The objective of the Energy Efficiency Financing Project is to improve the energy efficiency of medium and large-sized industrial enterprises in China, and thereby reduce their adverse environmental impacts on climate. This project paper seeks the approval of the Executive Directors to provide an additional loan in an amount of US$100 million to the People's Republic of China to scale-up the project. The overall performance of the project, including the two separate loans being implemented by Export-Import Bank of China (EXIM) Bank and Huaxia Bank, as well as the Global Environment Facility (GEF) grant, has been satisfactory. Project management, procurement, financial management, and safeguards are all rated satisfactory. The project is playing a significant role in increasing the participating banks' capacity, interest, and confidence in mainstreaming the Energy Efficiency (EE) financing business line. The additional financing (AF) has three improved or expanded features, compared to the project. (a) piloting innovative Energy Service Company (ESCO) lending, under which end-users pay for ESCOs' EE services from the demonstrated energy savings under performance-based contracts, and broadening the sub-borrowers from large and medium-sized industrial enterprises to energy end-users of all sizes and ESCOs; (b) expanding the target market segments from the industrial to the building sector, given the rapid growth in energy demand for buildings, and government's plan to expand the range of priority energy conservation programs; and (c) increasing the leverage ratio of the International Bank for Reconstruction and Development (IBRD) loan to EXIM Bank contribution.