Pre-Feasibility Study for a Second Phase of the SUNREF Palestine Project

SUNREF Palestine – a financial mechanism designed to support green investments in the Palestinian private sector – was launched in July 2018. It achieved remarkable success and performed beyond expectations. In less than 1.5 years, local partner banks utilized approximately 50% of the credit lines. Taking into account the loans already disbursed and the projects in the pipeline, it was expected that the banks would fully utilize the credit lines by H1 2020.   The local partner banks and the technical assistance service provider (Econoler) perceived that green energy was an emerging and promising market in Palestine and there was still a high potential and demand in this market. Accordingly, Proparco entered into the process of pre-identification of SUNREF II and sought the services of an experienced consultant to undertake a pre-feasibility study for the second phase of the SUNREF Palestine program.

Econoler was mandated to update the market analysis performed under SUNREF I and provide recommendations on the design of the second program phase based on the market analysis of and lessons learned from SUNREF I. Under the mandate, Econoler carried out the following tasks:

• Presented a general update of the market study performed for SUNREF I;
• Identified lessons learned from SUNREF I;
• Estimated the potential market demand by sector (EE/RE), typology of final beneficiaries, size, economic sector, and location;
• Identified the untapped market segments that were not considered as eligible beneficiary clients according to SUNREF I eligibility criteria;
• Reviewed the eligibility criteria of SUNREF I and provided different sets of recommendations for SUNREF II;
• Collected and analyzed the feedback on project financing conditions from final beneficiaries;
• Collected and analyzed the feedback from partner banks on difficulties with the decisions-making process;
• Based on lessons learned from SUNREF I, estimated the required investment grant amount for SUNREF II.

  In the end, Econoler submitted an analysis of the lessons learned from SUNREF I and updated the green investments market analysis to help Proparco design the second phase of the SUNREF Palestine financing program.