|Pilot Name||Collaboration with the Solas Sustainable Energy Fund (SSEF)|
|Client Type||Financial Services|
Solas Capital is a financial services company based in Switzerland but operating throughout Europe, one of its main activities is to manage the Solas Sustainable Energy Fund (SSEF).
The SSEF has been created under the condition of only funding projects that strictly comply with the sustainability metrics promoted by the European Commission. For this reason, it has received 30M EUR from the EIB as a cornerstone investment. This investment is backed by the European Fund for Strategic Investments (EFSI), the main pillar of the Investment Plan for Europe. This institutional investment is provided.
The SSEF also participate in the Private Financing for Energy Efficiency (PF4EE), which is a joint initiative of the EIB and the European Commission to facilitate investment in energy efficiency, PF4EE support is structured around two pillars:
- The Risk Sharing Facility mitigates partner banks’ credit risk when financing EE projects. The risk protection covers 80% of losses from individual loans, up to a maximum agreed amount.
- The Expert Support Facility provides consultancy services to improve bank’s knowledge of the energy efficiency market and support the financing of EE investments.
These guarantee schemes, although they force the fund to invest in underdeveloped segments or highly innovative projects, greatly reduces the perceived risks associated with these investments.
The analysis of the SSEF as a pilot application focused on several points:
First, it was examined whether the financial products offered by the fund can be considered refinancing and depending on what factors.
Next, the impact of the European guarantee schemes that the fund enjoys is studied, and how this impacts on its approach to financing ESCOs.
Another of the contents studied consists of reviewing the contract model for the long-term financing of ESCOs that was developed by Creara for the SSEF.
- SSEF is offering a financial product in the Spanish ESCO market that in many cases can be considered refinancing and is proving to be very attractive for ESCOs
- The Spanish ESCO sector has shown itself to be very receptive to this financial product. The main reasons are its flexibility and its specific focus on the energy services sector, unlike commercial banks and other traditional financial partners
The differences between the financial solutions offered by a fund backed by public guarantees and those offered by traditional FIs show the importance of public guarantee in helping to bridge the gap between ESCOs and FIs
The importance of the facilitation services provided lies in the low penetration of refinancing in this sector, where a well-placed expert partner can bring a lot of value
For more information, please contact:
Creara Energy Experts