Expert on finance support mechanisms for ESCO market development in Ukraine


Location : Kyiv, UKRAINE
Application Deadline :16-Jun-21 (Midnight New York, USA)
Type of Contract :Individual Contract
Post Level :National Consultant
Languages Required :
English  
Duration of Initial Contract :up to month

UNDP is committed to achieving workforce diversity in terms of gender, nationality and culture. Individuals from minority groups, indigenous groups and persons with disabilities are equally encouraged to apply. All applications will be treated with the strictest confidence.

UNDP does not tolerate sexual exploitation and abuse, any kind of harassment, including sexual harassment, and discrimination. All selected candidates will, therefore, undergo rigorous reference and background checks.


Background

In Ukraine, financial resources in energy efficiency (EE) are gradually shifting from grants to concessional loans and public–private sector partnership initiatives to decrease the burden on public funds. The following types of financial incentives can support the necessary shift in energy efficiency financing: (1) EE funds, (2) dedicated credit-lines, (3) performance contracting systems via energy service companies (ESCOs).

The objective of this Project (EEPB) is to accelerate implementation of energy efficiency measures in public buildings in Ukraine through Energy service company (ESCO) modality by leveraging significant private sector investment over its implementation period (2017 – 2021, with possible extension up to 2023). Among other tasks, The Project is to promote private investment in energy efficiency in public buildings through appropriate catalytic financial incentives, including the establishment of a Financial Support Mechanism (FSM).

 During the first half of implementation, the Project has developed and piloted various financial tools to facilitate overcome this barrier:

  • blank credit for ESCO company using as collateral an EPC contract; 
  • insurance contract with the ESCO company (as risks mitigation measure);
  • factoring instrument between ESCO company and commercial bank (ESCO-factoring) which also includes factual concession of rights for future payments and EPC aims at creation of market of EPC contracts trading;
  • an “Enhanced partnership” ESCO business model that uses a small co-financing from the Project as a mean to offset cost of capital for an ESCO and ensure co-investment in  thermo-modernizations from   municipality.

The Project also explores other options such as leasing instrument, and green bonds as a source of affordable finance for investments.

In this context the EEPB project is seeking an experienced Expert on Finance support mechanisms for ESCO market development in Ukraine to assess the progress in development and operationalizing of affordable options for financing energy efficiency measures in public buildings and provide with recommendations most optimal options with regard to the Projects objectives.

The consultant will promote UNDP’s mandate as a gender-responsive organization with zero tolerance to any kind of discriminatory and abusive behaviour, including sexual harassment, sexual exploitation and abuse.


Duties and Responsibilities

2. OBJECTIVES OF THE ASSIGNMENT

2.1 Stock-take of the project:

  • Assess the effect of recent developments in the finance and business environment in Ukraine on the potential for investments in energy efficiency of municipal public sector; and
  • Assess the range of existing financial mechanisms (FSM) in terms of their additionality, outlining in particular their current status and financial outcomes;
  • Utilizing this information, assess whether the proposed financial instruments, in particular the ESCO modality, are still relevant

2.2 Provide recommendations

  • For options of most realistic ways to further remove barriers for investments in energy efficiency in municipal (public) sector.
  • Project activities to enhance the impact of the project including the provision of technical assistance services to financing scheme applicants, where necessary.

2.3 Support the development of follow-up project proposals for the implementation of EE financing for public buildings.

 

3. DESCRIPTION OF TASKS AND RESPONSIBILITIES

Under the overall supervision of the Project Manager and the guidance of the Chief Technical Advisor Energy Efficiency, the Individual Consultant under this assignment is expected to use available open information as well as professional opinions from partner organizations, including the Ministry of Finance, the National Bank of Ukraine, IFIs, Banking Sector, other financial and insurance markets regulating bodies to:

  • Determine the status of the financial mechanism that was developed under the project, and identify the number and geographical coverage of banks that are implementing it;
  • Determine the number of ESCOs that have applied for loans under the FSM, how many loans were approved, and the total of volume of loans granted;
  • Determine the number of ESCOs -led EPC projects that were supported by the FSM;
  • ESCOs Evaluate feasibility of the various financing schemes and instruments that are being considered;
  • Assess the market impact of the project by reviewing how the project support has enabled investments made by ESCO and other parties in buildings energy efficiency;
  • evaluate financing schemes and instruments, in terms of volume of investments realized and the EE projects that were implemented, including:

3.1 ESCO Models

  • “Enhanced Partnership” ESCO model – in terms of number of co-investments realized in EPC projects;
  •  Municipal ESCO EE fund model – in terms of amount of investments from the city/municipality, and external financing realized in standalone EE and EPC projects;
  • ESCO Factoring FSM – in terms of the number of existing EPC contracts that were used as collateral for financing other potential EPC projects;
  •  ESCO insurance instrument – how much investments were mobilized through the facilitation of the crediting of ESCOs;
  • ESCO Engineering model – how many ESCO companies were engaged by cities/municipalities to
  • operate and improve EE measures in public buildings;

3.2 Green Bonds

  • Municipal Green Fund (Green bonds) – evaluate the impacts of recently approved legislation and new market rules;
  • Status of the interest of Ukrainian cities on launching of municipal green bonds; and the interest of other cities regarding the establishment and operation of a municipal green fund;

3.3 Other financing sources (e.g., EIB, EE Fund) – how much investment was mobilized with ESCO support in improving and managing quality of EE investments;

3.4 Do a stocktaking on the preparation of the universal banking products, noting any new objectives and requirements of banks in regards the financing of ESCO-led EPC EE projects.

 

4. DELIVERABLES

  1. Concise report on status, analysis and economic impact (in numeric data and coefficients) of each FSM pilot projects by 15 June 2021;
  2. Report on recent development and trends in the sphere of providing affordable financing and various FSM in Ukraine, with data and proof links by 15 June;
  3. Evaluation of feasibility of existing and developing FSM and instruments (including ESCO and Green Bonds finance schemes as well as support from other financing partners) in view of conclusions of 4.2.  by 15 June 2021;
  4. Final report containing ran overview of the findings, lessons learned, recommendations and integrating comments received by 30 June 2021.

 

5. MANAGEMENT ARRANGEMENTS

The consultant will be responsible for the achieving of the objectives of the assignment. The Consultant will report to the Project Manager and will work closely with representatives of Ukrainian municipalities, banks and ESCOs.

Consultant will be responsible for all personal administrative expenses associated with the assignment, which include printing costs, stationary, telephone and electronic communication.

 

6. MONITORING REQUIREMENTS / TERMS OF PAYMENT

The quality will be assured by proper contract management and detailed work plan to monitor progress achieved.  All the documents will be subject to acceptance by the Project Manager and the CTA

Work-progress reporting/monitoring meeting will be held with the IC holder on a regular basis, interim progress reports will also be requested by UNDP Project Manager to ensure the timely progress and work plan implementation.

The documents should be submitted in electronic or paper form in English or Ukrainian and should be developed in line with the UNDP principles of gender-responsive communications.

Payment under this contract is to be made after acceptance of working plans and services delivered by the Consultant upon submission of an output report, other deliverables and an invoice indicating exact number of workdays and description of tasks performed.


Competencies

  • Demonstrates integrity by modeling the UN’s values and ethical standards;
  • Promotes the vision, mission, and strategic goals of UNDP;
  • Displays cultural, gender, religion, race, nationality and age sensitivity and adaptability;
  • Treats all people fairly without favoritism;
  • Fulfills all obligations to gender sensitivity and zero tolerance for sexual harassment. Demonstrates integrity by modeling the UN’s values and ethical standards;
  • Promotes the vision, mission, and strategic goals of UNDP;
  • Displays cultural, gender, religion, race, nationality and age sensitivity and adaptability;
  • Treats all people fairly without favoritism;
  • Fulfills all obligations to gender sensitivity and zero tolerance for sexual harassment


Required Skills and Experience

7. REQUIRED COMPETENCIES, EXPERIENCE AND QUALIFICATIONS

Minimum qualifications and experience:

Education:

  • At least Masters degree in the fields related to Economics, Finances, Banking, Law, and/or Engineering or relevant related fields.

Experience:

  • At least 5 years’ working experience within Ukrainian financial, building sector, including some experience of project financing related to the energy sector.
  • At least 3 years’ working experience in the development of financial instruments/mechanisms/tool and/or products, preferably for energy or buildings sector.
  • At least 2 years’ of experience of partnership and networking with governmental and local authorities
  • Proven experience of working with international financial organizations and institutions with regard to designing and/or providing financial instruments and solutions for national entities, preferably related to municipal energy efficient sector.
  • At least 2 Reports/studies/publications related to finance/investment solutions for energy and environment sector
  • Prior working experience with similar assignment within reputable international organization or governmental body will be an advantage.

Language Proficiency:

  • Proficiency in Ukrainian is mandatory;
  • Working knowledge of English is a valuable asset.

 

8. DOCUMENTS TO BE INCLUDED WHEN SUBMITTING THE PROPOSALS

8.1 Applicants shall submit the following documents:

  • Letter of interest/proposal;
  • CV/P-11 including information about experience in similar projects / assignments and contact details for referees;
  • Financial proposal
  • Examples of reports/studies related to energy efficiency and environment (minimum 2 reports/studies/publications).

 

8.2 Financial Proposal

 Lump-Sum based on Delivery of Outputs

The financial proposal shall specify a lump sum amount. In order to assist the requesting unit in the comparison of financial proposals, the financial proposal will include a breakdown of this daily fee-based amount and number of anticipated working days.

 

9. EVALUATION OF APPLICANTS

9.1 Evaluation criteria

The following criteria will be rated as indicated below:

  • University degree (8 points max): PhD – 8 points, Masters/Specialist – 6 points;
  • At least 5 years’ working experience within Ukrainian financial, building sector, including some experience of project financing related to the energy sector (10 points max): more than 10 years – 10 points, 8-9 years – 8 points, 5-7 years – 7 points;
  • At least 3 years’ working experience in the development of financial instruments/mechanisms/tool and/or products, preferably for energy sector 20 points max): more than 10 years – 20 points, 8-9 years – 18 points, 5-7 years – 16 points;
  • At least 2 years’ of experience of partnership and networking with governmental and local authorities; (10 points max): at least 2 years - 8 points, 3-5 years – 9 points, more than 5 years - 10 points;
  • Experience of working with international financial organizations and institutions with regard to designing and/or providing financial instruments and solutions for national entities, preferably related to municipal energy efficient sector (13 points max):  general practical experience 9 - points; related to municipal sector -  11 points; above mentioned but related to energy efficiency – 13 points;
  • Reports/studies/publications related to financial/investment solutions for energy and environment sector (5 points max): 2 publications – 3 points, more than 2 publications – 5 points;
  • Prior working experience with similar assignment within reputable international organization or governmental body will be an advantage (2 points max) (yes 2 - points; no – 0 points);

Excellent written and spoken Russian and Ukrainian. Working knowledge of English is a valuable asset (2 points max): Working knowledge of English – 2 points.

Maximum available technical score - 70 points.

9.2 Evaluation method

Cumulative analysis

Contract award shall be made to the incumbent whose offer has been evaluated and determined as:
A) responsive/compliant/acceptable, and
B) having received the cumulative highest score out of a pre-determined set of weighted technical and financial criteria specific to the solicitation.
* Technical Criteria weight: 70%
* Financial Criteria weight: 30%
Only candidates obtaining a minimum 70% from the maximum available technical score would be considered for the Financial Evaluation.
The maximum number of points assigned to the financial proposal is allocated to the lowest price proposal and will equal to 30. All other price proposals will be evaluated and assigned points, as per below formula:
30 points [max points available for financial part] x [lowest of all evaluated offered prices among responsive offers] / [evaluated price].
The proposal obtaining the overall cumulatively highest score after adding the score of the technical proposal and the financial proposal will be considered as the most compliant offer and will be awarded a contract.



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