World Bank and GEF Support Efficiency of District Heating in Lithuania

The World Bank’s Board of Executive Directors approved a US$6.5 million grant from the Global Environment Facility (GEF) to finance the Vilnius Heat Demand Management Project in Lithuania, which aims to reduce greenhouse gases emissions from the Vilnius District heating system by implementing financially sustainable and replicable energy efficiency investments in the residential sector of the Vilnius City. The project will achieve this by: (a) co-financing Vilniaus Energija's demand management program which will demonstrate the benefits of automatic and consumer-controlled use of heat in homes and consumption-based billing at the apartment level, with limited grant financing for low-income customers; (b) creating a commercially sustainable (revolving) financial facility – Energy Conservation Program Commercial Fund – to support the implementation of investments aimed at reducing heat losses from the City's housing stock; and (c) implementing monitoring, evaluation, and information dissemination activities aimed at facilitating the replication of the project's outcomes. The GEF Project will support and supplement the programs pursued by both Vilniaus Energija and Vilnius City Municipality. Under the project, the GEF will help establish a broader and more sustainable program to support the installation of energy efficiency equipment in residential buildings of Vilnius and engage Vilniaus Energija and the Vilnius City Municipality in the development of a market for energy efficiency products. This will be achieved by introducing demand-side management measures such as thermostatically controlled radiator valves and heat meters in Vilnius households, as well as building-envelope improvements to reduce energy losses from the residential buildings. Since Lithuania joined the World Bank in 1992, Bank commitments total approximately US$473.7 million for 17 projects.