ECOCASA ProgramECOCASA Program

ECOCASA: Low Carbon Housing in MexicoChallenge:• Residential sector being responsible for 17 % of energy consumption in Mexico and

about 4.5% of CO2 emissions, increasing rapidly.• Mexico has made commitments to reduce CO2e emissions to 50% below 2002 by 2050.

Approach:• Boosting housing construction with low carbon footprint through the “Sustainable

Housing Program in Mexico ECOCASA” developed jointly by the Mexican Sociedad Hipotecaria Federal (SHF), the German Development Bank KfW, the Inter-American Development Bank (IDB) and the European Union (LAIF).

• The Program consists of financial incentives and technical assistance to support housing developers with the design and implementation of low carbon houses.

• Additional technical assistance for the support of sector wide reforms.

Expected results:• Financing of up to 27,000 energy-efficient social housing units, in 7 years.• Reduction of more than 1 million tons of CO2e emissions during the life-cycle of the

housing units.

Sample Technologies Used:• Insulation in roof and walls, reflective paint, efficient gas boiler, efficient construction

materials, bioclimatic housing design, solar water heater, energy saving windows.

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ECOCASA

ECOCASA: Financial Incentives and Benefits

• ECOCASA Project developers receive concessional loans through SHF.

• Lower interest cost compensate for the additional costs for energy efficiency measures.

• Selling price of each ECOCASA housing units does not exceed the price of a comparable standard unit, ensuring affordability for low-income families.

SHF receives concessional loans for ECOCASA from the Clean Technology Fund (CTF), the Inter-american Development Bank (IDB) and the German Ministry of Economic Cooperation and Development (BMZ) through KfW. It also receives a grant from the European Union (LAIF).

SHF gives below-market refinancing to financial intermediaries, which pass the benefit to the housing developer, keeping the intermediation margins constant.

ECOCASA: Project Cycle and Operation

1. The housing developer presents a low carbon housing project for ECOCASA financing.2. An independent consultant runs a simulation of the project, considering the energy performance of

the house with the SISEVIVE-ECOCASA tool, developed by INFONAVIT*.3. SHF, IDB and KFW accept or reject the project proposal on the basis of clear eligibility criteria.4. SHF notifies the financial intermediary and assigns the concessional loans to the project.5. The developer with the concessional funds begins construction of the project.

SHF-IDB-KfW define an operational outline to determine the eligibility of the proposed projects in a efficient manner; under 5 stages:

*INFONAVIT, the National Workers’ Housing Fund, It is the largest social mortgage financial institution in Mexico, and a strategic partner in the implementation of the ECOCASA Program

1 2 3 4 5

Developer Evaluation Tool SHF | BID | KFW Financial Intermediary Desarrollador

Project Proposal Project Simulation Approval Construction Loan Begin of Construction

Mortgage Loan

YES

NO

ECOCASA: Expected ResultsDirect Results:• Construction of up to 27,000 energy-efficient social housing units, in 7 years.• Reduction of more than 1 million tons of CO2e emissions during the life-cycle of the

housing units.• Development of bioclimatic design of the houses, taking into consideration the

particular characteristics of each location.• Development of methodologies to assess housing performance, considering the house

and its surroundings.

Long Term Transformative Results:• Establishment of clear and transparent eco-standards to create incentives for

developers to upgrade their project designs and build their capacities.• Showcasing of financial and technological feasibility as well as higher level of comfort of

energy efficient housing leads to higher acceptance and demand for ECOCASAs.• Increase demand for eco-technologies fosters the development of domestic

engineering and production capacity leading to increased availability and falling costs.

Increased demand for eco-

technologies

Lowering the eco-technologies cost

Fostering the development of a “Green” National

Industry

Long Term Sustainability

Establishment of eco-standards

and showcasing of feasibility

ECOCASA: Implementation and Next StepsThere are 3 pilot projects under construction in Monterrey, Pachuca and Tula with a total of 1,221 ECOCASAs.

Amount DisbursedActions: 1,221

Amount: $13.65 million

Amount CommittedActions: 10,245

Amount: $156.85 million

Registered Projects 2013Actions: 11,466

Amount: $170.5 million

Program Target

Actions:27,600

Amount:$476 million

Inver Martin

ECOCASA ProgramECOCASA ProgramMore information:Claudio Alatorre: Calatorre@iadb.org Ingrid Hahn: Ingrid.Hahn@kfw.de Jesús Cano Vélez: acano@shf.gob.mx

Press contact: Agustin Caceres: agustinc@iadb.org Felicitas Birckenbach: Felicitas.Birckenbach@kfw.deSteve Shalita: sshalita@worldbank.org Estefany López: nlopez@shf.gob.mx

USD Million

The Problem:

Housing sector represents 17% of total energy usage and 4.9% of CO2 emissions in Mexico

Program Objective:

• Reduction of greenhouse emissions from the housing sector.

• Improvement of living conditions for low income families.

Expected results

• 26,000 sustainable houses for 2020 (houses with greenhouse gas emission reductions from at least 20%)

• 600 passive houses (reductions from 70% to 90% from CO2e)

• 1,700 Green Mortgages

• Expected Mitigations Impact: 1 million tCO2e

• Improvement of comfort for households (20-25 ˚C average)

105.55 Financing for housing developers

49.5 Financing for housing developers

2.1 Technical Assistance

50 Ordinary Capital for Green Mortgages

9.3 Subsidy for Passive Houses

13.3*Financial Cooperation for

a sector wide NAMA implementation

ECOCASA is supported with concessional loans and grants from the following partner institutions :

ECOCASA: Program Structure and Financing

* In approval phase

Backup

ECOCASA: Technical Assistance / Capacity Building

• ECOCASA receives non refundable TA resources for the following purposes:Knowledge management and generation activities

Technical studies on the GHG emission factor of water in Mexico. Determination of the carbon footprint of new housing linked to transport needs. Communication and Diffusion Activities (website, videos, events). Improvement of the Simulation Capabilities (SiseVive and Climate Change models).

Capacity Building: Sector wide capacity building for developers in energy efficiency standards. Users manual and training for neighborhood associations in the correct use and the

maintenance of eco-technologies. Link to Municipal and State Policies.

Monitoring, Reporting and Verification: A basic and detailed Monitoring, Reporting and Verification (MRV*) system to

measure the performance of the energy efficient appliances in the houses, aligned to the Mexican Sustainable Housing.

* MRV as defined in the NAMA

Backup

ECOCASA: Sample Project SimulationBackup

ECOCASA: Pilot Project PachucaBackup

ECOCASA: Pilot Project MonterreyBackup