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Raising Development Impact through Evaluation

People’s Republic of China: Shandong Energy Efficiency and Emission Reduction Project

Evaluation Document | 24 July 2020

The project was approved by the ADB in August 2011. The project focused on (i) expanding investment in energy efficiency in selected energy intensive industries in Shandong Province; (ii) developing energy service companies through energy management contracts; and (iii) enhancing capacity to identify, finance, and manage energy efficiency and emission reduction projects. The government requested ADB to finance the project under a financial intermediation loan through the China Everbright Bank — a national commercial bank established in 1992 by a state-owned investment conglomerate.

The financial intermediation loan modality was selected as appropriate to (i) build knowledge and capacity of Shandong provincial government and China Everbright Bank to evaluate and assess risk for energy efficiency project investments; (ii) reduce investment transaction complexities; (iii) enable the rollover of the ADB loan proceeds to support multiple subprojects and leverage additional domestic investments; and (iv) enhance governance and safeguard compliance for energy efficiency projects. Funds were expected to be rolled over to finance several batches of subprojects. This validation pertains to the results from the first batch of subprojects. IED overall assessment: Successful.