1. Energy Efficiency in Public and Private Sector Serbia and Western Balkans Belgrade, 15 December 2015

2. The Sustainable Energy Initiative (SEI) 15 December 2015 2  The EBRD has been engaged in sustainable energy finance since its establishment  In 2006, the EBRD launched the SEI to address the twin challenges of energy efficiency and climate change  The EBRD was the first MDB with a dedicated pool of technical experts in-house  In 2009, the EBRD became the first MDB to set itself a carbon emissions target  In mid-2014, the EBRD has already exceeded the three year (2012-14) target under the UN’s Sustainable Energy for All initiative The EBRD’s countries of operations:  high share of heavy industry  ageing infrastructure  high energy intensity  a lack of market-based pricing for energy Therefore EBRD initiated and invested in Sustainable energy: €16.4 billion since 2006

3. SEI Objectives  Scale up energy efficiency and renewable energy investments  Develop financing instruments to support and leverage private sector sustainable energy investment  Improve the business environment for such investments through policy dialogue, regulatory reform and capacity-building  Work closely with donors to address key barriers to energy efficiency, with technical cooperation and investment grants  Mainstream sustainable energy across EBRD sectors of activity including the corporate, financial, municipal and large-scale infrastructure sectors 15 December 2015 3

4. SEI Phase IIISEI Phase IISEI Phase I SEI finance since 2006 15 December 20154 SEI investment since 2006 (€ in billion) SEI by business area (€ in billion) €16.4 billion invested in 926 SEI projects between 2006 and 2014 69.6 m tonnes CO 2 /y of emissions reduced SEI by region (€ in billion) Russia3.2 South-Eastern Europe3.1 Eastern Europe and the Caucasus3.0 Central Europe and the Baltic2.9 Turkey2.1 Central Asia1.0 South and Eastern Mediterranean (SEMED)0.6 Regional0.7 Total16.4 Corporate energy efficiency4.5 Cleaner energy production4.2 Renewable energy 2.9 Sustainable energy financing facilities 2.8 Municipal infrastructure energy efficiency 2.0 Total16.4

5. SEI Serbia At a glance:  36 projects were signed 2006-2014  €636 million total financing committed for energy efficiency and renewable energy  1 million tonnes of CO2 expected to be saved per annum due to the investments 15 December 2015 5

6. The SEI business model 15 December 2015 6 POLICY DIALOGUE PROJECTS AND INVESTMENTS TECHNICAL ASSISTANCE Projects across SEI areas Technical assistance to overcome barriers: market analysis, energy audits, training awareness raising, grant co-financing to provide appropriate incentives and address affordability constraints Working with governments to support development of a strong institutional and regulatory framework that incentivises sustainable energy

7. Example public sector in Western Balkans: EBRD’s Regional Energy Efficiency Programme (REEP) 7 Programmed by the EBRD Supported by the Energy Community Funded by the EU Western Balkans Investment Framework and the Western Balkans Joint Fund Policy dialogue support To create effective legislations for public sector EE EE works & services procurement by preparing procurement law, contract templates and guidelines Transposition of ESCO elements of EU Directives 2006/32/EC and 2012/27/EU General policy dialogue Technical assistance To help local public authorities with procuring EE projects Identification of EE Projects Support municipalities in tender preparation and procurement Financing Credit line through commercial banks (WeBSEFF) Direct financing (WeBSDFF) Direct financing from EBRD for largerprojects Activity area 15 December 2015

8. Financing Western Balkans Sustainable Energy Financing Facility (“WeBSEFF”) I&II, Extension  Regional facility launched in 2008 and extended twice in 2012 and 2014 (€152 million)  Industrial & municipal Energy Efficiency(EE) and Renewable Energy (RE) projects  Supported by technical assistant and grant component for sub-borrowers  Financially intermediated by 18 partner banks in the region (e.g. Serbia 4 partner banks) Western Balkans Sustainable Energy Direct Financing Facility (“WeBSEDFF”)  Regional facility launched in 2008 and extended in 2012 (€100 million)  Portfolio consists of 15 projects financed up to date (estimated saving 442,000 tCO2 equivalent per annum)  Industrial EE projects, RE, ESCO projects in public sector through ESCO contracts  Supported by technical assistant Large direct investments (more than €6 million) EBRD on all of its projects is guided by SEI model where it provides Technical Assistance (for project identification, implementation), Policy Dialogue Support and Financing provides. One of the case studies in Serbia presented on the next slide 15 December 2015 8

9. EBRD support of ESCO market development Legislative support for EE Projects Energy efficiency (EE) Project preparation TC assignments Policy dialogue Street lighting tenders prepared by REEP 9 EE Project preparation Legislative support for EE Projects EE Project preparation Legislative support for EE Projects Ad-hoc EE Project preparation available Legislative support for EE Projects EE Project preparation TC project preparation for ESCO projects: 9 tenders prepared by REEP 11 tenders under preparation by REEP 15 December 2015 ESCO tenders under preparation by REEP Feasibility/scoping studies prepared by REEP

10. Example public sector, Serbia: Bylaw on Energy Performance Contracting enacted in May 2015 EBRD supported preparation of the ESCO bylaw (primarily contract templates for procuring street lighting and building projects) but important partners joined: Led by an initiative of the Dutch ambassadors, the EU delegation, 17 Ambassadors and 7 other major stakeholders signed a letter supporting the timely conclusion of the ESCO bylaw. The Serbian banking community and private sector companies welcome this bylaw since it reflects best international practice protects both public clients and private sector contractors Municipalities should follow the bylaw and use the contract template. Ministries and their agencies and bodies, the PPP- Commission, should support applicants. 15 December 201510 CWC81hQWwAARL-J

11. Thank you! 21 Daniel Berg Director, Serbia Email: bergd@ebrd.combergd@ebrd.com For further enquiries, please contact: www.ebrd.com www.wb-reep.org 15 December 2015