Polish credit insurer KUKE may issue PLN 10 bln in guarantees for energy transition projects
Polish credit insurer KUKE may issue PLN 10 billion (EUR 2.3 bln) in guarantees to companies in this and next year to finance energy transition expenditures and investments to achieve a climate-neutral economy, KUKE CEO Janusz Wladyczak told a conference. Among others, investors in the renewable energy industry, but also energy consumers under PPAs can apply for guarantees, he noted.
"PLN 10 billion is the amount for which we can provide guarantees this year, but also in 2025," Wladyczak said.
At least for the moment, the sum of these guarantees cannot exceed PLN 10 billion (EUR 2.3 bln).
"On the other hand, we are willing to reallocate some of the funds within the budget if we see more interest because our total amount for this year is PLN 55 billion for various types of projects," the CEO said.
"The instruments are available as of today. Talks with both investors and financial institutes have already begun," he added.
He indicated that most of the banks present in Poland, but also banks from outside Poland, as well as pension and investment funds, have expressed interest in joining the programme.
The chairman of KUKE expressed hope that at the turn of September/October, appropriate agreements will be signed with banks, which will “spread” this source of financing on the market.
Asked about the price of the guarantee, he replied that it must be market-determined and can range from 0.2 percent per year to even approximately 2 percent of the value of the guarantee, depending on the risk.
As he explained, financing with the guarantee can still be cheaper than without it because in the case of the KUKE guarantee, the bank itself takes a minimum of 20 percent of the risk, while up to 80 percent of the risk under the guarantee is assumed by the State Treasury, which reduces the cost of financing.
According to the head of KUKE, the energy transition needs so-called “long-term finance,” and the credit insurer's guarantee can be provided for financing for up to more than 20 years.
In addition, according to the credit insurer, guarantees are an opportunity to generate up to 5 times the amount of funds for the transformation within the banking system.
The minimum value of a transformation project that can be covered by a KUKE guarantee is PLN 10 million (EUR 2.3 mln).
jz/ han/ nl/