Hotel Falkensteiner, Belgrade

April 15, 2013

1

IFC – Renewable Energy in Serbia

Nebojša Arsenijević

Balkan Renewable Energy Program Manager

2

IBRDInternational Bank for Reconstruction and Development

IDAInternational

Development Association

IFCInternational

Finance Corporation

MIGAMultilateral

Investment and Guarantee Agency

To promote institutional, legal and regulatory reform

Governments of poorest countries with per capita income of less than $1,025

- Technical assistance- Interest Free Loans- Policy Advice

To promote private sector development

Private companies in 181 member countries

- Equity/Quasi-Equity- Long-term Loans- Risk Management- Advisory Services

To reduce political investment risk

Foreign investors in member countries

- Political Risk Insurance

Est. 1945 Est. 1960 Est. 1956 Est. 1988

Role:

Clients:

Products:

To promote institutional, legal and regulatory reform

Governments of member countries with per capita income between $1,025 and $6,055.

- Technical assistance- Loans- Policy Advice

Shared Mission: To Promote Economic Development and Reduce Poverty

IFC – World Bank Group

3

IFC – Internal StructureAdvisory Services (AS) Investment Services (IS)

Access to Finance (A2F)

Investment Climate (IC)

Sustainable Business Advisory (SBA)

Public – Private Partnership (PPP)

Finance Market (FM)

Infrastructure and Natural Resources

(C3P)Manufacturing, Agribus.

and Services (MAS)

4

Western Balkans Region and BREPProgram funded by: Austrian Ministry of Finance (BMF)

End Date: June, 2016

5

Objective 1: RE Regulatory Framework Improvements

• Identification of legal (regulatory/contractual) obstacles• Drafting of improved legal framework• Raising awareness related to the new legal framework• Support during the adoption processObjective 2: Support to RE Sponsors / Developers

• Information/Knowledge sharing• Project development support• Connection with international sponsors

Objective 3: Support to Financial Institutions (Banks)

• Information/Knowledge sharing• Dedicated Capacity Building - Trainings• Impact Assessment Studies

BREP Objectives

6

Coop. Agreement Ministry – IFC

Consultant Select.Process

Signed Contractwith Consultants

Scoping Mission with stakeholders

Phase 1 Inception

IMPLEMENTATION ACTIVITIES

Phase 2Drafting

Phase 3Official Meeting

Phase 4Workshop

POST-IMPLEMENTATION ACTIVITIES (AS AND WHEN NEEDED)

Supporting Ministry in Parliament New / Amended Laws

Supporting Ministry /GovernmentDecrees

Supporting AgenciesOther secondary regulation

PRE-IMPLEMENTATION ACTIVITIES

O1: Regulatory Framework - Approach

7

O1: RE Regulatory Framework - Activities

8

O1: RE Regulatory Framework - Example

Power Policy and Off-take related set of legal documents:• Renewable Energy Law and bylaws (Decrees)• Standardized Power Purchase Agreement• Standardized Grid Connection AgreementConcession related set of legal documents:• Concession Law• Standardized Concession Contract• Selection Criteria for RE Concessions

Main targets:• To increase transparency and cash flow predictability• Mitigate Risk (standardized contracts, step-in rights)• Alignment with EU directives

9

O2: Support to RE Sponsors - Approach

Market Level

Interventions

Company Level

Interventions

Educational Workshops Educational Materials (brochures, roadmaps, etc.)Support to Local AssociationsInvestment Promotion ActivitiesLocal – International Match Making

Support in Improving Project DocumentsRelationship with local communitySupport with E & S standards (Equator Principles) Support in finance modelingImprovement of Outreach Strategy

10

O2: Support to RE Sponsors - Activities

From B2B to Implementatio

n

11

O2: Support to RE Sponsors - Example

Example 1: Austrian Company• Joint Venture with Albanian concession owner• Program of Activities (PoA) for SHPP in Albania and Serbia• Private Benefit: improved cash-flow (CERs selling)• Public benefit: education, link with PoA Example 2: Bosnian Company• Support with SHPP cascade design improvement• Official review of idea design• Private Benefit: optimized SHPP design• Public benefit: education, brochure with common design mistakes Main Targets• To support private companies with good projects and without IDD issue• To secure certain level of public benefits (education, brochure, etc.)

12

O3: Support to local FIs – Approach

Technical Manual:• SHPP Engineering Manual

• SHPP Legal Manual

• SHPP Budgeting Manual

• SHPP Risk Management Manual

Finance Manual:• SHPP Finance products development and marketing

• Bank organization structure

SHPP Cash Flow Tool

SHPP Project Assessment/Evaluation Toolkit

General Material Development

Country Level

Workshop

Material Adjust. Country Needs

In-depth Capacity Building Training

Joint Assess of first 3 SHPPs

Impact Assess Study

13

O3: Support to local FIs – Activities

14

O3: Support to local FIs - Example

Example 1: In-depth training with local bank in Albania• 3- day training on SHPPs and project finance• Engineering, E&S, Budgeting, Legal, Financial• Private Benefit: new product, increased internal capacity• Public benefit: education, more SHPP project successfully financed

Example 2: Country level workshop for Serbian banks• Presentation of IFC AS product (training)• Presentation of IFC IS products (loan, equity, quasi equity, risk share)• Private Benefit: idea for new product• Public benefit: educationMain Targets• To increase internal capacity of local banks• To slowly change RE market from corporate to project finance.

15

BREP Team

Nebojsa ArsenijevicProgram ManagerBelgrade Office

NArsenijevic@ifc.org

Bajame SefaFinance SpecialistTirana Office (ALB)

BSefa@ifc.org

Dimitar DimitrovskiPolicy/Legal Specialist

Skopje Office (MAC)DDimitrovski@ifc.org

Dzenan MalovicTechnical SpecialistSarajevo Office (BIH)

DMalovic@ifc.org

Denis MesihovicFinance Specialist

Sarajevo Office (MNE)DMesihovic@ifc.org

Shpresa KastratiTechnical Specialist Prishtina Office (KOS)

SKastrati@ifc.org

Bojana RisticOutreach Specialist

Belgrade Office (SRB)BRistic@ifc.org