Georgia is establishing a Renewable Energy Revolving Fund (RERF) to assist in implementing the UN Framework Convention to Combat Climate Change (UNFCCC). In particular, the RERF will provide loans to private and municipal operators of existing small-scale hydropower plants and geothermal facilities. Other institutions wishing to promote the development of renewable energies in Georgia will also have access to the RERF.
The RERF will be established in the framework of a UNDP/GEF – KfW project to 
promote the use of renewable energy in local energy supplies (see “Technology Transfer to Build Capacity and Implement Climate MEAs in Georgia” following Guideline 33
). Euros5.112 million from KfW and US$2 million from GEF will provide the initial capital for the fund.
The RERF will be managed by a Fund Manager that is selected through a public tender. The requirements for the Fund Manager are that it be an independent, qualified accounting firm with an international reputation. The specific tasks of the Manager will be agreed upon by KfW, the Ministry of Environment and Natural Resources, and the Ministry of Energy.
The RERF will lend resources to the Financial Intermediate of the project, a local bank selected through public tender, at an interest rate of 3%. The local bank, in turn, will on-lend to the owners of small hydropower plants and geothermal pilot project at an interest rate of 5%, over a note period of 7 years. The local bank will be responsible for loan repayment. It is expected that the programme bank will be selected by the end of 2004, and a credit line opened and the first loans issued by the end of 2005.
For more information, contact Mrs. Nino Gokhelashvili at gmep@access.sanet.ge.