Translated using ChatGPT service.
The Development Finance Institution ALTUM will start accepting applications for the next, 5th round of project selection in the European Union Recovery Fund program on April 2 of this year. This program focuses on energy efficiency, the introduction of renewable energy technologies, and the purchase of electric vehicles. This year, the program has been significantly expanded to include wholesale and retail traders, and all eligible industry companies can now purchase electric vehicles. The application submission period for the open round will last until April 30.
The program provides support in the form of loans with capital rebates and is now available to micro, small, medium, and large enterprises, excluding those in the primary production of agricultural products, fisheries, tobacco product manufacturing, gambling, or transport sectors.
Evaluating the activity of applications in the fourth round, we see that the expansion of the range of supported companies and areas was expected – we have received a total of 89 applications, a significant part of which are for the installation of solar power plants or energy efficiency measures in commercial buildings, which were previously ineligible for the program. We appreciate that entrepreneurs are also planning activities such as the recovery of secondary energy resources from existing processes, such as flue gases or wastewater, as well as the installation of industrial heat pumps, replacement of ventilation systems, and production equipment replacement – activities that can achieve an average of 30-40% primary energy savings and corresponding energy cost savings. I encourage entrepreneurs to use the available support and submit projects for the 5th selection round,” emphasizes Līga Mellēna, head of ALTUM's Corporate Energy Efficiency Department.
The total available funding for 5th round projects is EUR 25.25 million, of which EUR 8.58 million is earmarked for energy efficiency improvements, EUR 15 million for renewable energy technologies, and EUR 1.66 million for zero-emission vehicles.
Amendments approved by the Cabinet of Ministers on February 20 provide several improvements to the range of supported activities. For example, when implementing energy efficiency measures, companies can now invest in green roofs, building equipment digitization, charging infrastructure, equipment, and energy storage for the produced energy. For the introduction of renewable energy (RES) technologies in companies, the range of supported activities has been expanded to include renewable hydrogen production technologies, biofuels, bio-liquids, biomethane, and biomass fuel production technologies, high-efficiency cogeneration technologies, and energy storage equipment for self-consumption.
We remind you that the approach to opening future rounds of the program has changed this year – each project submission phase will last for four weeks, and the next round will open a week after the previous round closes.
Accordingly, the 6th round will open on May 7, and the amount of available funding will depend on the amount reserved in the 5th round. Round results are announced within a month of the closure of each round. New rounds will be opened until the program's funding is exhausted.
In project evaluations, as before, the projects submitted by companies will be compared in the selection process, with the highest points awarded to those that ensure the greatest reduction in greenhouse gas emissions or primary energy savings, calculated per every 1,000 euros of support. Projects eligible for a capital rebate loan will be announced within a month after each round closes.
Support for improving energy efficiency and wider use of renewable energy technologies is available to companies as an ALTUM loan or a parallel loan with a capital rebate for principal repayment.
The maximum loan amount is EUR 5 million with a loan term of up to 15 years. The support is provided as a capital rebate, meaning that ALTUM will reduce the principal amount of the loan after the project is completed and the project goals are achieved. The capital rebate can be requested up to 30% of the project costs, but not more than EUR 1.5 million for a group of related companies.
Electric vehicle support is now available to all sectors that meet the program conditions. With the support, new M1 category vehicles (with no more than eight seats in addition to the driver's seat and no standing passenger space) and N1 category electric vehicles (goods vehicles with a total mass of up to 3.5 tons) can be purchased. The capital rebate is up to 30%, not exceeding EUR 5,000 for one M1 category vehicle and EUR 10,000 for one N1 category vehicle. A group of related companies can apply for support up to a total of EUR 180,000 in this support area. When purchasing an electric vehicle, the entrepreneur will receive a guarantee from ALTUM for financial leasing. After one year of use, achieving the project goal of a mileage of at least 20,000 km, the capital rebate will be applied.
More information about the program is available here: Energy Efficiency Loan with Capital Rebate - bit.ly/3Wrom7j and Electric Vehicle Purchase Guarantee with Capital Rebate - bit.ly/3FH23Vd.
About ALTUM:
The Development Finance Institution ALTUM is a state-owned joint-stock company in Latvia that provides support to specific target groups through financial instruments (loans, guarantees, investments in venture capital funds, etc.) with the help of state-supported financial instruments, supplementing them with non-financial support (consultations, mentoring) within specific programs, as well as implementing other state-delegated functions. In June 2017, ALTUM received a long-term credit rating of Baa1 for a state-owned company from the international credit rating agency Moody's, confirming ALTUM's stable financial situation. On October 24, 2017, ALTUM bonds were included in the regulated market - Nasdaq Riga Baltic Bond List. ALTUM received the Nasdaq Baltic Awards 2019 in the nomination "Stock Exchange Event of the Year in Latvia."