Environmental Review Summary
Project Number
506996
Company Name
INTERNATIONAL FINANCE CORPORATION
Date ERS Disclosed
May 1, 2002
Country
World Region
Region
Global
Date Revised ERS Disclosed
May 1, 2002
Environmental Category
B - Limited
Status
Pending Approval
Sector
Other (For Non-Investment Projects)
Industry
Infrastructure
Department
Risk Mgmt. and Financial Policy
Project Description
IFC has a strong interest in supporting private sector investments that generate direct environmental benefits. These types of projects include environmental infrastructure services (e.g., clean water supply and wastewater treatment), pollution abatement services, sustainable technologies and business models (e.g., renewable energy, low-impact agriculture, eco-tourism), and ‘eco-efficiency’ improvements that reduce material and energy inputs. Investments in commercially viable projects in these and other environmental sectors clearly contribute to IFC’s mission of supporting sustainable development.
However, a number of projects that show promise in terms of environmental benefits and commercial potential do not yet meet IFC’s mainstream investment criteria because they involve higher-than-acceptable costs and/or risks. These ventures hold out the prospect for increased environmental sustainability but must overcome the uncertainty associated with new markets, new technologies and new ways of doing business.
To support these types of projects, IFC proposes to establish the Environmental Opportunities Facility (EOF). The EOF will provide catalytic project development funding and flexible investment financing for innovative projects that address primarily local environmental issues. Potential projects will be selected using criteria that emphasize environmental and commercial sustainability, the need for concessional funding, and factors critical to successful implementation. EOF projects will be pursued in a manner that clearly acknowledges the higher risks and designs appropriate interventions. In this way, the EOF will give IFC the ability to ‘push the market’ towards adopting new business models and technologies that protect the environment.
The EOF will be managed by the Environmental Markets Group of IFC’s Environment and Social Development Department. Funding for the EOF will be provided by IFC as well as external donors. The EOF will operate for an initial period of five years.
However, a number of projects that show promise in terms of environmental benefits and commercial potential do not yet meet IFC’s mainstream investment criteria because they involve higher-than-acceptable costs and/or risks. These ventures hold out the prospect for increased environmental sustainability but must overcome the uncertainty associated with new markets, new technologies and new ways of doing business.
To support these types of projects, IFC proposes to establish the Environmental Opportunities Facility (EOF). The EOF will provide catalytic project development funding and flexible investment financing for innovative projects that address primarily local environmental issues. Potential projects will be selected using criteria that emphasize environmental and commercial sustainability, the need for concessional funding, and factors critical to successful implementation. EOF projects will be pursued in a manner that clearly acknowledges the higher risks and designs appropriate interventions. In this way, the EOF will give IFC the ability to ‘push the market’ towards adopting new business models and technologies that protect the environment.
The EOF will be managed by the Environmental Markets Group of IFC’s Environment and Social Development Department. Funding for the EOF will be provided by IFC as well as external donors. The EOF will operate for an initial period of five years.
Environmental and Social
Conclusion & Monitoring
Related SPI
