Structuring Kfw Energy Fund

We were happy to go to Eastern Europe to structure an energy fund for KfW but only if our input would make a real difference.

Energy fund
What would be the best way of rolling out a ‘renewable energy and energy efficiency fund’ in the countries to the east of Eastern Europe? That, in a nutshell, was what the Kreditanstalt für Wiederaufbau (KfW) wanted to know. Emerging economies such as Armenia, Georgia and Ukraine are putting their energy infrastructure into place and would profit from an early investment in sustainable options for renewable energy. The KfW wanted to set up an investment fund and asked Rebel to help.

Added value
IMG Rebel looked into the financial side of the fund and worked out a way to organise its financial structure. Which partners and sectors were going to participate? We insisted the project have an added value, i.e. it had to bring something new to what was already happening. Many investors are already exploring this market and we suggested other ways of funding the project involving a longer term, a different risk policy and creative ways of attracting small local businesses.

Sensibly structured fund provides maximum input
This project shows that a well structured fund can make a major contribution to the development of emerging economies and that also implies taking into account a country’s uncertain factors. It is important to select the right local partners and sectors. We also learnt that it is very important to make international financial instituions harmonise their policies so as not to develop parallel projects. We are not holding our breath for the moment but we believe it will happen some time in the future.