National Roundtable on Financing energy efficiency in Malta
The Secretary General of the Malta Bankers’ Association (MBA), Karol Gabarretta, recently moderated one of the topic panel group sessions at the National Roundtable on Financing Energy Efficiency in Malta held on the 6th June. The Roundtable was organised by the European Commission in partnership with the UN Environment Finance Initiative and the Ministry of Transport, Infrastructure and Capital Projects of Malta. The session, which specifically dealt with De-risking Energy Efficiency Investment, also featured interventions from representatives of various members of the MBA and explored several aspects of the financing of energy efficiency measures by institutions locally - such as; lack of evidence on the performance of energy efficiency investments which makes the resultant benefits and the associated financial risk, harder to assess while a lack of commonly agreed procedures and standards for the underwriting energy efficiency investments, increases transaction costs.
During the breakout discussions, Mr Gabarretta acknowledged that while financing of energy efficient measures locally may still be a growing market, he envisages that any shift in such financing may in future require a significant transformation in three main areas:
· through heightened awareness, which could at most require a culture change, at the level of both potential beneficiaries of financing of energy efficient measures and suppliers of such finance, principally banks;
· implementation of incentives primarily aimed at potential beneficiaries of financing of energy efficient measures (although banks as principal suppliers of such finance, should also be potential recipients) could prove to make such schemes much more attractive and duplicate the success achieved locally in the area of renewable energy solutions;
· inevitably, regulatory measures may also be warranted to address the effects of any market failures in this area.
Mr Gabarretta also confirmed that the MBA as banking association will encourage dissemination and adoption amongst its members of the Energy Efficiency Financial Institutions Group (EEFIG) Underwriting Toolkit, https://valueandrisk.eefig.eu/ The Toolkit, which was launched in June 2017, is a guide for value and risk appraisal specifically with respect to energy efficiency financing and is designed to assist financial institutions to scale up their deployment of capital into this area.