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Photo credit: Curt Carnemark/Worldbank
Washington DC, January 28, 2010 - The CEO of the Global Environment Facility (GEF) has endorsed a $35 million climate change project to boost energy efficiency in Chile. The Inter-American Development Bank (IDB) will implement this project of $2.3 million in GEF grants and $32.6 million in cofinancing. It aims at creating an energy efficiency market in Chile by promoting the active participation of engineering firms and energy services companies as intermediaries in the development of energy savings and efficiency programs.
“There is a huge untapped potential in practically all sectors of the Chilean economy, particularly in the industrial, commercial, residential, public, and transport sectors. This project will address the significant gaps in access to energy efficiency knowledge and technologies” said Monique Barbut, CEO and Chairperson of the Global Environment Facility.
The project is estimated to result in energy savings valued at US$53.8 million and emissions reductions of almost 1 million tonnes over ten years. The abatement cost of the emission reductions is estimated to be US$2.65/tCO2e. This Project will contribute to overcoming the barriers to financing faced by energy efficiency projects, through design, structuring and implementation of a partial credit guarantee program that will support the financing of energy efficiency projects based on energy performance contracts.
“This project called ‘Encouraging the Establishment and Consolidation of an Energy Services Market in Chile’ which complements a second associated project ‘Promoting and Strengthening an Energy Efficiency Market in the Industry Sector in Chile’, also funded by GEF and implemented by the IDB, will provide altogether more than US$ 5 million of GEF funding to strengthen the energy efficiency market in Chile. The program will provide capacity building to the Energy Efficiency Agency of Chile (AChEE, acronym in Spanish), promote pilot projects in energy efficiency and create a partial credit guarantee mechanisms that will reduce the risk for banks to work with ESCOs and energy firms which will significantly enhance and promote energy efficiency throughout the country”, said Cristian Cardenas-Lailhacar, AChEE Director.
“The energy savings of both projects combined are in the order of 1000 GWh during the lifetime of the project, equivalent to the power consumed by at least 4000 small and medium enterprises combined. Both of these projects will contribute to highlight the importance of energy efficiency as one of the most important non conventional ‘sources’ of energy, or the ability of not demanding more energy generation”, said Alexandre Rosa, Infrastructure and Environment Manager of the IDB.
Media contact: Christian Hofer, Senior Communications Officer, GEF, chofer@thegef.org, +1 202 413 4185