Summary sheet
The framework loan will enable the intermediary to finance small- and medium-scale renewable energy investments that contribute to climate change mitigation.
The aim is to support the development of renewable energy projects in Italy, contributing to achieve renewable energy targets in the country and consequently in the European Union.
The EIB investment in the project will support the construction of new renewable energy (RE) capacity in Italy, crucial for the achievement of the 2030 targets set out in the final National Energy and Climate Plan. The promoter will play the role of aggregator for small energy projects. Therefore, this operation addresses the market failures that limit access to finance to small renewable energy projects, despite the pivotal role they play in contributing to EU energy policy objectives and in the decarbonisation strategy to achieve Paris goals. Moreover, as the Wind and solar PV projects produce electricity from low carbon sources they address the market failure of negative climate and environmental externalities, through the reduction of carbon and air pollution (compared to fossil fuel generation).
In terms of project results, the project is expected to have a positive economic rate of return, considering the economic value of the electricity generated. Therefore, the project is expected to deliver a positive broader social benefit by generating clean and renewable power at a cost (LCOE) reasonably below the alternatives in Italy. On project quality, the level of promoter's governance and risk management capability after mitigation measures is deemed good.
The EIB financing accelerates the implementation of the underlying projects as it contributes to their bankability by lowering their cost of funding and offering a tenor longer than the one usually proposed by other financers. The EIB support to the project will also contribute to crowding-in other financers, sending a positive signal to the market regarding soundness of the underlying schemes.
The investments will generate environmental benefits in terms of reduction of air pollutants and greenhouse gas emissions, ultimately helping to mitigate climate change. They are expected to have limited social and environmental impacts and any such impact is expected to be mitigated. The Bank will assess the capacity and procedures of the financial intermediary to ensure compliance with the national and EU legislation.
The majority of the schemes are expected to be developed by private entities/promoters that are not subject to EU Procurement Directives. For those schemes where public procedures would apply, the financial intermediary will be required to confirm that procurement is carried out in line with the requirements for public sector projects under the relevant national and EU legislation.