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Loan

A loan is a form of debt financing that is repaid with interest over a set period of time. A loan can be secured through collateral. For project finance, the collateral could be the project itself. For corporate finance, it would be the corporation's assets.

Loan Guarantees: A Complete Clean Energy Finance Guide

This resource—which is one of many instrument summaries offered by the Clean Energy Finance Solutions Center—provides in-depth information about loan guarantees, including best practices, case studies, design and implementation information, experts and training opportunities.

Green Banks: A Complete Clean Energy Finance Guide

This resource—which is one of many instrument summaries offered by the Clean Energy Finance Solutions Center—provides in-depth information about green banks, including best practices, case studies, design and implementation information, experts and training opportunities.

Feed-In Tariffs: A Complete Clean Energy Finance Guide

This resource—which is one of many instrument summaries offered by the Clean Energy Finance Solutions Center—provides in-depth information about feed-In tariffs, including best practices, case studies, design and implementation information, experts and training opportunities.

Green Banks

Green banks are innovative public-private or quasi-public institutions supporting the provision of long-term and low-cost financing for clean energy projects (EPA 2015). Green banks are often designed to use seed capital from the public sector to leverage significant amounts of private investment for clean energy projects and to eventually operate under a self-sustaining business model. Green banks are often intended to support technologies or products for which traditional market lending is not yet in place. Thus, green banks can be positioned as a fairly middle-ground policy support for technologies that are not totally reliant on incentives or grant dollars and do offer some payback, but that still need some assistance securing financing.

An important feature of the bank is its nature as a revolving loan fund—distinct from grant-based products, as you get to use the same funding over and over to lend to more projects. Green bank products are normally designed to ensure financial returns to the bank that will allow the institution to be self-sustaining; for this reason, rebates and grants are not normally managed through green banks (EPA 2015, Kennan 2014). Financial incentive products and programs, such as concessional loans, loan guarantees and green bonds can be consolidated and managed under green banks. This allows for greater efficiency and reduced administration costs across the incentives (EPA 2015, Kennan 2014). Green banks can support a multiplier effect for public funds invested in clean energy through attracting significant private investment using minimal public seed capital (Kennan 2014; Lecacheur 2010).

Green banks are also empowered to explore innovative financing approaches. For example, green banks can implement financing mechanisms that may result in greater financial benefit for the private sector investing partner than for the green bank itself (EPA 2015; Kennan 2014). Another role of the banks is to help educate the lending community on emerging technologies. For example, they sometimes provide underwriting support or expertise for specific products to help the rest of the private sector be comfortable with lending for clean technologies. Green banks can be focused on business, consumers, or both.

Credit Guarantees: Challenging Their Role in Improving Access to Finance in the Pacific Region

Despite adequate liquidity, commercial banks in the Pacific are often reluctant to extend business credit, which is a serious constraint to business operations and broader economic development. The Pacific Private Sector Development Initiative—a regional technical assistance facility cofinanced by ADB, the Government of Australia, and the Government of New Zealand—has undertaken landmark secured transaction reforms in eight Pacific Island countries.

Reliable and Affordable Off-grid Electricity Services for the Poor: Lessons from the World Bank Group Experience

Article abstract" "This learning product draws upon existing IEG evaluations, project documents and analytical work relating to the World Bank Group’s (WBG’s) experience with supporting efforts towards the rapid scale up of off-grid electrification (pico-solar products, individual solar home systems, and micro and mini-grids), in client countries. The focus is on experiences geared towards efficiently and effectively integrating off-grid electrification scale-up efforts with grid rollout – within a national roadmap for achieving universal access in a given time-frame.

Greening India’s Financial Market: Opportunities for a Green Bank in India

This report on green banks is aimed at finding the best and most plausible ways to accelerate the growth of India’s clean energy market. The authors report five takeaways: (1) a green bank is an institution that is more than the sum of its parts, (2) better financing terms means more projects, lower cost energy and lower subsidy costs, (3) green banks keep lending costs low, (4) investment partnerships bring new players on board and (5) green banks facilitate the scaling up of distributed clean energy resources.

Setting Up A Green Bank: A Solution to India’s Clean Energy Finance Barriers

This fact sheet is part of the Natural Resources Defense Council’s and the Council on Energy, Environment and Water’s India Clean Energy Finance Series, which is aimed at finding the best and most plausible ways to accelerate the growth of India’s clean energy market. It describes the process for establishing a green bank in four phases: (1) scoping and education, (2) analysis and investigation, (3) establishment and (4) operations.

Energy Efficiency: Lessons Learned from Success Stories

This study was designed to analyze the energy efficiency policies in seven countries that were successful in achieving low energy intensities or in reducing their energy intensity considerably. The authors analyze the evolution of the energy intensity of these countries from 1990 to 2007, identifying points of inflection in the progress towards improvements.

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