Unlocking 25 million in commercial finance for renewable energy

The Millennium Foundation Kosovo (MFK) signed a contract with the Financial Markets International, Inc. (FMI) to commence the implementation of the Renewable Energy Independent Power Producer (IPP) Facilitation Project, supported by the Millennium Challenge Corporation (MCC). This project aims to support Kosovo Credit Guarantee Fund (KCGF), the Renewable Energy IPPs, as well as local banks by focusing on three complementary interventions to increase solar energy financing.

 

Through a blended finance approach, MFK will help KCGF unlock 25 million USD in commercial finance for renewable energy, thus fostering the renewable energy sector in Kosovo. Three key components of the project are:

 

  • Providing technical assistance and capacity building to establish KCGF’s new renewable energy guarantee window in project financing; 
  • Launching a project accelerator focused on qualitative project screening and development of bankable projects by independent power producers; 
  • Standardizing the market through a toolkit for training and project standardization to help KCGF partner banks assess risk factors when evaluating solar generation projects

 

Petrit Selimi, MFK CEO,  stated that “MFK is very happy that an experienced company such as FMI will help KCGF expand their portfolio and capacities so new financing opportunities become available for renewable energy in Kosovo”.

 

Financial Markets International (FMI) in a written statement, announced that it considers this project to be a key to accelerating the renewable energy market in the country. Furthermore, FMI stated that “This Project by MFK represents a vital opportunity to support new sources of commercial financing and risk mitigation tools to better fund Renewable Energy IPPs. FMI is thrilled to continue our work with the KCGF, while supporting Kosovo’s efforts to combat climate change and reduce greenhouse gas emissions though increased usage of renewable energy”- FMI added.

 

On the other hand, Besnik Berisha, the Managing Director of KCGF, expressed the enthusiasm of KCGF team on starting this cooperation. “We believe that long term experience of FMI will be very beneficial for building institutional experience in the sector of RE energy and project finance”- Mr. Berisha pointed out.

 

ABOUT THE ENTITIES:

Millennium Foundation Kosovo (MFK) is an independent foundation set up in 2018 to implement the Threshold Agreement between Kosovo Government and the Millennium Challenge Corporation, worth 49 million USD. MCC’s Kosovo Threshold Program addresses two key constraints to Kosovo’s economic growth: an unreliable supply of electricity; and real and perceived weakness in rule of law, government accountability and transparency. 

 

The Kosovo Credit Guarantee Fund (KCGF) is a local, independent, sustainable credit guarantee facility issuing portfolio loan guarantees to financial institutions to cover up to 50% of the risk for loans for micro, small, and medium enterprises (MSMEs). KCGF helps financial institutions lend to viable MSMEs that might not have quite qualified without the guarantee to receive a loan, or, if it had a loan, would not have qualified to obtain the additional financing it needed to grow.

 

Financial Markets International, Inc. (FMI) is an international law and economics consulting firm that specializes in helping emerging market countries to achieve economic growth and development through a reliance on market mechanisms, application of international best practices, and legal and regulatory reform. FMI has been at the forefront of emerging market development since 1992 – and has implemented over $200 million in technical assistance programs for international donors and governments. By design, FMI is a small, highly-specialized firm with one mission: to deliver innovative and sustainable solutions to complex financial sector challenges.

 

Date: 12.02.2020

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