Financing Clean Energy Project

Barsha Shrestha

General Manager

Clean Energy Development Bank Ltd.

Outline

• Brief Introduction of CEDB

• Exposure in Clean Energy Project

• Resource Mobilization

• Products Available for Finance Clean Energy Project

• How to apply?

• National Level Development Bank established in a joint venture with FMO - Dutch Entrepreneurial Development Bank in 2006,

• Establish itself as a leader in clean energy and energy efficiency financing,

• Provides technical know-how, project financing, pre-investment activities, investment and corporate advisory services to clean energy project,

• Offers a wide range of corporate and retail banking services with a unique customer oriented approach,

• Only financial institution in Nepal that has the in house capacity to do due-diligence of clean energy project

Introduction of CEDB

People

In-house technical and financial experts

Full-fledged energy division

Dedicated division for RET and micro financing

Experienced bankers

Partners

AEPC

KfW

FMO

Triodos

IFC

GIZ

Winrock

USAID

CEDB's Strength

• Grid Connected Hydro Project Financing: – Pioneered Limited Recourse Project Financing in hydropower project, – Established separate Energy Division within the Bank to do due diligence

of clean energy project, – Completed financial closure of 10 hydro projects with capacity ranging

from 600kW to 10MW,

• Off-grid Hydro Project Financing: – Fund manager of Micro Hydro Debt Fund, a dedicated fund to finance

micro hydro project with capacity ranging from 10kW to 100kW, – Completed financial closure of 9 Micro Hydro projects,

• Solar Energy Financing: – Pioneered solar home system financing in urban areas, – Pioneered solar home system financing in rural areas through

microfinance,

• Biogas Financing: – Pioneered vendor financing model to finance household biogas plant, – More than 500 household biogas plants are financed under vendor

financing model,

Exposure in Clean Energy (1)

• Electric Vehicle Financing: – Financing electric vehicle for commercial and private uses, – Promoting 'driver owner concept' in commercial electric vehicle

financing, – Already financed more than 300 electric vehicles plying in

Kathmandu valley

• Energy Efficiency Financing: – Financed 1 three star hotel for replacing diesel boiler with solar

water heater, – Completed financial closures of 1 resort to implement energy

efficiency measures,

• Financing Energy Contractors/Energy Service Companies: – Provided financial supports to:

• 4 hydropower contractors, • 8 micro hydro installer companies, • 28 solar companies, • 6 biogas construction companies

Exposure in Clean Energy (2)

• CEDB mobilizes local as well as international resources to finance clean energy project: – Capital and Reserves

– Saving and Deposit

– FMO Long-term Debt

– CEDB Hydro Fund

– Micro Hydro Debt Fund

– Improved Water Mill Credit Fund

– Refinancing Facility from Central Bank

Resource Mobilization

• Project Financing: – Provide limited recourse project financing to grid connected clean

energy project, – Look primarily to the cash-flow/ revenue stream generated by the

project for repayment, – Take charge over asset created in the project as the security, – Project assets, project-related contracts, and project cash flows are

separated to a large degree from the sponsors,

• Sustainable Energy Financing: – CEDB in partnership with IFC has launched Sustainable Energy Finance

product which provides financing for the following technological solutions: • Renewable Energy: Refers to energy (heat and/or power) generation

from sources that could be regenerated (biomass residues, biogas from wastewater, poultry/piggery waste, municipal solid waste) or cannot be depleted (sun, wind, water, geothermal heat).

Products Available for Financing Clean Energy Project (1)

• Energy Efficiency: Refers to use of equipment that reduce energy usage per unit of production, or increase energy generation using the same amount of fuel.

• Cleaner Production: Refers to more efficient use of resources such as water, raw materials and labor, as well as minimizing waste and emissions of GHG and other pollutants from industrial processes.

• Micro Hydro Project Financing: – Fund manager of Micro Hydro Debt Fund, dedicated fund

provided by GIZ through AEPC for financing micro hydro project, – Financing available for 10kW to 100kW micro hydro project

promoted by AEPC under GoN subsidy policy, – Project must be owned by local community, – AEPC bears the cost of project insurance and field visit, – No additional collateral required other than project assets,

Products Available for Financing Clean Energy Project (2)

• Clean Contractors Financing: – Targeted to Clean Energy Contractors, – To part finance cash outlays involved in the various contracts directly

associated with the construction of clean energy project, – Contractor should have a valid contract agreement signed with project

developer, – Maximum loan amount is 80% of fair market value of the mortgaged

property and/or 25% of project cost

• Improved Water Mill Project Financing: – CEDB has recently been selected as a fund manager of Improved Water

Mill Credit Fund provided by ADB through AEPC, – Financing for IWM project available under cluster financing, vendor

financing and micro financing through MFIs, – Committed to promote social merchant banking approach under

proposed IWM project financing

Products Available for Financing Clean Energy Project (3)

• Sourya Urja Financing:

– Targeted to end user of solar energy system,

– Financing available up to 100% of solar energy system cost,

– Loan tenure is 5 years

• CEDB is also open to offer tailored made financing solution to any clean energy project

Products Available for Financing Clean Energy Project (4)

• Submit following documents: – Request letter for loan and/or other services

– Project feasibility report / Business plan

– Legal documents

– Other project documents (if any)

• Contact Details:

How to apply?

Grid Connected Project Financing Off Grid Project and Other Renewable Energy Financing

Mr. Birendra Rana Acting Credit Head Clean Energy Development Bank Ltd., Sitapaila Chowk, Ring Road, Kathmandu, Phone: +977 1 4671444/666 Fax: +977 1 4288831 Email: birendra.rana@cedbl.com

Mr. Dinesh Dulal Relationship Manager Clean Energy Development Bank Ltd. Sitapaila Chowk, Ring Road, Kathmandu Phone: +977 1 4671444/666 Fax: +977 1 4288831 Email: dinesh.dulal@cedbl.com

Thank You!

Let’s empower