In 2021, Nefco launched its new strategy and celebrated 30 years of green financing as the Nordic Green Bank with a strong focus on the scale-up of Nordic green solutions. The Green Recovery Loan Programme for Nordic small and medium-sized companies (SMEs) drew immediate interest and several projects were agreed. Other financing activities also proceeded according to plan.

At the end of the year, Nefco had 400 (381 in 2020) active projects in its portfolio. During the year, 59 projects ended and 91 new projects were agreed. Of the active projects, 137 were investments in economic activities that were assessed under the EU Taxonomy for sustainable investments. Based on a preliminary assessment, 76% of Nefco’s investment projects were Taxonomy eligible.

“In 2021, we started to apply the EU Taxonomy classification system in addition to our already proven environmental assessment methodology. Although still being work in progress, as the Nordic Green Bank, we are pleased to see the results of our first year using the Taxonomy classification,” said Trond Moe, Managing Director of Nefco.

The majority of projects financed by Nefco are related to climate change mitigation, mainly through energy-efficiency measures and the production of renewable energy. The number of projects related to the sustainable use and protection of water and marine resources, pollution prevention and circular economy is increasing.

The financial result for the year was EUR 2.9 million (EUR 3.6 million in 2020). Interest income on lending rose by 9% compared with 2020. Administrative expenses increased, mainly due to several new recruitments in support of Nefco’s new strategy.

At the end of the year, Nefco’s equity was EUR 172.6 million (EUR 169.6 million). In addition to its own capital, Nefco had trust fund assignments that totalled EUR 361 million (EUR 428.5 million).

Focus on the scale-up of Nordic green solutions

With its new strategy, Nefco is increasingly financing the global scale-up of green Nordic SMEs.

“It is often difficult for these companies to access scale-up funding, but we can support them by taking a greater financial risk – if there is a green upside,” Moe explained. “The pandemic has also slowed business growth. That is why we developed the Green Recovery Loan Programme; the first projects were approved in January, soon after launch. Over the year, we financed a steady flow of interesting green projects under the programme.”

At the end of 2021, Nefco’s portfolio included 46 investments to SME projects on global markets and 157 Nopef-financed feasibility studies for internationalisation.

“Our task is to accelerate the green transition. Our happiest moments are when a Nordic green entrepreneur scales up internationally or a Nefco-financed green project has encouraged others by demonstrating what is possible. As the Nordic Green Bank, we expect more than just Return on Investment: we expect Return on Impact.”

In addition to the SME programmes, the new initiatives for clean energy access in Africa and the positive development regarding the Paris Agreement’s new Article 6 rules provide opportunities for incentivising climate change mitigation activities.

In Eastern Europe, Nefco has a long history of working with the green transition of municipalities, positively impacting communities and the people in these regions. Following the brutal, illegal and unprovoked Russian invasion of Ukraine in February 2022, supported by Belarus, Nefco has decided to immediately cease all activities in Russia and Belarus as announced in the statement on 9 March 2022. In Ukraine, Nefco will support clients, partners and project activities as best as it can.

Other environmental and sustainability impact highlights

A majority of projects financed by Nefco contribute to climate change mitigation by reducing or avoiding carbon dioxide (CO2) emissions. Carbon fund projects managed by Nefco generated certified emission reductions (CERs) equivalent to 2.09 million tonnes of CO2e emissions. Since their start in the early 2000s, Nefco’s carbon funds have generated 31.6 million CERs. The funds closed at the end of 2021.

In terms of energy-efficiency measures, projects financed by Nefco directly reduced energy consumption by 109 gigawatt-hours. On average, the energy-efficiency projects financed by Nefco in Eastern Europe generated savings of 62% in electricity usage and 58% in heat energy usage compared with the pre-project situation, which resulted in CO2 emission reductions of 63%. In street lightning projects, the average electricity saving is 75%.

The SME projects financed by Nopef (the Nordic Project Fund) in 2021 can be expected to contribute, in total, to some 190 new jobs and over EUR 26 million in green investments in the coming years. The estimate is based on an assessment of the Nopef programme, which indicated that each realised Nopef project contributes to 10 new jobs, of which two in the Nordic region, and the average project-related investments amount to EUR 1.0 million per project. Nopef is funded by the Nordic Council of Ministers and has been administered by Nefco since 2014.

Annual Environmental and Sustainability Report

View our annual reports

Environmental and sustainability report 2021

Financial report 2021

Ethics and Compliance – Annual report 2021

For further information, please contact:

Josefin Hoviniemi, Vice President Communications, Nefco

josefin.hoviniemi@nefco.int, +358 50 464 6995

Trond Moe, Managing Director, Nefco

Trond.moe@nefco.int, +358 10 618 0662