EIF spends N$14m on Green Technologies
The Environmental Investment Fund (EIF) has so far spent N$14 million on advancing green technologies.
The funds were spent on financing the Green Concessional Loan Scheme, an initiative started in 2013 and signed between the EIF and the Small and Medium-Sized Enterprises’ (SME) Bank.
It is expected to provide an estimated initial 2000 Namibian households with access to financing for green technologies.
Through the SME Bank, the loans enable households affordable access to renewable energy technologies.
It largely aims to provide incentives for businesses to reduce the impact of their operations on the environment by adopting eco-friendly practices.
It was also meant to target customers at household level, where borrowers would be able to receive up to N$100,000 in financing, repayable within a maximum period of five years at an interest rate of up to 4.25%.
EIF’s Head of Communications and Corporate Affairs, Lazarus Nafidi, told The Villager that the loans range between N$900,000 and N$4 million per loan.
However, the demand for green initiatives has grown exponentially, with the EIF receiving more than 40 competitive business plans across all areas of natural resources management, green technology and tourism development.
“Green Concessional Loans is an innovative financial product whose importance has been driven by a market demand for technologies which promote the adoption of renewable energy sources, and the efficient use of non-renewable sources and finite natural resources such as water,” Nafidi explained.
He said since Namibia is traditionally heavily- dependent on its primary natural resources for development, the loans are earmarked for developing green enterprises whose operations have minimal impacts on the environment, and in essence target all sectors of production.
Companies planning to make their operations green are encouraged to approach the fund for financing. Nafidi emphasized that the Green Concessional Loans also targets entrepreneurs and start-ups in tourism, renewable energy, waste management and value-addition on both natural resources and waste.
“While the terms of the loans feature exciting items such as a below-market interest rate, a generous grace period and long repayment periods, we exercise financial prudence by ensuring that the loans’ evaluation process takes into account the applicant’s ability to repay the loan.”
Nafidi continued, “Depending on the applicant’s risk profile, we offer an interest rate of up to prime minus 4.25% on the loans, a grace period of up to 12 months and repayment periods of up to 10 years.”
Although the focus of traditional financing institutions is firmly on the return on investments, the Fund measures the performance of the loan in terms of its impact on environmental sustainability.
For instance, the Fund looks at the contribution of the projects in the area of land under protection, volumes of waste recycled or amounts of clean energy produced.
Nafidi mentioned some of the highlights of the projects currently financed under the EIF Green Concessional Loans include the 32,000 hectares of pristine protected area covered, the production of organic animal feeds through the hydroponic method and saving both water and land use by 97%, as compared to conventional production methods.
“This also represents effective natural resources’ practices and up to 40% reduction in feed cost by the farmers during droughts, presenting an effective climate adaptation method,” Nafidi continued.
Other projects are the 3000 tons of organic fertiliser produced annually without using harmful chemicals at Greenfield Organic Fertilizer Namibia, and up to 500 tons of waste wood recycled annually through the Waste-to-Furniture project administered by Benz Woodwork.
To date, the EIF has invested N$32 million through its investment products; N$12 million in grants; Green Concessional Loans receiving N$14 million and N$5 million in Green soft loans.