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Feasibility Study and Project Preparation for Emission Reduction Investment (ERI) Program



Feasibility Study and Project Preparation for Emission Reduction Investment (ERI) Program


01.12.2010 – 31.07.2011



Focus of Task:

  1. Review of the performance of existing environmental soft loan programs under the aspects of environmental effects/pollution reduction and economic success (repayment rates) both those managed by KLH as well as others
  2. Review of the concept for the implementation of ERI designed by Mo
  3. Review of the financial risk of financing ERI and how to manage the risk.
  4. Elaboration of a project concept for ERI Project, including:
    • the most appropriate institutional arrangement,
    • mechanism on channeling, and disbursing the funds,
    • selection of on-ending banks
    • development of investment criteria
    • design of a monitoring system
    • scope of work for technical experts providing consulting services,
    • inclusion of a programmatic CDM component
    • Taking into consideration Indonesia’s current economic, banking, environmental and institutional situation.
  5. Compilation of necessary information required for the future preparation on the Indonesian side (e.g. readiness criteria) as well as on the German side (appraisal).
    • Elaboration and implementation of GHG inventories / energy audits
    • Facilitation of voluntarily-signed agreements between companies and the Ministry of Industry
    • Capacity development for energy managers, estate managers and service providers
    • Development of concepts to establish Energy Service Companies (ESCOs)
    • Support the development of climate change relevant incentive schemes
  6. Study on overview of the current emission status in Indonesia based on existing studies and available data is available.
  7. Review and Evaluation of Existing and Forthcoming Environmental Financing Schemes is available.
  8. Identification of high-demand sectors for bankable emission reduction investments and selection of potential fields of investments for the ERI program.
    • Criteria for the selection of potential investments the ERI program has been defined. The criteria include potential impact on GHG-emission reduction, technical and financial feasibility as well as sufficient demand from potential bankable stakeholder.
    • Based on the result of 1) and 2): A preliminary shortlist of recommended potential investments which will be financed under the ERI program has been provided