|Institutionalization of a Loan Guarantee Fund
|Public Body/ Bank
A public body and bank whose main role is to provide loans and to facilitate financing (e.g. guarantee funds, technical assistance, subsidies etc.) for the private sector in Greece.
The public body intends to set up a Loan Guarantee Fund which would provide 80% of the guarantees requested by private banks to private enterprises wishing to upgrade the energy performance of their installations by the implementation of both energy efficiency measures and renewable energy sources.
Technical Assistance was provided so that the beneficiaries of the loan guarantee mechanism could also be extended towards ESCOs. Information was provided concerning the description of the ESCO mechanism and the obstacles that are obstructing its development (i.e. primarily, the difficulty in finding sources of financing for the implementation of the projects and, secondarily, the difficulty in refinancing the projects.)
The announcement of the Fund has been significantly delayed and has still to be launched. Unfortunately, despite the keen initial interest of the operatives of the Public Body and requests for information, the process seems to have stagnated.
The provision of loan guarantees could provide a significant positive impact to the Energy Services Market and re-financing as it would provide the smaller ESCOs with access to financing for the implementation of their projects. However, this only solves the problem of the guarantees required for the financing of a project, not the guarantees of the future payments required for the sale of receivable. A payment guarantee mechanism would also have to be institutionalized for the private sector in order to facilitate the market.
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