The SEF Opportunity

Global Lessons for Sustainable Energy Finance in Asia

Miles Stump SEF Product Specialist, Asia and Pacific

The EE Finance Opportunity (and Challenge)

Annual investments needed to capture energy productivity opportunity to 2020 ($ bn)

Source: McKinsey Global Institute 2008

Think of $97 billion as 97,000 investment decisions

Barriers to Energy Efficiency Investments

Perceived Barriers
Financing Performance risk Long paybacks

Real Needs
Strategic focus Understanding the opportunity Comprehensive solutions

Benefits to Financial Institutions

Tap huge new market opportunity Enhance client relationships

Improve borrowers risk profile

Increase yield of existing portfolio

Success Factors in Building SEF Business

Top-level bank buy-in Mainstream as a product Start with existing customer base Target client decision makers Effective technical partnerships

SEF Advisory Offering

Enabling Market Financial
level FI

Financial Institutions
Develop strategy/product
Train/guide loan officers Support marketing

Institutions Advisory

Sustainable Energy Market

Build partnerships w/FIs

Train auditors/ESCO

Players Environment

Enabling Environment
Identify policies to support SE investments

IFC SEF Scale-Up

Pilot 97 Central Europe/Baltics
6% 15% 15%

2005: Russia and China 20 local advisory programs

IFC loans, risk share facilities

CEE

64%

China Russia

Over $1 bn of financing for SE

Virtually zero default rate Mostly SMEs, except China RE: biomass waste, small hydro

Philippines

IFC Sustainable Energy Finance Reach

Continuing to Innovate in Asia

Microfinance ESCO financing SMEs in China Energy-water nexus Green buildings:
Building retrofits Retail home EE Green buildings Green mortgages

Contact Information

Miles Stump
Product Specialist, Sustainable Energy Finance East Asia and Pacific mstump@ifc.org

10