SME steel producer invests in energy efficiency

Newco Jugoterm International L.L.C, a manufacturer of steel products
Gjilan, Kosovo
New state-of-the-art welding robots, press breaks 75t and 135t, L3 Fibre Laser Cutting machinery and a cross seam welding machine with DC transformers
Investment Size
€1.3 million
Financial results
Payback period of 5.2 years; annual cost savings of €250,000; IRR of 16.6%
Energy savings
1,960 MWh per year
CO2 savings
1,200 tonnes of CO2 per year
Increased production capacity and profitibility

Newco Jugoterm International LLC produces panel and towel radiators and other steel products. The company holds around 80% of the local market, exports its products and has overall sales of more than €3 million per year.

To maintain its low energy consumption rates, the company planned to modernise its production line which consumes electricity and diesel.

The company addressed KoSEP for loan financing. The investment project included installation of new state-of-the-art welding robots, press breaks, fibre laser cutting machinery and other equipment.

The KoSEP team assessed the project and, in particular, verified the energy savings potential of the measures and analysed its technical-financial parameters.

The €1.3 million investment allowed the company to decrease its  energy consumption by €250,000 per year or by 30 per cent of the previous energy consumption level. The investment will be repaid from energy savings in just over five years and the new cash-flow will become company income for years to follow. In addition , the investment allowed the company to increase production capacity and profitability by 35 per cent.

“The quality of our products has now reached European standards,” says the owner. “An additional benefit is that this investment eventually contributes towards improved health and safety of our workers, as it allows us to reduce acid gases and CO2 emissions by 1,212 tonnes a year.”

The EBRD, through KoSEP, supports the sustainable financing and implementation of energy efficiency and renewable energy projects by the private sector. Together, the private, residential and public sectors can make a change in energy consumption patterns and contribute to environmental protection.