Renewable energy attracts Pacific commercial banking sector
It was a question of time before banking institutions realised the potential of the fast growing renewable energy and sustainable development projects sector. Funding for these is no longer restricted to aid agencies, First World<!--more--> governments and philanthropic organisations. Enter the commercial banking sector.
This week, the Fiji Development Bank inked an agreement with a government agency, the Department of Energy, to become a participating financial institution funding renewable energy projects. The agreement falls under the guidelines of a World Bank initiative called the Sustainable Energy Financing Project (SEFP) and uses funding from the Global Environment Facility (GEF).
Thanks to the programme, individuals or groups can apply for loans either with Fiji Development bank or private sector banks like ANZ to fund renewable energy projects in Fiji. The SEFP helps deliver and channel a package of financial incentives through approved participating financial institutions like the said banks to support investments in renewable energy and energy efficiency technologies.
The rural population can also avail of financing for their projects. In their case, the World Bank guarantees 50 per cent of the borrowed amount sharing the risk of lending to rural dwellers where norms for security, interest rates and equity may not meet the standards of private sector banks, which typically target such services in urban centres.
The Fiji Development bank has said it plans to expand its green lending portfolio thereby promoting the proliferation of renewable sources of energy to support economic growth more sustainably.