Lab Instrument Analysis: Energy Savings Insurance

The report examines Energy Savings Insurance (ESI), an instrument developed by the Inter-American Development Bank and BASE to unlock energy efficiency investments for SMEs by insuring against the risk that projected energy savings are not met. ESI can absorb up to 80% of underperformance risk and is being piloted or replicated across several countries, including Mexico, Colombia, and El Salvador. If scaled globally, the instrument is estimated to drive USD 10-100 billion in investment and reduce annual emissions by 27-234 MtCO2 by 2030.

• Energy Savings Insurance (ESI) addresses investment barriers for small and medium-sized businesses (SMEs) by insuring the financial performance of energy efficiency projects and can absorb up to 80% of the risk associated with underperformance.
• If implemented across all relevant developing countries, ESI has the potential to generate between USD 10 billion and USD 100 billion in investment and achieve annual emissions reductions of 27 to 234 MtCO2 by 2030.
• The ESI model is being deployed through various national pilots: Mexico targets USD 25 million in investment for 190 agro-industry projects through 2020; Colombia targets 104 firms in healthcare to reduce 13,977 tCO2e/year; and El Salvador targets 500 firms to reduce 37,500 tCO2e/year.
• The instrument consists of insurance purchased by technology solution providers to back contractual guarantees, combined with complementary measures including standardized contracts, third-party verification, development bank credit lines, and grant support.

APA

Climate Policy Initiative (2015). Lab Instrument Analysis: Energy Savings Insurance. https://www.climatepolicyinitiative.org/publication/lab-instrument-analysis-energy-savings-insurance/

Chicago

Climate Policy Initiative. Lab Instrument Analysis: Energy Savings Insurance. 2015. https://www.climatepolicyinitiative.org/publication/lab-instrument-analysis-energy-savings-insurance/.

Wikipedia

{{cite report |author=Climate Policy Initiative |title=Lab Instrument Analysis: Energy Savings Insurance |date=22 April 2015 |url=https://www.climatepolicyinitiative.org/publication/lab-instrument-analysis-energy-savings-insurance/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{climatepolicyinitiative2015lab, author = {{Climate Policy Initiative}}, title = {{Lab Instrument Analysis: Energy Savings Insurance}}, institution = {Climate Policy Initiative}, year = {2015}, month = apr, url = {https://www.climatepolicyinitiative.org/publication/lab-instrument-analysis-energy-savings-insurance/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }