Seizing the Financial Opportunities of the Energy Demand
IFC and the World Bank organized jointly a workshop on financial services for sustainable energy projects in East Asia. By coupling the event with a high-level meeting in the region, they attracted top officials from the private sector and government. After the workshop, more than 20 of the regional banks present signed for further training on energy efficiency.
There is a growing demand for energy in East Asia that requires significant investments and the contribution of cleaner energy options. The recently created financial institutions of the region, seeing a role and an opportunity for them, are seeking to increase their knowledge of the risks and rewards of developing a sustainable energy portfolio.
The East Asia Energy Unit of the World Bank invited IFC to become a partner of their sustainable energy training program and bring its private sector expertise to the project. For their first joint training, held in May 2005, IFC and the World Bank introduced banking sector representatives from Cambodia, Lao PDR, Indonesia, Mongolia, the Philippines, and Vietnam to the financial and environmental opportunities offered by financing sustainable, small-scale, decentralized energy solutions.
The workshop demonstrated the profitability and viability of well-structured and well-executed investments in sustainable energy. It provided details on the market for energy service businesses, regulatory conditions, key market drivers, and how to efficiently tap into available technical and financial resources. A businessman from Bangalore India, sharing his experience with the participants, said: “Renewable Energy is no longer a sector that needs attention for its environmental importance. It is in the first place a good business opportunity, generating stable long terms returns on investment”.
At the end of the workshop, more than 20 of the regional banks not only expressed interest in the topic but signed up for a World Bank program to incorporate sustainable energy into their lending practices. This first collaboration between the World Bank and IFC was also the first time that the banks went ahead and signed up for this program.