Recommendations on how European Development Finance Institutions and Export Credit Agencies can support the European solar value chain
Role of European DFIs and ECAs in supporting the European solar value chain. ECA-DFI enhanced coordination.
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Development Finance Institutions (DFIs) and Export Credit Agencies (ECAs) can provide much needed support and a powerful, aggregated financial toolkit that can boost the competitiveness of European companies looking to do business in global markets.
There are several different categories of company that could benefit from this enhanced coordination, including those focused on the deployment of renewable energies (project developers), those producing and selling components for solar systems (module, inverter and Bill of Substances (BOS) manufacturers), and those providing the machines, equipment and industrial know-how required to manufacturer components (equipment providers).
This paper explores DFIs’ and ECAs’ contributions, and proposes improved cooperation to boost European businesses in international markets.
Our recommendations include:
The role of European DFIs in supporting the European solar value chain
- Global Gateway’s guarantee framework should be further developed and strengthened to ensure adequate risk coverage for renewable energy projects.
- Global Gateway should look to provide guarantees, grant funding, or concessional loans to manufacturing projects involving European equipment providers in emerging markets.
- DFI mandates should be updated to include resilience award criteria in public and private procurement processes supported by European DFIs.
- Concrete pilot projects should be initiated for European DFIs to support solar manufacturing projects in third countries built with technology from European equipment providers.
The role of European ECAs in supporting the European solar value chain
- ECAs should adopt a more pragmatic EU content approach that replaces the current national content award system that they use.
- An EU-level clearing house should be established for ECA applications to streamline and harmonise processes.
- ECAs should be more effectively incorporated into the Team Europe approach to ensure their potential for contributing to Global Gateway flagship project pipelines is fully realised.
ECA-DFI enhanced coordination
- A closer alignment of mandates between DFIs and ECAs should be established when it comes to their roles in supporting EU international partnerships objectives.
- The ECA-DFI enhanced coordination group should focus on mapping and identifying gaps in European development cooperation financing tools and optimising complementarity between ECA and DFI instruments, as well as national and EU-level instruments.
- ECA-DFI enhanced coordination should also focus on creating off-the-shelf products that allow companies to leverage an effective, combined financial offer.
- Concrete pilot projects should be mandated to test ECA-DFI cooperation.
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