Energy efficiency presents an enormous potential to mitigate climate change while contributing to sustainable development and resource efficiency. According to the International Energy Agency, energy efficiency accounts for 49% of the measures needed to stay in line with a 2°C degrees scenario globally (and 56 % in G20 countries). It also generates multiple benefits including local jobs, increased productivity and competitiveness of companies, improvements in air quality and health, energy access and energy security. A significant scaling up of investment in energy efficiency is urgently needed to meet global objectives.

The UN Environment Finance Initiative (UNEP FI) is engaged in cross-cutting work on energy efficiency finance, with investors, banks and insurers, steering international policy dialogues including in the G20 and with the European Commission. In parallel, UNEP FI reaches out to financial institutions, individually or through various networks, to support this developing work, give more importance to energy efficiency, and scale up their energy efficiency financing.

UNEP FI’s main areas of work on energy efficiency finance include:

  • Promotion of Energy Efficiency Finance in the G20
  • Global mobilization of investors and banks on energy efficiency
  • Policy dialogue at the European level – the Energy Efficiency Financial Institutions Group (EEFIG)

UNEP FI is also a member in committees of several peer initiatives on the topic:

  • In the Advisory Committee of the project led by the European Mortgage Federation and European Covered Bond Council (EMF-ECBC) on energy efficiency mortgages,
  • In the Low Carbon Buildings Technical Working Group of the Climate Bond Initiative

Promoting Energy Efficiency Investment in the G20

The topic of energy efficiency and its financing entered the G20 agenda with the adoption of the Energy Efficiency Action Plan at the 2014 G20 Leaders Summit in Brisbane. The Internal Partnership for Energy Efficiency Cooperation (IPEEC) was mandated to support the G20 energy efficiency collaboration and it coordinates a work stream dedicated to finance, the Energy Efficiency Finance Task Group (EEFTG). Co-chaired by France and Mexico, EEFTG currently counts 15 member countries and aims to create awareness on the need to scale up energy efficiency investments and put in place supportive policy environments. UNEP FI is part of the Secretariat of this working group, along with the co-Chairs, IPEEC, and Climate & Strategy Partners. As the global partnership between United Nations Environment and the financial sector, UNEP FI is a credible partner to represent the financial sector in this policy dialogue, reaching out to its members globally, as well as to peer finance networks.

EEFTG has developed G20 Voluntary Energy Efficiency Investment Principles for Participating Countries, a policy framework to catalyze public and private investments in energy efficiency. These five principles were welcomed by the G20 Energy Ministers in their 2015 Communiqué. Under its G20 Presidency, China put the spotlight on energy efficiency with the proposal of new G20 energy efficiency strategy. Adopted in June 2016 by G20 countries, the Energy Efficiency Leading Program refers to the Voluntary Energy Efficiency Investment Principles, consolidating their impact. The topic of energy efficiency investment was also specifically mentioned in the 2016 Energy Communiqué.

EEFTG 2016 Activity Report
EEFTG 2015 Activity Report

As a further major development, the G20 EEFTG released the G20 Energy Efficiency Investment Toolkit in 2017, which provides a collaborative architecture for countries to exchange best practices in scaling up energy efficiency investment and aims to establish a structured dialogue between private financial institutions, public development banks and policy-makers. The Toolkit was referenced in the G20 Climate and Energy Action Plan for Growth adopted at the G20 summit 2017 in Hamburg.

Global mobilization of financial institutions (G20, COP)

In conjunction with several partners, UNEP FI is leading a global mobilization of banks and investors committing to enhance their energy efficiency financing activities. Initiated in 2015, this mobilization gathers investors managing more than USD 4 trillion of assets and over 120 banks from over 40 countries. Unprecedented in nature and scale, this initiative is promoted in the G20 process, COPs and other international platforms in order to send a strong signal on the interest and readiness of the private financial sector to scale up energy efficiency investments. It also allows to constitute a community of committed financial institutions among which to facilitate knowledge and experience sharing and disseminate of best practices to increase energy efficiency financing. For additional information and to join the mobilization, don’t hesitate to contact us at annie.degen[at]unep.org

Investors

Supported by investors managing more than USD 4 trillion of assets, the G20 Energy Efficiency Investor Statement highlights six areas where investors can act to increase energy efficiency in their portfolios of investments in companies (as shareholders) and/or directly in projects. UNEP FI partnered with CERES and the PRI for the first global mobilization on the topic.

Banks

In 2015, UNEP FI has partnered with the European Bank for Reconstruction and Development (EBRD) to reach out to commercial banks on energy efficiency. Launched at a dedicated event in Istanbul before COP21, the Statement by Financial Institutions on Energy Efficiency and has since then received the support of more than 120 banks from more than 40 countries. This sends a highly positive message from banks on the increasing relevance of energy efficiency finance for all countries to mitigate climate change and meet the Sustainable Development Goals.

Chinese banks joining the mobilization

Policy dialogue at the European level

Energy efficiency is crucial to the EU’s climate and energy strategy and provides attractive opportunities for financial institutions. Presently, however, there is largely insufficient public and private investment in energy efficiency in buildings, industry and SMEs. In 2013, UNEP FI initiated a policy/finance dialogue with the European Commission as co-convener of the Energy Efficiency Financial Institution Group (EEFIG), which gathered over 100 participants, to discuss the barriers and drivers of energy efficiency financing in buildings, industry and SMEs. The first phase of that work led to the publication of a landmark report in 2015 “Energy Efficiency – The first fuel for the EU economy” formulating key recommendations to policy makers and financial institutions, for buildings and for industry/SMEs, to overcome existing challenges and scale up energy efficiency investments across the EU. In a second phase started in 2016, the ‘Energy Efficiency De-risking Project’ was launched to develop an open source database on performance monitoring and benchmarking of energy efficiency investments. The aim of this platform is to strengthen the trust of financial institutions as well as of policy-makers in energy efficiency investment opportunities.

The de-risking project recently developed a common risk and value appraisal framework, the EEFIG Underwriting Toolkit.

Executive Summary of the Report
Full report: Energy Efficiency – The first fuel for the EU economy

UNEP FI is also closely associated and supporting other follow-up work post EEFIG report:

  • At country level, in France, we participated to the one-year work on the financing of energy efficiency retrofits in residential properties, animated by Vesta Conseil and Climate Strategy & Partners, with ECF funding.
  • With banks at European level, UNEP FI brings its support and experience by participating to the Advisory Committee of the EMF-ECBC project on energy efficient mortgages.
  • Blog: Investing in Energy Efficiency gets a boost at G20 Hamburg summit

    Energy efficiency has been sitting at the core of sustainability discussions within the G20 for several years, and has emerged as a key consensus area across the G20 countries. UNEP FI’s Martin Schoenberg provides his take on what the recent G20 summit means for energy efficiency investment going forward, and the role of the G20 Energy […]

  • EEFIG Underwriting Toolkit provides common framework to boost energy efficiency investment

    The Energy Efficiency Financial Institutions Group (EEFIG) Underwriting Toolkit launched on June 22nd 2017, during the EU Sustainable Energy Week in Brussels. EEFIG is a partnership between UNEP FI and the European Commission. The report provides a common framework for financial institutions, project developers and hosts of energy efficiency projects such as companies and consumers to […]

  • G20 Energy Efficiency Investment Toolkit presented at Clean Energy Ministerial in China

    The 8th Clean Energy Ministerial in China saw the Asian launch of the G20 Energy Efficiency Investment Toolkit to a packed audience of policy-makers, cleantech entrepreneurs, investors and financiers. The Clean Energy Ministerials are senior-level meetings dedicated to accelerating the global clean energy transition. The Asian launch was was organised by the G20 Energy Efficiency Finance Task […]

  • G20 Energy Efficiency Investment Toolkit highlights US$ 221 billion investment opportunities

      According to the International Energy Agency’s analysis, more than USD 221 billion is being invested annually into energy efficiency improvements in buildings, industry and transport in the G20 economies. More than half of this investment is into the buildings sector. UNEP FI has contributed to the G20’s Energy Efficiency Investment Toolkit, which provides guidance on […]

  • BLOG: G20 Energy Efficiency Investment Toolkit marks culmination of three years of UNEP FI engagement with the G20

     G20 Energy Efficiency Finance Task Group Rapporteur Peter Sweatman presenting the Toolkit at the G20 Energy Efficiency Forum in Hamburg The G20 Energy Efficiency Investment Toolkit marks the culmination of three years of UNEP FI engagement with the G20. Public and private sector financial institutions are increasingly tackling the energy efficiency investment opportunity by sharing […]

  • G20 Energy Efficiency Finance Task Group (EEFTG) 2016 Activity Report

    In 2016, G20 nations adopted a new long-term strategy for energy efficiency, the Energy Efficiency Leading Program, emphasizing the key role of finance. The topic was also highlighted in the Leaders Communiqué and embedded in the Synthesis Report of the G20 Green Finance Study Group. In parallel, through the mobilisation launched by UNEP FI, $4 […]

  • Global stocktaking: How banks finance energy efficiency?

    As part of the Secretariat of the G20 Energy Efficiency Finance Task Group and the only representative of the private financial sector there, UNEP FI has been leading a global mobilization on energy efficiency finance since COP 21. Currently close to 120 banks from over 40 countries have endorsed the Statement of Financial Institutions on […]

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    Facing acute environmental challenges, China has made the greening of its economy a priority and has embraced sustainable finance with a remarkable leap in the green bond market in 2016. Energy efficiency is recognized a key measure to reduce emissions of greenhouse gas and other pollutants. In 2015, financial authorities issued credit guidelines to stimulate […]

  • Workshop in China: Enhancing Financial Flows for Energy Efficiency in the Building Sector

    Under the Chinese presidency and in the context of its work in the G20 Energy Efficiency Finance Task Group Secretariat, UNEP FI organized a workshop on Enhancing Financial Flows for Energy Efficiency in the Building Sector in China, with the support of SWITCH-Asia. Held on April 15th back to back to the G20 meeting on […]

  • Webinar: Deployment of Energy Efficient Mortgages in Europe

    26 September 2017, 11:00 PM CET | Webinar
    The European Union’s Energy Union Framework Strategy includes energy efficiency as one of its five dimensions and states it is to be considered as an energy source in its own right. The ambitious Paris climate agreement also underlines the importance of energy efficiency. To realise its full potential, public funds will not suffice and private financing will have to be unlocked on a large scale. This webinar, organised in partnership with the European Commission, will discuss the use of energy efficient mortgages in Europe.
    Register by 22 September 2017.

  • UNEP FI Member Webinar: Energy Efficiency Financial Institutions Group – Consultation on the Third Phase

    13 September 2017, 2:30 PM CEST | Webinar

    The Energy Efficiency Financial Institutions Group (EEFIG) is a partnership between UN Environment Finance Initiative and the European Commission to scale up energy efficiency financing and investment. This webinar for UNEP FI members is to seek your views on the future development of EEFIG, which will enter its third phase in 2018.

  • Financing Energy Efficiency in the Republic of Ireland and the United Kingdom

    Thursday 28 September 2017 | Dublin, Ireland

    The event aims to share best practice from the Republic of Ireland, the UK and further afield on how energy efficiency can be financed through private funds and innovative financing instruments, notably in the building and SME sectors. Speakers will focus on practical experience in developing, structuring and financing energy efficiency investment programmes.

  • Financing Energy Efficiency: The Key Role of Standardisation and Benchmarking

    Wednesday, 28 June 2017 | Webinar

    This webinar, organised by the European Commission in partnership with the UN Environment Finance Initiative, will discuss the role of standardisation and benchmarking in order to facilitate access to finance for energy efficiency investments.

  • Third Stakeholder Meeting of the EMF-ECBC Energy Efficiency Mortgages Initiative

    Friday 9 June 2017 | Rome, Italy

    UNEP FI supports the Energy Efficient Mortgage Initiative launched last year by the European Mortgage Federation- European Covered Bond Council (EMF-ECBC) which will have its third stakeholder meeting and kick off of the Energy Efficient Mortgages Action Plan on June 9.

  • Financing Energy Efficiency in the Nordic Region

    Friday 19 May 2017 | Copenhagen, Denmark

    The event aims to share best practice from Denmark, Sweden and Finland on how energy efficiency can be financed through private funds and innovative financing instruments, notably in the building and industry sectors. The event is organised as part of a series of events over three years, seeking to build and support long-lasting action in EU Member States.

  • Financing Energy Efficiency in Central Europe

    Thursday 27 April 2017 | Prague, Czech Republic

    Targeting the Czech Republic, Slovakia, Hungary and Austria, this event aims to share best practice from the region on how energy efficiency can be financed through private funds and innovative financing instruments, notably in the building and industry sectors. The event is organised as part of a series of events over three years, seeking to build and support long-lasting action in EU Member States.

  • Innovative Financial Instruments to Support Private Sector Investments in Energy Efficiency: Experiences and Lessons Learned from the Latin-American and Asia-Pacific Regions

    15-16 November 2016 | Lima, Perú
    This event aims to promote a dialogue and exchange of experiences among Financial Institutions from Latin America and the Caribbean (LAC) and the Asia-Pacific (APAC) regions about the challenges and opportunities for private investments in energy efficiency to mobilize and deploy adequate and effective financial resources to achieve a low-carbon, climate-resilient development.

  • EEFIG Underwriting Toolkit – Value and Risk Appraisal For Energy Efficiency Financing

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    Each year, governments, financial institutions, companies and consumers around the world are investing more than USD 221 billion into capital expenditure in buildings, industry and transport, to improve energy efficiency. For G20 countries, who are responsible for over 80% of primary energy consumption and 80% of green house gas emissions globally, energy efficiency and improved […]

  • Energy Efficiency and the Finance Sector

    Provides an evidence base on the status quo, the barriers and possible ways forward in the field of energy efficiency finance. (Executive Summary)
    Chinese version summary