Partial Risk Guarantee Fund for Energy Efficiency (PRGFEE)
The PRGFEE is a risk sharing mechanism to provide Participating Financial Institutions (PFIs) with a partial coverage of risk involved in extending loans for energy efficiency projects and directly support financing of Energy Efficiency (EE) projects by: Addressing the credit risks and barriers to structuring the transactionsEngaging financial institutions and building their capacity to finance EE projects on a commercially sustainable basis. Key features of PRGFEE:Guarantee Period: Up to a maximum of 5 years. Maximum Guarantee coverage: Up to 50% of the sanctioned loan amount to a maximum of INR 10 crore per project, whichever is less. Application fee: 0.1% of the maximum guaranteed amount at the time of application and is non-refundable. One-time Guarantee Fee: 1% of the amount guaranteed if the borrower is a male entrepreneur and 0.5% if the borrower is a female entrepreneur, payable after approval and before signing of the Guarantee Agreement. Loan amount of up to a minimum of INR 5 Lakh can be considered for guarantee under PRGFEE. In case of default, fund will:Cover the first loss subject to a maximum of 10% of the guaranteed amount. Cover the remaining default (outstanding principal) amount on pari-passu basis up to the maximum guaranteed amount. Financial institutions need to be enlisted by the BEE to participate in PRGFEE.Projects implementedby BEE's enlisted ESCOs or a Joint Venture of ESCOs with at least 50% share capital of BEE's enlisted ESCO, will only be covered under PRGFEE.Guarantee coverage to be provided before disbursement of loan by PFI to ESCO.
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