Strategic Moves - Regional Environmental Center for Central and ...

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C H A P T E R 7
F I N A N C I N G E N V I R O N M E N TA L I N F R A S T R U C T U R E I N V E S T M E N T S
BOX 19: Case study — Environmental Fund of the Republic of Slovenia
The Environmental Fund of the Republic of Slovenia was established in 1993 in order to manage assets earmarked
for environmental protection. It is the only specialised institution in Slovenia that provides financial assistance to environmental
projects. The fund supports environmental investments in compliance with the priorities defined by the
legislation in force and directs funding to industry, municipalities, local infrastructure companies and households.
The fund is the biggest specialised financial institution granting soft loans; issuing guarantees; providing financial, economic
and technical consulting services; and acting as a financial intermediary. The total capital and liabilities of the
fund were EUR 120 million on December 31, 2007. The largest proportion of funding (70 percent) comes from the
Earmarked Asset Fund, loans from IFIs, and grants from international funds. Earmarked funds come mainly from environmental
taxes, non-refundable funds from the budget of the Ministry of the Environment and Spatial Planning for
environmental investments, and EU funds. The fund has a legal obligation to maintain the real value of its assets and
to cover operating costs from loan interest rates.
For legal entities, funding is directed to support investments in environmental infrastructure, environmentally sound
technologies and products, energy efficiency, energy saving and the use of renewable energy. For households, funding
covers investments assisting conversion from fossil fuels to renewable energy sources and energy-saving technologies,
water consumption reduction, and connections to sewerage systems and small wastewater treatment plants.
Loans to households have significantly increased — from 9 percent in 2002 to 36 percent in 2006.
Opportunities for loans are made public through tenders and public calls for applications. The fund also co-finances
projects with the aim of informing and raising the awareness of potential borrowers about the purposes of the fund’s
favourable loans (Slovenian Environmental Fund Annual Report, 2007). The project evaluation procedure includes assessing
success in meeting the key priorities set in national strategic documents and EU legislation; assessing the adequacy
of technological solutions; and general environmental criteria. Between 1995 and 2006, some 10,031 loans
were granted, worth a total of EUR 239.3 million.
S T R AT E G I C M O V E S
from charges, the EPF is not able to provide a significant amount of money or support
to projects eligible for financing, such as those on environmental protection,
energy efficiency and renewable energy.
General observations
• Public (state, county, municipal etc.) budgets, although insufficient in most
cases, have an essential role in financing the rehabilitation of, and capital investments
in, environmental infrastructure. They indicate priorities and provide
co-financing for loans and grants from the EU, IFIs and bilateral donors.
• The coordination of environmental financing flows at national level is of primary
importance in ensuring complementarities in the financing of environmental
infrastructure and in stimulating cooperation between the relevant ministries.
• SEE countries are slowly increasing the proportion of their environment-related
expenditures and are approaching the levels of new member states. However,
funds are not sufficient to cover all the required expenditures.