Although it is widely accepted that investments directed to the improvement of energy efficiency have high rates of economic and social return, the majority of these projects remain unimplemented. According to Shi (2007), about 80% of projects surveyed recovered investment costs within 30 months through energy cost savings. The root of the problem is not the lack of capital, but it is the lack of organizational and institutional mechanisms for the implementation of projects. Especially, the current financing mechanisms of these projects remain inefficient. Banks are unwilling to give credits for energy efficiency investments because of uncertainty and lack of experience in this field. High centralization in the distribution of financial resources doesn’t let finance adequately the improvement of energy efficiency of public buildings (schools, hospitals). It means there is urgent need for the introduction of new financing mechanisms of energy efficiency projects.
Dear bloggers, please, share your thoughts on financing options of energy efficiency investment projects.