Europe to fund renewables in developing world
Europe has announced plans to back investment in renewable energy in Africa and other parts of the developing world in an effort to provide reliable electricity in an environmentally sustainable way.
The fund will target small-scale projects, predominantly in African states.
According to EC statistics, around 1.6 billion people have no regular access to reliable energy sources.
Despite upbeat predictions about the future of clean technologies, promoters of energy efficiency and renewable energy projects often face difficulties in raising commercial funding, the growing concern lying in the lack of risk capital.
The EC believes its new fund will go some way towards addressing both of these problems.
Stavros Dimas, Environment Commissioner, said: "Developing countries must have access to affordable and clean energy supplies: this is a prerequisite for sustainable development. This fund can foster private investments and become a real source of sustainable development, especially in Africa".
The GEEREF aims to help overcome these barriers to investments by providing new risk-sharing and co-financing options to mobilise international and domestic investments.
It is an innovative global risk capital fund that will use limited public money to mobilise private investment in small scale energy efficiency and renewable energy projects in developing countries and economies in transition.
Priority will be given to deploying environmentally sound technologies with a proven technical track record.
The focus will be on investments below Euro 10 million as these are mostly ignored by commercial investors and international finance institutions.
The seed money from the EC is expected to draw in additional funding from public bodies and venture capitalists.