Unlocking the Energy Saving Potential in Albania’s Residential Sector
March 28, 2014 -- Albania’s residential sector uses more than half the country’s electricity supply, representing a huge opportunity to reduce energy consumption and address energy deficits. IFC is working with Albanian banks to introduce homeowner loans to finance energy efficiency improvements and unlock energy-saving potential across the country.
So far, four IFC clients -- Credins Bank, Besa Fund, NOA, and Societe Generale Albania Bank -- have disbursed more than 2,500 residential energy efficiency loans worth a total of $10 million and helped more than 11,000 people improve their living conditions and save more than 13 million kilowatt hours (kWh) of energy.
Thanks to IFC and its partner financial institutions, more and more Albanian families are benefitting from energy efficiency renovations in their homes. “Our home is much more comfortable now. We used the loan from our bank to fix the windows and insulate the apartment, and our utility bills have decreased significantly,” says a Credins Bank client living in a multi-family building in Tirana, Albania.
To further strengthen energy efficiency in Albania’s residential sector, the IFC advisory team helped draft the new Energy Efficiency Law and corresponding by-laws, incorporating international best practices and ensuring compliance with European Union Standards.
Albania, like many of its neighbors in Eastern Europe, is undergoing a transition to a competitive market economy. Yet its growth is hindered by an insecure energy supply and frequent power shortages. Realizing the energy saving potential of its residential sector will benefit the entire economy, redirecting much needed energy resources to other sectors like production and trade.
"The Albania Residential Energy Efficiency project is a great example of creating synergies between Energy Efficiency and Housing Finance, as well as concerted efforts of investment and advisory teams on the ground," noted Douglas Grayson, IFC Global Head of Housing and Consumer Finance.
In addition, Albania’s experience in residential energy efficiency finance provides a model for other countries in Europe and Central Asia facing similar challenges. IFC is now designing a similar initiative in Kosovo, where residences account for roughly 48 percent of energy consumption and the potential for energy saving is great.