The objective of the Partial Risk Sharing Facility for Energy Efficiency (PRSF) Project is to assist India in achieving energy savings with mobilization of commercial finance and participation of energy service companies. This project consists of two components. The first component supports establishing and operating the Facility to provide Sub-Guarantees to Sub-Financiers and developing energy efficiency markets through end-to-end solutions and measurement and verification (M&V) activities.

The partial risk sharing facility for energy efficiency is managed by Small Industries Development Bank of India (SIDBI), funded from a Global Environment Facility (GEF) contribution and backstopped by a Clean Technology Fund (CTF) Guarantee, in the form of contingent finance. Component two supports technical assistance, capacity building, and operations support comprising, among other things, the following activities: i. Carrying out market development, Project management, awareness building, and outreach to beneficiaries and stakeholders. ii. Undertaking legal due diligence and dispute resolution involving Sub-Projects. iii. Developing and maintaining the Facility’s website and online presence; a management information system; and other reporting systems. iv. Developing standard appraisal and transaction documents, reporting templates, energy efficient guidelines, strengthening Project report generation, capacity building and training, and online support. v. Providing technical assistance and capacity building for Participating Financial Institutions, Energy Service Companies, and Beneficiaries.

The Partial Risk Sharing Facility will be available for supporting EE loans made by SIDBI and by participating financial institutions (PFIs) that will be empanelled and sign an Agreement with the PEA as part of this project. A guarantee fee, at a pre-determined rate, will be charged for each EE sub-project supported under PRSF. While the guarantee window for SIDBI loans, to be maintained as a sub-account, will have an initial corpus of US$6 million of GEF grant for risk coverage, the window for guarantee calls from PFIs (excluding SIDBI), in the second sub-account, will also have an initial corpus of US$6 million GEF grant for risk coverage and will in addition be backstopped by additional risk coverage through CTF guarantee of US$25 million (contingent finance).

To be eligible for credit guarantees from PRSF, PFI loans will have to be for EE projects that are implemented by ESCOs. For projects to be eligible, the implementing ESCO will have to have an energy savings performance contract (ESPC) with the beneficiary host entity. Further, PFIs will submit the information in the standard templates as specified from time to time.

Project Components

The PRSF project will consist of a risk sharing facility for energy efficiency, managed by SIDBI, of US$37 million, funded from a Global Environmental Facility (GEF) contribution of US$12 million and backstopped by a Clean Technology Fund (CTF) Guarantee, in the form of contingent finance, of US$25 million, and a technical assistance component.

How PRSF Works

Financial Institutions :SIDBI, YES Bank, Corporation Bank, Tata Cleantech, Electronical Finance.