Loan to SB Modernizavimo Fondas in Lithuania to improve energy efficiency of residential buildings
25 April 2022
Vilnius – The Council of Europe Development Bank (CEB) and Lithuania’s SB Modernizavimo Fondas today signed a €40 million loan to finance the improvement of energy efficiency in residential buildings.
In April 2020, the Lithuanian Ministry of Finance and the Ministry of Environment selected Šiaulių Bankas to establish an investment platform to leverage European Union funds and attract financing from banks and other financial institutions to renovate at least 800 multi-apartment buildings for more than 25,000 households by the end of 2025.
In a competitive process, Šiaulių Bankas accepted CEB’s binding offer of €40 million that will have direct impact on 130 sub-projects for more than 4,200 households.
Other banks participating in this complex financing structure include the European Investment Bank (EIB) with a €90 million loan, the Nordic Investment Bank (NIB) with €50 million, and Swedbank with €40.625 million. The overall estimated funding for this project is €275 million.
“Supporting environmentally sustainable projects is one of our strategic priorities,” said CEB Governor Carlo Monticelli. “We are pleased to support Šiaulių Bankas and the Lithuanian authorities in their aim to improve living conditions for a large number of citizens and to promote responsible energy consumption.”
In Lithuania, 90% of approximately 39,000 multi-apartment buildings were constructed according to outdated technical standards valid before 1993. They are characterized by low thermal resistance, outdated and inefficient one-pipe heating systems, and lack of proper ventilation. Their annual heat consumption is twice as high as in residential buildings built after 1993.
The CEB loan will help reduce energy consumption, heating costs and environmental pollution, in line with Lithuania’s Multi-Apartment Buildings Renovation Programme and the European Green Deal.
Financed sub-projects may include insulation work on façades and roofs, replacement of windows, and renovation of heating systems. Renovations are expected to decrease the heating bills considerably and the gains will be used to cover a large portion of the loan payment.
Lithuania joined the CEB in January 1996. It has received funds from the Bank in the fields of energy efficiency, emergency healthcare, education for all, sustainable mobility, upgrade of essential water and wastewater services, migrant and refugee integration, and social housing. More information is available here.
Set up in 1956, the CEB (Council of Europe Development Bank) has 42 member states. Twenty-two Central, Eastern and South Eastern European countries, forming the Bank's target countries, are listed among the member states. As a major instrument of the policy of solidarity in Europe, the Bank finances social projects by making available resources raised in conditions reflecting the quality of its rating (Aa1 with Moody's, outlook stable, AAA with Standard & Poor's, outlook stable, AA+ with Fitch Ratings, outlook positive and AAA* with Scope Ratings, outlook stable). It thus grants loans to its member states, and to financial institutions and local authorities in its member states for the financing of projects in the social sector, in accordance with its Articles of Agreement.