Crowding in private finance

Closed

Programme Category

EU Competitive Programmes

Programme Name

LIFE: ENVIRONMENT AND CLIMATE ACTION

Programme Description

The LIFE Programme is the EU’s funding instrument for the environment and climate action. The general objective of LIFE is to contribute to the implementation, updating and development of EU environmental and climate policy and legislation by co-financing projects with European added value. After 22 years, €3.4 billion and 4.170 projects, the LIFE Programme continues to finance actions for the environment and climate action. For the 2021-2027 the total budget of the LIFE Programme is €5.4 billion.

Programme Details

Identifier Code

LIFE-2023-CET-PRIVAFIN

Call

Crowding in private finance

Summary

The topic aims to increase the amount of private finance allocated to energy efficiency and small-scale renewable energy sources by establishing innovative financing schemes for investments in sustainable energy and/or engaging with financial institutions to develop financial products and adapt their investment practices.

Detailed Call Description

Proposals should clearly focus on tailored, market-oriented solutions to crowd in private finance at scale for sustainable energy investments, understood as investments in energy efficiency and/or small-scale renewable energy sources and storage.

Proposals are expected to focus on one of the two scopes below. The scope addressed should be specified in the introduction of the proposal.

Scope A: Innovative financing schemes – Proposals should set-up innovative financing schemes leveraging private finance for sustainable energy investments, with a dedicated and clear focus on energy efficiency, in at least 1 eligible country with a clear ambition and effort towards expansion in additional eligible countries. The financing scheme should be operational by the end of the project, whereas the related investments may be implemented after project completion.

The financing schemes can involve, for example but not limited to:

  • Equity, debt, mezzanine financing, potentially combined with non-reimbursable grants (“blending”).
  • Guarantees, risk-sharing, insurances or other de-risking instruments.
  • Energy services such as energy performance contracting and variants thereof, if used to finance the investments.
  • On-bill, on-tax and building-based financing, where the debt is attached to the energy meter or the building rather than the household or company.
  • Schemes complementing, with a dedicated financing component, already existing local and regional technical assistance facilities, in particular integrated home renovation services.
  • Schemes targeting the secondary market, including refinancing mechanisms, specialised securitisation vehicles and green bond schemes.
  • Local investment structures, including citizen financing (e.g. crowdfunding) for energy efficiency.
  • Market-based instruments relevant for sustainable energy (e.g. carbon finance instruments, energy efficiency obligations, etc.).
  • Brokering, aggregation or clearing houses, which facilitate matching of demand and supply of sustainable energy finance.

Scope B: Mainstreaming sustainable energy finance

Proposals should address one or several of the following areas of work:

  • Development, evolution, labelling and certification of financial products, including insurance, as well as provision of information and potential advice to the borrower or investor in order to ensure uptake of green products, with a focus on the retail side and/or capital markets.
  • Evolution of risk and sustainability assessment of private investors by integrating the specificities of energy efficiency and integrated small-scale renewables, including multiple benefits of energy efficiency. The focus can be at project level (e.g. creditworthiness analysis, quality standards, benchmarking data) or at portfolio level (e.g. internal ratings-based approaches, climate stress-testing, analysis of investment strategies, etc.).
  • Benchmarking, tagging, monitoring and disclosure of data on energy efficiency investments and financial performance thereof, including standards to report on the energy performance of investment portfolios (in particular mortgages, consumer loans, corporate loans).
  • Targeted support to policy makers, regulatory bodies and supervisory authorities on sustainable energy related activities, for example on risk ratings and stress testing related to energy performance of assets.
  • Accelerating implementation of EU sustainable finance principles by private investors and/or companies for sustainable energy investments, including for investments not yet covered by the EU taxonomy.
  • Capacity building at all levels of the private finance value chain, in the form of exchanges of best practices, development of training programmes and/or evolution and/or rollout of existing training programmes.

The proposed actions should have a strong component of engagement with the relevant stakeholders in the private finance value chain, including institutional investors, but also retail banking branches, brokers, fund managers, investment advisers, insurers, etc., in order to ensure adoption of the results by market players. Proposals should demonstrate support of the targeted stakeholder groups and how they will be involved throughout the project.

Call Total Budget

€6 500 000

Financing percentage by EU or other bodies / Level of Subsidy or Loan

95%

Expected maximum EU contribution – Scope A, B: €1 500 000

Thematic Categories

  • Energy
  • Environment and Climate Change
  • Industry
  • Small-Medium Enterprises and Competitiveness

Eligibility for Participation

  • Financial Institutions
  • International Organisations
  • Investment Funds
  • Large Enterprises
  • Private Bodies
  • Small and Medium Enterprises (SMEs)
  • State-owned Enterprises

Eligibility For Participation Notes

In order to be eligible, the applicants (beneficiaries and affiliated entities) must be legal entities (public or private bodies) established in EU Member States (including overseas countries and territories (OCTs) or listed EEA countries and countries associated to the LIFE Programme (associated countries) or countries which are in ongoing negotiations for an association agreement and where the agreement enters into force before grant signature.

Proposals must be submitted by at least 3 applicants (beneficiaries; not affiliated entities) from 3 different eligible countries.

The proposed actions should have a strong component of engagement with the relevant stakeholders in the private finance value chain, including institutional investors, but also retail banking branches, brokers, fund managers, investment advisers, insurers, etc., in order to ensure adoption of the results by market players.

Call Opening Date

11/05/2023

Call Closing Date

16/11/2023

National Contact Point(s)

Department of Environment
Ministry of Agriculture, Rural Development and Environment
www.lifecyclamen.com.cy

Contact Persons 
Marilena Papastavrou
Environment Officer, National Contact Point for Environment
Telephone: +357 22 408 926
Email: mpapastavrou@environment.moa.gov.cy

Chrystalla Papastavrou
Environment Officer, National Contact Point for Climate
Telephone: +357 22 408 962
Email: cpapastavrou@environment.moa.gov.cy

EU Contact Point

European Climate, Infrastructure and Environment Executive Agency

https://cinea.ec.europa.eu/life_en

https://cinea.ec.europa.eu/life_en

Contact: https://cinea.ec.europa.eu/contact-0_en