The National Energy Efficiency and Renewable Energy Action (NEEREA) is a national financing mechanism that allows private sector entities to get subsidized loans for any type of energy efficiency and renewable energy projects. NEEREA is active through all Lebanese commercial banks under the leadership and management of BDL.

By January 2015, more than 200 projects were approved under the NEEREA financing mechanism with a total amount of more than 250 million USD. NEEREA is the first green financing mechanism in the Arab Region that finances renewable energy, energy efficiency projects and green buildings.

It is a national platform built and launched on 25 November 2010 based on the Circular 236 of the Central Bank of Lebanon, which lists the terms and conditions to get subsidized green loans in collaboration with EU. In 2013, as per circular 313, 318, and lately 346, BDL introduced new incentives to focus on energy efficiency, certified green buildings, and renewable energy.

The technical support and capacity building activities are done by the LCEC to develop the know-how among all players. These activities are part of the contract signed between the BDL and the LCEC under the name "Technical Support Consultancy Services Agreement in Energy Efficiency and Renewable Energy". 

The loan is eligible to private, existing and newly built facilities. It has a ceiling of 10 million USD and is offered at a low interest rate for a maximum of 14 years including a grace period of up to 6 months to 4 years.

The green loans are provided by Lebanese commercial banks to the private sector. The most important aspect of NEEREA is that it links the commercial banks to private companies to ensure a sustainable development of the socio-economic framework.

The European Union contributed to NEEREA by offering a grant over a share of the investment cost of maximum 5 million USD. Most of the grant amounts were disbursed to the Lebanese consumers.

How it works

Clients interested in implementing green energy projects through NEEREA should follow the specific process:

1. Prepare a technical report (as per the reports' templates prepared by the LCEC) either by the client himself or by the appointed energy company including a full feasibility study with full financial and technical analysis. The report should also include the total amount of the requested loan.

2. Pick a commercial bank where the loan is then studied.

a. Based on the Circular No. 545, projects and loan requests not exceeding 20,000 USD do not require the direct approval of BDL; hence, the report will be sent directly by the commercial banks to LCEC.

b. For loan amount exceeding 20,000 USD, the commercial bank first submits the technical report to BDL for approval and BDL, in turn; sends the official report to LCEC for technical verification.

3. The report, once studied by LCEC, is re-sent to the commercial bank or to BDL to review and send the results to the commercial bank.

4. The commercial bank informs the client whether the loan is granted or rejected. If granted, the client can then implement the technical solutions.

This process takes around three months based on the quantity of applications and availability of information. Disciplinary action will be taken if the final execution diverges from the original plans.

NEEREA Results

By June 2020, more than 1,000 projects were approved by the NEEREA financing mechanism with a total amount of more than 600 Million USD. Results show that around 76% of the projects were for solar photovoltaic while 42% of loans amount were for green buildings. These projects all together contribute to an annual saving of 73,253,210 USD. Until today, NEEREA has achieved to reduce yearly energy consumption by 260,163,325 kWh and 281,245 tons of CO2.

The top three sectors involved in NEEREA loans are the Commercial Sector (example: hotels, commercial centers, etc.) with 52%, the Residential Sector with 31%, and the Industrial Sector with 8%. Mount Lebanon governorate acquires the biggest number of projects, whereas Beirut governorate acquires the highest amount of loans as Beirut hosts large scale projects such as the green certified buildings. However, the remaining governorates present an interesting percentage of project which indicates that the NEEREA has reached all the Lebanese territory.

Moreover, the EU grant has been provided to 59 different projects. As such, NEEREA is expanding the Lebanese energy market, helping the Lebanese citizens and protecting the environment.

In addition, NEEREA has helped the national economy by reducing the burden on the Lebanese institutions and industries, as a relatively small yet less amount of energy is imported. It has also created sustainable job opportunities; 76 new energy companies recently entered the energy market with 40% more of job vacancies.