Pristina, 3 October 2019 – “This is a decisive step towards better financing for renewable energy in Kosovo and a chance for our country to build expertise in project finance, which will unlock new capital across a variety of sectors” – says Petrit Selimi, CEO of Millennium Foundation Kosovo (MFK).

The Millennium Foundation Kosovo, supported by the U.S. Millennium Challenge Corporation (MCC), has signed an Implementing Entity Agreement with the Kosovo Credit Guarantee Fund (KCGF), Kosovo’s foremost guarantee vehicle to support access to finance for the private sector. This agreement formalizes collaboration between the two organizations to build expertise and open a Project Lending and Renewable Energy Guarantee Window.

To enhance KCGF’s project financing skills and open this new window, MFK will fund costs needed to oversee KCGF’s operations and increase project financing skills. “This is an exciting development to help Kosovo’s economy. KCGF has successfully unlocked millions of euros of credit guarantees for SMEs and we seek to diversify our portfolio in the private sector, by working both in renewable energy project financing and project financing,” – says Besnik Berisha, Managing Director of Kosovo Credit Guarantee Fund.

MFK – in consultation with KCGF, the Government of Kosovo, and the donor community – will focus on three complementary interventions to increase solar energy financing in Kosovo:

1. Providing technical assistance and capacity building to establish a renewable energy guarantee window in project financing

2. Launching a project accelerator focused on qualitative project screening and development of bankable projects by independent power producers

3. Standardizing the market through a toolkit for training and project standardization to help KCGF partner banks assess risk factors when evaluating solar generation projects

MFK, through MCC funded due diligence, spent two years engaging stakeholders and analyzing the role guarantees could play in unlocking commercial financing for small-scale Renewable Energy Independent Power Producers. This research examined the challenges of providing project finance to power producers through local and regional commercial banks. Findings from this analysis informed the Kosovo Renewable Energy Independent Power Producer and Commercial Finance Facilitation Project.

Part of this project involves building the capacity of KCGF to serve as a key catalyst within Kosovo. Alexander Dixon, Managing Director of Finance, Investment, and Trade at MCC, stated, “MFK and KCGF’s collaboration is part of MCC’s focus on leveraging blended finance to unlock private capital. This partnership is expected to catalyze the development of the Kosovo burgeoning renewable energy sector and KCGF will play a key role in attracting private and DFI capital. MCC is happy to build upon the legacy of historical US government efforts in the banking sector”. Through this collaboration, KCGF will unlock commercial financing for small-scale renewable energy generation in collaboration with their consortium partners.