman of the Board of the Entrepreneurship Development Fund, added: ‘In these extremely difficult times for Ukraine, ESCO programmes are definitely a priority for every Ukrainian, so the pilot project with UNDP is a powerful impetus for the further development of insulation not only in public buildings, but also in residential ones.’

Representatives of domestic banks shared their experience in lending to ESCOs during the event, describing the existing barriers and challenges to increasing lending.

The event, organised with the support of the GEF/UNDP project ‘Removing Barriers to Energy Efficiency Investment in Public Buildings in Small and Medium-Sized Cities in Ukraine through the ESCO Mechanism’, became an important platform for sharing experiences, presenting new financial mechanisms and practical cases, contributing to the development of energy efficiency in Ukraine.