MonSEFF | |Low interest loan | Free expertise | Energy efficiency project About

Want to replace your old unreliable equipment with technologies that reduce costs and enhance productivity?

MonSEFF loans are available for modern, energy efficient equipment and renewable energy solutions.

To finance such investments, MonSEFF loans are unbeatable because they are:

• For everyone, large or small:
  Loans are available for up to USD 2.5 million.
• Cost-saving:
  Our case studies demonstrate how quickly energy-saving equipment pays back.
• Available with free expertise:
  Our team of national and international experts advise on the optimal solution at no cost to you.

Energy efficiency loans are available for a wide range of projects, including:

• Retrofitting of existing plant, equipment, production processes or energy efficiency of the building itself;
• Modification or expansion of production capacity.

Renewable energy loans are available for:

• Hydroelectricity, wind power, biomass/biogas and solar installations that are designed for self consumption.

MonSEFF investments must comply with the following financial and technical eligibility criteria:

1. Energy savings of at least 15%, compared with the piece of equipment being replaced. (Equipment should preferably be new.)
2. Internal Rate of Return (IRR) of at least 10% for energy efficiency projects; and a positive 0% for renewable energy projects.
3. Renewable projects should replace some of the investor’s current consumption of fossil fuel resources

Financial requirements:

1. Loans will be in local currency for up to 100% of project costs.
2. Maximum loan amount per project: USD 2.5 mln (larger projects will need to find additional sources of funding).
3. Minimum loan amount: Established by the partner bank.
4. Terms and conditions: Established by the partner bank.

Mongolian Sustainable Energy Financing Facility is a USD 25 million credit line provided by the European Bank for Reconstruction and Development (EBRD) to partner commercial banks in Mongolia.

The goal is to help fund loans to businesses wanting to invest in energy efficient and renewable energy technologies.

This helps businesses increase their sustainability and competitiveness, while protecting the environment by reducing CO2 emissions.

MonSEFF is just one of a series of Sustainable Energy Financing Facilities (SEFFs) developed by the EBRD.

To date, it has committed more than EUR 2.6 billion in 20 countries.

What is special about the EBRD’s SEFFs is that the funding comes with free advice from a team of experts, who can help advise the banks and clients on investments that pay back quickly.

The MonSEFF team is funded by the EBRD’s Shareholder Special Fund. Typically, all upgrades of old equipment will improve energy efficiency, but some will achieve much better savings than others.

So it is worth making sure that the equipment you choose is appropriate for Mongolia and will result in savings, in order to pay back the loan quickly.

MonSEFF is available because Mongolian industry needs sustainable growth. Given the energy challenges and investment needs, there is little doubt that energy prices will rise, and that firms need to do what they can to reduce their dependency of energy based on fossil fuels and make greater use of renewable energy sources.

MonSEFF represents a tremendous opportunity to help businesses become more competitive because modern energy efficient equipment does not only save energy.

It also reduces break-downs, boosts productivity, improves quality, and boosts competitiveness.
MonSEFF is supported by the EBRD’s Special Shareholder Fund, which is paying for a team of experts to provide free of charge technical assistance to the banks and their clients to identify and prioritise investments that will save energy and other costs to pay back quickly.
The MonSEFF team is made available by an Italian Engineering company D´Appolonia with extensive experience of implementing such programmes, in consortium with two Mongolian companies.

Sustainability is an Australian-based consultancy firm that is focused on sustainable solutions and Icon Consulting is an engineering company.

Benefits for the Sub-Borrowers

• Free technical assistance by senior international and local specialists
  • Detailed energy audits (market value of 35-40 k€);  
  • Identification of EE and RE investment opportunities;  
  • Technical and financial  assessment  of  EE and RE technologies;  
  • Advice on how to select equipment suppliers and  manage the risks for successful project  implementation;  
  • Support in communication with partner banks.  
     
• Reduced operational costs from energy saving/renewable energy production
  • Breakdowns reduction;  
  • Productivity boost;  
  • Quality improvement;  
  • Competitiveness increase.  

Benefits for the Banks:

• Free marketing support
  • Effective promotion of the MonSEFF credit line  throughout Mongolia with a clear and recognizable visual identity;
  • Organisation of public promotional events.

• Significant pipeline of projects  with reduced investment risks;  
• Increased  competitiveness for the Banks by offering a new, cost saving product for enterprises;  
• Attraction of new clients wishing to reduce operating costs;  
• Energy Audits as marketing tool to identify new low risk investment opportunities;  
• Training and ongoing support for loan officers.