Technical Session: Innovative Climate Finance approaches for Green Banking in Sri Lanka

Transcription

1 Technical Session: Innovative Climate Finance approaches for Green Banking in Sri Lanka 2nd National Workshop on Innovative Climate Finance Mechanisms for the Financial Institutions in Sri Lanka, 7-8 November Große Theaterstraße Hamburg Germany 2017 the greenwerk.

2 Agenda: Innovative Climate Finance approaches for Green Banking in Sri Lanka Objective: Informing the discussion and group work on further advancing CF & green banking in SL Presentation on Introduction to climate finance instruments for green banking by Ms. Subhi Shama, ESCAP Video Message from Pakistan Presentation on Blending green banking with International Climate Finance by Mr. Bjoern Dransfeld, the greenwerk Response on Experiences and challenges for green banking in Sri Lanka by Mr. Nalin Karunatileka, DFCC Bank Discussion 2

3 Blending green banking with International Climate Finance 2nd National Workshop on Innovative Climate Finance Mechanisms for the Financial Institutions in Sri Lanka, 7-8 November Große Theaterstraße Hamburg Germany 2017 the greenwerk.

4 I. Sri Lanka and intl. Climate Finance 4

5 The ima g Examples for intl CF in Sri Lanka (2015 data CFU) Fund Name of Project Focus Adaptation Fund (AF) Addressing Climate Change Impacts on Marginalized Agricultural Communities Living in the Mahaweli River Basin of Sri Lanka Global Environmental Facility (GEF4) Global Environmental Facility (GEF4) Global Environmental Facility (GEF4) Global Environmental Facility (GEF5) Special Climate Change Fund (SCCF) Special Climate Change Fund (SCCF) Portfolio Approach to Distributed Generation Opportunity (PADGO) (Phase 1) Promoting Sustainable Biomass Energy Production and Modern Bio-Energy Technologies Implementing Agency Approved year Grant Adaptation WFP ,99 Mitigation - general Mitigation - general TT-Pilot (GEF -4): Bamboo Processing for Sri Lanka Mitigation - general Appropriate Mitigation Actions in the Energy Generation and End-Use Sectors in Sri Lanka Resilient and Integrated Urban Development for Greater Colombo Strengthening the Resilience of Post Conflict Recovery and Development to Climate Change Risks in Sri Lanka Mitigation - general IBRD ,60 UNDP ,00 UNIDO ,36 UNDP ,79 Adaptation ,20 Adaptation UNDP ,18 Strategic Priority on Adaptation (SPA) (from GEF4) UNREDD Program Participatory Coastal Zone Restoration and Sustainable Management in the Eastern Province of Post-Tsunami Sri Lanka Direct support to the design and implementation of UN- REDD National Programmes Adaptation IFAD 2,10 Mitigation - REDD FAO / UNDP / UNEP ,00 info@thegreenwerk.net 5

6 The ima g Examples for intl CF in Sri Lanka (ctd) GCF: 1 adaptation project UNDP, irrigation management, FP16 Strengthening the resilience of smallholder farmers in the Dry Zone to climate variability and extreme events through an integrated approach to water management, UNDP, Sri Lanka Improving the community irrigation water infrastructure, scaling-up decentralized drinking water systems, and strengthening early weather warnings, floodresponse, and water management USD, 52 million with a USD 38 million grant from GCF, and co-finance from SL Gvt of USD 14 million grant National Designated Authority (NDA): MINISTRY OF MAHAWELI DEVELOPMENT AND ENVIRONMENT Readiness Proposal in Pipeline: NDA strengthening and country programme Readiness Partner: UNEP, Purpose: Amount: USD 0.8 million info@thegreenwerk.net 6

7 II. Examples from other countries 7

8 Online trainings Trainings in India, Indonesia, Philippines, Thailand and Vietnam Delegation tours & B2B meetings in Germany Green Finance Specialist program Train-the-Trainer Seminars at RENAC s Training Centre in Berlin info@thegreenwerk.net 8

9 Example: Indonesia Indonesian Climate Change Trust Fund (ICCTF) Purpose and organisation: created in 2009 to deliver international finance to national strategies funding decisions are at country level, UNDP was interim Trustee (now local Bank) First phase: Innovation Fund o o o mostly grant funding from public & international sources (development partners, i.e. bilateral and multilateral donors) channelled to line ministries for climate-change related projects by end 2015: US$16.71 deposited, US$ 7.69 million disbursed to 16 projects Second phase planned: Transformation Fund o public-private partnerships, loans, and world capital markets to increase private-sector finance So far, the ICCTF remains at first stage info@thegreenwerk.net 9

10 Example: Indonesia Source: ICCTF

11 Example: Viet Nam Green Investment Facility (GIF) established in 2015 as part of the Low Carbon Transition in Energy Efficiency Sector (LCEE) program and under the lead of the Vietnamese Ministry of Industry and Trade (MOIT) with financial support from the Government of Denmark (GoDK) supports local SMEs in getting access to funding for EE projects by offering guarantees and Energy Saving Awards (performance-based grants) Features: o o concentrates on a limited number of sectors (food industry, ceramics industry, brick industry) and prioritizes certain technology solutions apart from SMEs, Energy Service Companies (ESCOs) are also eligible for GIF support, in case they are providing solutions to SMEs within the target sectors Currently in its pilot phase ( ): GIF is equipped with a total funding volume of USD 5.2 mio o Guarantee: VND 200 million - VND 4 billion (USD to USD ) o Energy Saving Awards: up to 30 percent of the principle value of the loan requested by the SME info@thegreenwerk.net 11

12 Example: Viet Nam Source: GIF

13 Example: Philippines Example: Sustainable Energy Finance (SEF) Program launched in 2009 as a cooperation between the International Finance Corporation (IFC) and the Bank of the Philippine Islands (BPI) designed to encourage local enterprises (e.g. industrial/manufacturing companies, equipment vendors/integrators, agri-business) to invest in RE and EE solutions Investment options: capital expenditure, working capital financing, equipment leasing BPI offers market-rate loans (max. USD 4 mio) and IFC provides guarantees (50% of loan amount requested) BPI put an emphasis on a client-oriented application process (e.g. free walkthrough energy audit and a validation of financial and technical data) Results: between 2009 and 2015 the SEF Program has provided loans for projects worth USD 698 mio in total, leading to a reduction of GHG emissions by up to 1.9 mio tons/year info@thegreenwerk.net 13

14 Sustainable Energy Finance (SEF) Program Introductory meeting Submission of energy consumption and equipment data/project information memorandum Conduct walkthrough energy audit/valdiate financial and technical data Compute potential savings for EE project and prepare financing recommendation for RE projec Presentation of results to client Loan Packaging Source: BPI

15 Thank you very much! Björn Dransfeld Founding Partner the greenwerk. Climate Advisory Network the greenwerk.

16 Discussion 16

17 Discussion: Innovative Climate Finance approaches for Green Banking in Sri Lanka A - Understanding your experiences with climate finance / sustainable finance / green banking: 1. What examples can you share from your daily work? 2. Are there specific positive highlights / success factors? 3. Are there specific barriers preventing work in this context? B - What is required to mainstream success factors (Roadmap, SBI), what is required to overcoming barriers? C - Where and how could international climate finance support Sri Lanka? info@thegreenwerk.net 17

18 Group Work 18

19 Group Work: Innovative Climate Finance approaches for Green Banking in Sri Lanka Format: Small break out groups, you have minutes Task: What are the TOP 5 needs you identify to move forward towards sustainable banking (What & how)? Document it on paper! info@thegreenwerk.net 19