Energy Savings Insurance: Pilot Progress, Lessons Learned, and Replication Plan

The report details the design and pilot of the Energy Savings Insurance (ESI) instrument, aimed at stimulating energy efficiency investments for small and medium enterprises (SMEs) by mitigating the risk of underperformance. It focuses on a 2015 pilot in Mexico's agro-industry sector and outlines a replication strategy for Latin America, the Caribbean, Asia, and Africa.

• The Energy Savings Insurance (ESI) instrument is designed to encourage energy efficiency investments by SMEs by reducing the risk that projects will not pay for themselves if actual energy savings are lower than projected.
• In Mexico, the ESI pilot initially targets 10 fast-track projects in the agro-business sector with an estimated total value of USD 2.14 million. The broader target for the pilot is to stimulate 190 projects, potentially mobilizing USD 25 million in investments by 2020.
• Financial modeling indicates that the ESI package, including loans and performance fees, can absorb 60% to 80% of the impact of energy savings underperformance during the payback period, which protects both equity investors and debt holders.
• The Mexico pilot utilizes a specific financial structure where FIRA provides credit lines covering up to 80% of upfront costs with tenors up to eight years. The insurance takes the form of a surety with a one-time premium of approximately 1-3% of the insured value, paid by the technology provider.
• The replication plan for Latin America and the Caribbean (LAC) involves a proposed regional facility targeting six to seven countries and sectors starting in 2016, with USD 5 million in core funding from the Danish government and a potential additional USD 16.9 million in donor grants to expand to seven more countries.
• Beyond Latin America, the program identifies substantial market potential for replication in Asia (specifically China, India, and Indonesia) and Africa (including South Africa, Senegal, and Tunisia), estimating that USD 13.9 million in grants would be needed to extend the program to seven additional countries or sectors in one of these regions.
• The global potential for the ESI instrument is estimated to drive USD 10-100 billion in investments and achieve annual emission reductions of 27-234 MtCO2 by 2030.

APA

Micale, V., Stadelmann, M., & Boni, L. (2015). Energy Savings Insurance: Pilot Progress, Lessons Learned, and Replication Plan. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2015/04/Energy-Savings-Insurance-Lab-Phase-3-Analysis-Summary.pdf

Chicago

Micale, Valerio, Martin Stadelmann, and Leonardo Boni. Energy Savings Insurance: Pilot Progress, Lessons Learned, and Replication Plan. Climate Policy Initiative, 2015. https://www.climatepolicyinitiative.org/wp-content/uploads/2015/04/Energy-Savings-Insurance-Lab-Phase-3-Analysis-Summary.pdf.

Wikipedia

{{cite report |last1=Micale |first1=Valerio |last2=Stadelmann |first2=Martin |last3=Boni |first3=Leonardo |title=Energy Savings Insurance: Pilot Progress, Lessons Learned, and Replication Plan |publisher=Climate Policy Initiative |date=April 2015 |url=https://www.climatepolicyinitiative.org/wp-content/uploads/2015/04/Energy-Savings-Insurance-Lab-Phase-3-Analysis-Summary.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{micale2015energy, author = {Micale, Valerio and Stadelmann, Martin and Boni, Leonardo}, title = {{Energy Savings Insurance: Pilot Progress, Lessons Learned, and Replication Plan}}, institution = {Climate Policy Initiative}, year = {2015}, month = apr, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2015/04/Energy-Savings-Insurance-Lab-Phase-3-Analysis-Summary.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }