European Investment Bank Financing of European Research, Development and Innovation (RDI)

Transcription

1 European Investment Bank Financing of European Research, Development and Innovation (RDI) SET Plan Financing Workshop June 20-21, 2011 Brussels Structured Finance & Advisory European Investment Bank

2 European Investment Bank Disclaimer This Presentation is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefing provided by the European Investment Bank ( EIB ). The terms and conditions are intended as an outline for discussion purposes only and made on an indicative basis. All figures set forth in this Presentation are subject to change, to a satisfactory due diligence and to all necessary internal approvals of EIB (in particular of its credit committees). The information in this Presentation reflects the prevailing conditions and the view of EIB as of this date and are accordingly subject to change and based on carefully selected sources believed to be reliable. EIB has not independently verified this information and does not make any representation or will be liable that such information is accurate, valid, timely and complete. This Presentation is provided without any liability whatsoever by EIB and shall not constitute any obligation of EIB to extend credit facilities to the Company or to carry out a due diligence review of the aspects relevant for the financing of the Project. Neither this presentation nor any of its contents may be duplicated, published or used for any other purposes without the prior written consent of EIB. European Investment Bank Structured Finance & Advisory European Investment Bank 2

3 European Investment Bank Profile The European Investment Bank is the European Union s long-term financing institution. The Bank acts as an autonomous body set up to finance capital investments furthering European integration by promoting EU policies. EIB was created by the Treaty of Rome in 1958 EIB is a not-for-profit, policy driven institution EIB is 100% owned by the 27 EU member states EIB subscribed capital was EUR 232.4bn as of 2010 EIB is AAA/Aaa rated by Moody s, S&P and Fitch with stable outlook EIB funds itself on the capital markets: EUR 67.0bn in 2010 EIB signed loans amounting to EUR 72bn in 2010 (c.90% in EU) EIB is the largest multilateral financing institution Total portfolio of loans EUR 451bn as of 2010 EIB is the majority shareholder in the European Investment Fund For more information, please visit: Structured Finance & Advisory European Investment Bank 3

4 European Investment Bank Policy Objectives and Lending Statistics for 2010 Policy Objectives within the European Union: Cohesion and convergence Small and medium-sized enterprises (SMEs) Environmental sustainability Knowledge Economy Trans-European Networks (TENs) Sustainable, competitive and secure energy SET Plan links to all objectives Lending Statistics 2010: Convergence: EUR 29.3bn Knowledge Economy: EUR 16.5bn Trans-European Networks (TENs): EUR 10bn Small and Medium Enterprises: EUR 10.8bn Environmental protection and sustainable communities: EUR 28.7bn Sustainable, competitive and secure energy: EUR 14.8bn Structured Finance & Advisory European Investment Bank 4

5 EIB Contribution to EU Policy Objectives in the field of Energy and Climate Change EIB contribution to energy & climate change focuses on six priority areas: renewable energy energy efficiency research, development and innovation (RDI) in energy security and diversification of supply trans-european energy networks (TEN-E) carbon financing Structured Finance & Advisory European Investment Bank 5

6 EIB Group Product Offer Risk Capital CIP Resources (SME) RSFF (SME / MidCap) Investment Loans Facility: High Growth Innovative SME Scheme (GIF), Ecotech Purpose: IP financing, technology transfer, seed financing, investment readiness Target Group: VC Funds, Business Angels EIF Product: Fund-of- Funds Competitivness and Innovation Program (CIP) Guarantee schemes Growth financing for SMEs Formal VC Funds, CLOs SME guarantees (loans, microcredit, equity/mezzanine, securitisation) RSFF, RSI (RSFF for SMEs; new product in development) Innovation financing SMEs/MidCaps, Banks, PE Investors (subinvestment grade) Loans (incl. Mezzanine), Funded Risk Sharing Facilities with Banks Special Operations Investment Loans RDI financing MidCaps/Large Corporates/Public Sector Entities (investment grade) Guarantees Special Operations Bank Loans and Guarantees Formal VC Funds Seed/Early Stage VC Funds Business Angels Entrepreneur, friends, family EIF EIB Seed / Start-Up Phase Emerging Growth Phase Development Phase Later Stage Counterparts Structured Finance & Advisory European Investment Bank 6

7 EIB Instruments for SET Plan projects in addition to standard (inv grade quality) EIB loans Structured Finance Facility (SFF) and Risk Sharing Finance Facility (RSFF): to fund projects with a higher risk profile and enable equity financing; mezzanine and guarantee operations for infrastructure schemes Investments in Equity Funds: EIB invests in equity funds, e.g. Marguerite, which in turn take direct equity participations in infrastructure investments NER300: Joint Action Programme with the European Commission to provide grants to Low Carbon and Renewable projects under the Revised Emissions Trading Directive. Implementing first calls from European PPP Expertise Centre (EPEC): Expertise service provided by the EIB and European Commission to support programme and policy development as well as best practice by the public sector for PPP transactions. Joint Assistance to Support Projects in the European Regions (JASPERS): a joint policy initiative of EIB, DG REGIO, EBRD and KfW to provide assistance for absorption of Structural & Cohesion Funds period 2007 to 2013 Structured Finance & Advisory European Investment Bank 7

8 European Investment Bank Financing Models and Concepts Corporates Project Finance Public Sector Other The project is defined and EIB is financing up to 50% of the eligible project costs but on the balance sheet of the promoter, i.e. the ability of the company as a whole to service debt is the main driving factor in the process along with the proposed structure of the facility. EIB also finances corporates indirectly usually via third-party financing institutions (non- RSFF). The project is structured as a ring-fenced operation with limited or no recourse to the promoters. The quality of the assets and their ability to generate cash are vital for such type of operations. PF operations could be fullrisk (RSFF), or guaranteed (banks, corporates monolines, governments), secured, PPPs Project may be supported indirectly via EIB facilities extended to member states and local governments Infrastructure funds Advisory services Other initiatives Structured Finance & Advisory European Investment Bank 8

9 Direct RDI Financing - The Risk Sharing Finance Facility (RSFF) EIB has prioritised investment in research, development and innovation (RDI) as it is one of the key factors necessary to improve competitiveness and ensure longterm economic growth and employment in Europe. Investment in RDI is a key EU priority, as Europe has set the medium-term goal of becoming the most competitive and dynamic knowledge-based economy in the world. RSFF provides substantial additional debt finance to complement more conventional sources of finance such as grants, equity and loans, to finance high value-added high-risk investments covering the full range of RDI, and is available in EU-27 + FP7 associated countries. RSFF is being implemented in cooperation between the European Commission and the EIB, each of which have provided EUR 1bn capital each to cover the risks borne by the EIB when financing RDI projects under RSFF for the period RSFF has shown excellent results to date and by the end of 2010, 3.5 years since RSFF was launched, loans worth almost EUR 8.8bn, (88% of the total RSFF facility) will have been approved and loans of almost EUR 6.3bn (63% of total) will have been signed. Structured Finance & Advisory European Investment Bank 9

10 Direct RDI Financing - Risk Sharing Finance Facility (RSFF) Own Resources EIB RSFF funds is a debt based instrument to complement other sources of debt funds available for low/sub investment grade RDI intensive corporates and project finance transactions EUR 1bn EUR 1bn EIB RSFF funds are highly attractive for potential beneficiaries because of: Banks EIB (RSFF) Approx. EUR 10bn Debt Financing Investors Final Beneficiaries Low/Sub Investment Grade (BBB- and below) 1. Highly attractive terms & conditions (AAA rating and non-for-profit pricing) 2. Long maturities of up to 10 years or more 3. Direct EIB participation of up to EUR 300m per transaction (depending on rating) 4. Strong technology/industry expertise 5. EIB does not sell assets on the secondary market (buy and hold strategy) 6. No cross selling (just long-term lender) 7. Signalling Effect: EIB as a quality stamp 8. Debt and Mezzanine Debt Product Structured Finance & Advisory European Investment Bank 10

11 European Investment Bank New Financial Instruments Demand Driven 1. Responding to EC 2020 Objectives Growth: Smart Sustainable Inclusive 3. Simple to Implement and Monitor 5. Optimise EIB Capital Allocation 4. Leverage EC Funds Structured Finance & Advisory European Investment Bank 11

12 European Investment Bank Financing Models and Concepts: Potential new instruments / initiatives relevant for SET-plan financing: Enhanced Risk Sharing Finance Facility (RSFF) Maturity Enhancement product European Project Bonds Initiative Infrastructure Funds (Marguerite fund, Infrastructure/energy fund-of-funds) Continuation of existing Technical Assistance and Advisory e.g. JASPERS (Joint Assistance to Support Projects in the European Regions), JESSICA (urban), EPEC (PPPs), JEREMIE (SMEs), JASMINE (Microfinance), ELENA (Energy Efficiency) Structured Finance & Advisory European Investment Bank 12

13 For more information Chris Knowles Associate Director Climate Change and Advisory Phone: (+352) Fax: (+352) European Investment Bank 100, boulevard Konrad Adenauer L-2950 Luxembourg Marc D hooge RSFF Programme Manager Research, Development & Innovation Structured Finance and Advisory Phone: (+352) Fax: (+352) dhooge@eib.org European Investment Bank 100, boulevard Konrad Adenauer L-2950 Luxembourg Nicholas Jennett Head of EPEC European PPP Expertise Centre Direct Dial: Direct Fax: jennett@eib.org European Investment Bank 100, boulevard Konrad Adenauer L-2950 Luxembourg Structured Finance & Advisory European Investment Bank 13

14 Annexes Structured Finance & Advisory European Investment Bank 14

15 EIB Instruments European PPP Expertise Centre European PPP Expertise Centre a collaborative initiative of the EIB, the Commission and EU Member States. EPEC s mission to assist the public sector to address shortcomings in organisational capacity and promote expertise and experience sharing. Good practice guidance is disseminated among EPEC s members with the aim of enhancing public sector management, reducing PPP costs and increasing deal flow. Analysis of the impact of the credit crisis, and the responses of the public sector (guarantee instruments, co-lending facilities, funding competitions and book building) has been the core component of EPEC s work in Structured Finance & Advisory European Investment Bank 15

16 2020 Marguerite Fund Target equity base of 1.5b ; associated Debt Co-financing Initiative of 5b Focus on Greenfield projects within EU-27 in areas of TEN-T; TEN-E and Climate Change (including renewable energy) Major public Core Sponsors: EIB; CDC (France); CDP (Italy); ICO (Spain); KfW (Germany) and PKO (Poland) PPP structure combining long-term private sector, as well as public-sector institutional, investors Access to significant deal flow potential in priority sectors throughout EU Core Sponsors maintain close dialogue with regulatory & public authorities in their home countries and with EU Focus on solid IRR targets; Fund to give preference to projects with satisfactory Economic Rates of Return (ERR) Structured Finance & Advisory European Investment Bank 16

17 EIB Contribution to Financing Energy and Climate Change EIB energy lending: in 2010, 18.1bn ( 14.5bn within EU-27), a 50% increase over 2008 Up to 2009, EIB financed some 5% of the overall wind installed capacity in Europe as well as leading edge investments in concentrated solar power in Spain Projects contributing to Energy Efficiency amounted to 2.3bn in 2010 (13% of EIB lending to energy projects) The RE projects fall into two groups supported by the Bank: mature technologies already used commercially (onshore wind farm, hydropower, geothermal and biomass) emerging technologies in an early implementation phase (photovoltaics, solar thermal and second generation biofuel production technologies) in 2010 EIB lent 6.2bn for RE projects, which is an increase of 35% from 2009 and 33% of EIB s energy financing. Structured Finance & Advisory European Investment Bank 17

18 EIB Contribution to EU Policy - Energy Lending EIB energy lending: In 2010, 18.1bn ( 14.5bn within EU-27), a 50% increase over 2008 During the period bn 100% 80% 60% 40% 20% 0% Renew able Energy Gas/Oil Fields Natural Gas Grids - incl. Storage Regasification & Liquefaction Plants Coal/Lignite Pow er Stations Natural Gas Pow er Stations CHP District Heating Electricity Grids Nucelar Fuel - Processing Other Structured Finance & Advisory European Investment Bank 18

19 EIB 2010 ENERGY LENDING BY OBJECTIVES :18.1 bn EUR 10% 13% ENERGY EFFICIENCY RENEWABLES 30% TEN-E 33% DIVERSIFICATION & SECURITY OF SUPPLY (EU) 14% DIVERSIFICATION & SECURITY OF SUPPLY (OUTSIDE EU) Structured Finance & Advisory European Investment Bank 19

20 2010 EIB ENERGY LENDING BY SECTOR 28% RENEWABLE ENERGY 37% 13% 13% ELECTRICITY GRIDS GAS GRIDS FOSSIL FUEL POWER GENERATION REFINERIES OTHERS 2% 7% Structured Finance & Advisory European Investment Bank 20

21 EIB Contribution to RE Financing EIB has increased considerably its lending to renewable energies EUR 15.8bn 7,000 6,000 5,000 EUR m 4,000 3,000 2,000 1, Alternative and renew - mixed sectors Biomass Hydropower Solar energy manufacturing Wind energy manufacturing Bio fuel manufacturing Geothermal power stations Solar energy Wind energy Structured Finance & Advisory European Investment Bank 21

22 EIB RE & EE Lending in the EU Region* EIB has invested EUR 10bn in the deployment of EU renewable energy (close to 30% of total energy lending) A significant part of this investment (22%) has supported European RE manufacturing industries In addition, EE investments have mounted to EUR 2.2bn in the last two years * Includes EU 27, potential candidates and candidate countries Structured Finance & Advisory European Investment Bank 22

23 EIB Lending to EU* Solar Energy EIB lending has supported Innovative concentrated solar power (CSP) plants in Andalucia, Spain: Solucar Solar Thermal Power, Andasol and Solnova EIB lending has also backed regional RE programmes such as Poitou Charentes photovoltaic regional plan and solar roofs in Germany * Includes EU 27, potential candidates and candidate countries Structured Finance & Advisory European Investment Bank 23

24 EIB Lending to EU* Wind Energy Active in offshore wind since 2002 Belwind (BE): first signed EIB PF project 2010: C-Power, Baltic I, Borkum West Offshore wind involves larger project size than onshore windfarms Offshore wind is still an emerging technology High demand for EIB financing Significant support to EU manufacturers * Includes EU 27, potential candidates and candidate countries Structured Finance & Advisory European Investment Bank 24

25 EIB Financing of Renewable Energy Projects (1) WIND ACCIONA RDI ALTO MINHO PARQUES EOLICOS ANDALUCIA WIND POWER PROJECT BARROW OFFSHORE WINDPOWER BLPC IV WIND POWER BORKUM WEST OFFSHORE WINDPARK C-POWER II OFFSHORE WIND BELGIUM DIF INFRASTRUCTURE FUND II DIF RENEWABLE ENERGY FUND DONG ENERGY POLISH WINDFARMS DONG ENERGY WIND POWER DONG UK RENEWABLES EDA POWER VI EDA POWER VII EDPR - MARGONIN WINDFARMS EOLICAS DE PORTUGAL INDUSTRIA EOLICAS DE PORTUGAL SFF I ESB RENEWABLE PROGRAMME ESPIRITO SANTO INFRASTRUCTURE FUND- I EUFER WIND ENERGY EVELOP BELWIND OFFSHORE WIND FANTANELE WINDFRARM GAMESA WIND POWER RDI GAMESA WIND POWER RDI II IBERDROLA RENEWABLE ENERGY LONDON ARRAY OFFSHORE WINDFARM ORITES WIND FARM OSMANIYE WIND FARM PARQUES EOLICOS GRUPO GENERG SCOTTISH & SOUTHERN RENEWABLES I UK RENEWABLE FINANCING PROGRAM PHASE I UNIFERGIE ENERGIES RENOUVELABLES II VESTAS RDI WINDPOWER TECHNOLOGY SOLAR ABENGOA RDI LOAN ANDASOL SOLAR THERMAL POWER PROJECT ANDASOL SOLAR THERMAL POWER PROJECT II BANCO GUIPUZCOANO PHOTOVOLTAIC GL CEZ PHOTOVOLTAIC POWER INVESTMENTS ENERGY EFFIC & RENEWABLES BARCELONA ESPIRITO SANTO INFRASTRUCTURE FUND- I PHOTOVOLTAIC POWER PLANT BRANDENBURG REGION POITOU-CHARENTES PHOTOVOLTAIQUE SOLAR ROOFS - ALTERNATIVE ENERGY SOLAR SILICON SUPPLY SOLARWAFER SACHSEN II (SFF) SOLARWAFER THUERINGEN SOLNOVA 1 & 3 CONCENTRATED SOLAR POWER SOLUCAR SOLAR THERMAL POWER SUNRAY MONTALTO DI CASTRO PHOTOVOLTAIC THERMOSOLAR GEMASOLAR SPAIN UNIFERGIE ENERGIES RENOUVELABLES II VALENCIA CLIMATE CHANGE ZELIOS - PV PLANTS - FRANCE ITALY GEOTHERMAL EDA POWER VI ENEL ENERGIA RINNOVABILE & AMBIENTE HELLISHEIDI GEOTHERMAL POWER OLKARIA II EXTENSION RE GEOTHERMAL ENERGY Structured Finance & Advisory European Investment Bank 25

26 EIB Financing of Renewable Energy Projects (2) HYDRO AMENAGEMENT HYDROELECTRIQUE DE FELOU BUJAGALI HYDROELECTRIC PROJECT CHINA CLIMATE CHANGE FRAMEWORK LOAN COMPAGNIA VALDOSTANA ENERGIA & AMBIENTE EDA POWER VII EDP REPOWERING ELECTRIC POWER RECONSTRUCTION II ENEL ENERGIA RINNOVABILE & AMBIENTE ENERJISA HYDROPOWER FIJI POWER GILGEL GIBE II HYDROPOWER PLANT IBERDROLA HYDRO SPAIN INGA POWER REHABILITATION JIRAMA ANDEKALEKA HYDRO KEMIJOKI HYDROPOWER II NAM THEUN 2 HYDROELECTRIC PROJECT POWER PLANTS INVESTMENT LOAN ZESCO KARIBA NORTH II BIOMASS & BIOFUELS ABF BIOFUEL PRODUCTION ACCIONA RDI BIOFUEL PLANT POLAND HVC ALKMAAR BIOMASS KUOPIO ENERGIA CHP PORTUCEL ENERGY UNIFERGIE ENERGIES RENOUVELABLES II OTHER RENEWABLES BENELUX POWER GENERATION PROJECT CHINA CLIMATE CHANGE FRAMEWORK LOAN DEXIA RENEWABLE ENERGY EIB KFW VALUE-ADDED CARBON CREDIT FUND ENERCAP POWER FUND ENERGY EFFICIENCY FRAMEWORK LOAN ENVIRONMENT & ENERGY FRAMEWORK LOAN ENVIRONMENT & ENERGY FRAMEWORK LOAN II EREF EUROPEAN RENEWABLE ENERGY FUND I EXIM BANK OF INDIA FRAMEWORK LOAN GREEN ALLIANCE RENEWABLE FUND INGETEAM GREEN ENERGY TECH RDI INTESA LEASING ENERGIA RINNOVABILE LAHTI WASTE-TO-ENERGY PLANT REGIONE LOMBARDIA UBI BANCA ENERGIA RINNOVABILE FL UNIFERGIE ENERGIES RENOUVELABLES Structured Finance & Advisory European Investment Bank 26

27 EIB Participation in Funds Renewables & Carbon Name Total Commitments Sector Focus Country Focus DIF RE 134m Onshore Wind Benelux, F, DE, DK, SE Green Alliance 41m Wind,Solar,Biofuel ES, PT Enercap 98m Onshore Wind CE & SEE ESIF 96m Renewables ES, PT Dasos 85m Forestry CE & L.Am / SE Asia DIF II 220m Renewables & Municipalities North EU Dexia South EU 120m Renewables/Infra ES,PT,F,IT Fondo Italia 120m Health,Transport Italy 2020 Marguerite Target : 1.5bn Infra/Renewables/Energy EU-27 MCCF (IFIs+Private) 190m Carbon Credits NMS & CIS CFE (IFIs) 50m Carbon Credits Global EIB/KFW (IFIs+Private) 100m Carbon Credits Global Post 2012 (IFIs+Private) 125m Carbon Credits Global EIB/KFW II (IFIs+Private) 100m Carbon Credits Global EIB/CDC Fds Carbone Maroc 26m Carbon Credits Morocco Structured Finance & Advisory European Investment Bank 27