LONDON, Nov 20 Reuters A private fund that plans to build power projects on sites such as hospitals and data centres to reduce energy wastage has secured backing from the European Union39;s investment arm.

The European Investment Fund EIF said it had invested 125 million euros in the 39;Green Energy Solutions Fund39;, which is run by Sustainable Development Capital SDCL.

The investment helped the fund hit its fundraising target of 650 million euros 707 million last month.

We see a big market failure. Energy efficiency is an area where there are tremendous needs, EIF Deputy Chief Executive Roger Havenith told Reuters, describing the investment as EIF39;s first in a fund focused on energy efficiency.

Havenith said the investment would help advance EU policy priorities of tackling climate change, and the fund had agreed to deploy 66 of its capital inside the bloc39;s 27 member states.

We step into funds where we see a particular added value and where we are not crowding out private investors, he said.

The EIF spends about 1315 billion euros annually and targets individual funds of up to around 1 billion euros in size, with an average investment of 85 million euros.

While global efforts to cut carbon emissions have prioritised renewable energy, SDCL CEO Jonathan Maxwell said as important a problem is that so much energy is lost.

The big dirty secret, he said, is that 70 can be wasted in the journey from molecule to extraction, conversion, generation and…