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EBRD and Compagnie Générale de Chauffe target energy efficiency in eastern Europe
To help increase energy efficiency in eastern Europe and the Commonwealth of Independent States, the European Bank for Reconstruction and Development (EBRD) is financing a US$ 50 million (ECU 40.6 million) Multi-Project Facility with Compagnie Générale de Chauffe (CGC), a subsidiary of the Compagnie Générale des Eaux (CGE), to develop a network of energy service companies (ESCOs) for the region.
"The EBRD has long recognised the potential of ESCOs in the region. Last year we financed, with Compagnie Générale de Chauffe, the leading Hungarian ESCO, Prometheus, which has evolved beyond our expectations," said Jacques de Larosière, President of the EBRD, at the signing of the agreement today. "By working with such companies as CGC, the EBRD can further develop a greater awareness of energy savings amongst consumers as well as establishing a private sector industry to support it."
Jean-Marie Messier, President of CGE, said: "Our aim - indeed our mission here - is to begin to make real energy savings, and to be in a position to guarantee those savings to our customers. I would like to sincerely thank and congratulate the EBRD for leading the way in providing innovative structures in this field."
The Multi-Project Facility, a funding by the EBRD of one or more of the ESCO project financings sponsored by CGC, will help CGC to establish, acquire and operate service companies providing energy-saving services to both public and private sector clients (such as education, health authorities, municipalities, district heating companies and local enterprises) in central and eastern Europe. The EBRD facility allows for both debt and equity participation in the ESCOs.
The ESCOs will install, at their own expense, appropriate technology in their clients' premises to reduce energy consumption while at the same time providing a guaranteed level of comfort in terms of heating or other energy-related needs. Each ESCO recovers its costs from the realised energy savings. Because few of the clients have access to capital, this form of contracting services, known as Energy Performance Contracting (EPC), is particularly suitable in the EBRD's countries of operations.
The first ESCO to benefit from EBRD financing under the Multi-Project Facility is CGC-Termotech, located in the Slovak Republic, which is receiving an ECU 3.14 million loan and ECU 0.5 million in equity. Active since 1993, the company provides EPCs to public and private clients. One of its recent contracts is the rehabilitation of the heating installations of Poprad, a major city in the Slovak Republic.
CGC is the world's largest thermal energy management and maintenance company. Working in the EBRD countries of operations since 1992, it operates a number of subsidiaries in the Czech Republic, Hungary, Romania and the Slovak Republic.
The EBRD financed a US$ 5 million (ECU 3.8 million) loan to Prometheus, which is 79 per cent owned by CGC, in December 1995.
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