Horizon 2020 Energy Efficiency
Information Day
Finance for
sustainable energy
Topics EE 19 | EE 20 | EE 21
12 December 2014
Agenda
14:00 Welcome and Introduction
Anette Jahn, Head of Sector, EASME
14:10 The policy framework for financing energy efficiency
Roman Doubrava, Policy Officer, DG Energy
14:15 Overview of the funding area Finance for sustainable energy
Adrien Bullier, Project Officer, EASME
14:20 EE19: Improving the financeability and attractiveness of sustainable energy
investments
Christof Marx, Project Officer, EASME
14:30 EE21: Development and market roll-out of innovative energy services and
financial schemes for sustainable energy
Stephan Renner, Project Officer, EASME
14:40 EE20: Project development assistance
Martin Eibl, Project Officer, EASME
14:55 Questions and answers
Finance and sustainable energy
Trying to match squares and circles?
We’ve got
money, but…
we’re looking
for projects!
Green bonds market forecast
at USD 40bn for 2014 (BNEF)
Financial sector
ESCO?
Innovative
financing?
 “Investment project” for
the financial sector:
•
•
•
•
•
technical black box
standardized product
cash-flows, IRR, NPV
predictability of risks
transaction costs
 “Investment project” for
many project developers:
•
We’ve got
projects, but…
we’re looking
for money!
Adapted from C. Milin, ECEEE 2013
Projects
developers
> 6,100 signatories of Covenant of
Mayors
+ all other stakeholders committed to
climate and energy goals
•
•
•
technical design tailored to
physical constraints
state-of-the-art technology
energy payback times
“no financing” = “no subsidy”
?
This presentation requires oral explanations
3
Finance and energy efficiency investments:
filling the gap through EU programmes
We’ve got money,
but… we’re looking
for projects!
Green bonds market forecast
at USD 40bn for 2014 (BNEF)
Financial sector
Dedicated credit lines
National
funding
Risk-sharing schemes
Equity provision
EU structural
and investment
funds
Innovative
financing?
ESCO ?
Project dvpt assistance
IEE &
Horizon 2020
Benchmark investments
Awareness of investors
Organise dialogue
Capacity building
EPC facilitation
Local financing schemes
We’ve got
projects, but…
we’re looking for
money!
Project developers
+/- €85 bn/year add''l
investment required in EE
Adapted from C. MILIN, ECEEE 2013
This presentation requires oral
explanations
4
Horizon 2020 Energy Efficiency
Information Day
Improving the financeability &
attractiveness of sustainable
energy investments
Topic EE 19
EE 19: Overview
(1/2)
Scope
Foster dialogue with and between financial market actors,
standardisation and valuation entities, industry, public
authorities, consumers and property owners.
Three sub-topics
1. Develop frameworks for the standardisation and
benchmarking of investments
2. Target public institutional investors
3. Create EU / national sustainable energy financing platforms
Consortia
Min. of 3 independent legal entities from 3 countries, except for
national platforms where 1 entity is sufficient.
EE 19: Overview
(2/2)
Indicative budget
€0.5 – €2.0 million
Expected impact (depending on the projects)
• Reduced uncertainty - increased investors' confidence and
trust
• Innovative (and relevant) asset valuation methodologies
agreed by the market
• Standardised descriptions of sustainable energy
investments or measures/contracts
• Labelling schemes or harmonised frameworks for
sustainable energy investments
• National strategies for financing sustainable energy
investments
1. Develop frameworks for the
standardisation and benchmarking of
investments
• For example:
• Labelling and standardisation of sustainable energy
investments or portfolios
• Valuation techniques integrating the 'green value' of
buildings
• Proposals integrated in a broader approach such as
socially responsible investment or 'green buildings' should
focus on the energy component.
2. Target public institutional investors
• Public institutional investors (e.g. public or semi-public
pension schemes)
• Increase the share of their funds invested in sustainable
energy
• Develop specific funds or investment products.
3. Create EU and national sustainable
energy financing platforms
• Bridge the gap between the financial sector and the
sustainable energy sector:
• organise dialogue between all relevant stakeholders
• develop roadmaps
• propose improvements in the legal frameworks
• develop template documents and contracts leading to
a better understanding of the market.
• Proposals from 1 single entity are eligible
• The mechanism for knowledge sharing between countries
will be established by the Commission services
EE 19: Project examples (Call 2014)
•
Develop valuation techniques and norms that recognise EE in the
valuation of residential property. Use property value increases in asset
backed mortgage structures.
•
Develop protocols to standardise project development and
documentation for commercial buildings and get commitment from
investors that they will demand the use of these protocols by project
developers seeking finance.
•
Establish a common practice for professional risk assessment based
on technical and financial due diligence for PV installations financed by
professional investors.
•
Develop a framework to assess the ‘climate performance’ of assets and
investment portfolios and integrate the framework in databases and
portfolio optimisation tools used by investors and in mandates of asset
managers.
•
Set up an a labelling and benchmarking framework for energy
performance contracts on commercial buildings, in order to build trust in
the financial sector
•
Establish a national financing platform and develop a standardised
investment instrument with the capacity of channelling capital market
resources into on-farm RESs.
Horizon 2020 Energy Efficiency
Information Day
Energy services and
financial schemes
Topic EE 21
The Challenge
• Further EE improvements needed
• Public budgets are limited
• Improvement of legal & financial
framework for energy services needed
• Large-scale roll-out of innovative energy
services and financial schemes
The Scope (1/3)
1. Roll-out of business models for
innovative EE services
• Monetise energy savings
• Energy performance contracting (EPC)
• Specify clearly your business model
•
Example: IEE-Project 'EESI2020'
The Scope (2/3)
2. Replication of successful
innovative financing solutions
• Proven solutions (implemented!)
• Specify clearly the financing mechanism
• Get expertise on financing on board
• Example: IEE-Project 'Infinite Solutions'
The Scope (3/3)
3. Large-scale capacity building for
public authorities & SMEs
• Set-up or use innovative financing
schemes for sustainable energy
• Active involvement of financial
insitutions / financing expertise
Be clear about the expected impacts!
(depending on specific project objectives)
•
Savings of at least 25 GWh/year for every 1 million
Euro of EU support;
•
Larger investments in renewable energy & energy
savings;
•
Better implementation of energy-efficiency policies,
number of policy makers influenced;
•
Number of people with increased skills;
•
Number of people changing their behaviour.
EE21: Project Examples (Call 2014)
• Map and customize best practices ESCO markets and
implement capacity building applying the “training of
trainers” concept.
• Introducing innovative financing models (revolving funds,
Energy Performance Contracting, Third Party Financing,
cooperative models) in 3 pilot regions.
• Develop a cooperation platform to stimulate the
establishment of SME partnerships for energy services
and engage local supply side actors to offer standardized
energy service packages.
• Develop new business and financing models to implement
comprehensive refurbishment in public buildings using
energy performance contracting (EPC).
Horizon 2020 Energy Efficiency
Information Day
Project Development
Assistance (PDA)
Topic EE 20
The Scope of EE20:
Project development assistance will be provided to public and
private project promoters such as public/private infrastructure
operators, energy service companies (ESCOs), retail chains,
cities and SMEs/industry, leading to innovative, bankable and
aggregated sustainable energy investment schemes and
projects of EUR 6 million – EUR 50 million.
Proposals must
• Lead to investment at the end of the action:
Every million Euro of H2020 support must trigger
investments worth at least EUR 15 million (1:15).
 support is conditional on mobilised investments (payback clause!)
• demonstrate a showcase dimension in terms of delivering
organisational innovation in the mobilisation of the
investments and/or the financial approach.
• Have a high degree of replicability including a clear action
plan to communicate across Europe towards potential
replicators
• Activities supported by PDA include to mobilise relevant
stakeholders, draw up investment inventories, develop feasibility
studies, set up financial engineering instruments, address legal
and procurement issues.
 Actual hardware investments, basic research or technology
development are not covered!
• Focus on existing public and private buildings, retail energy
market infrastructure, commercial and logistic properties and
sites.
• Innovation should be demonstrated taking into account the
situation in the targeted country.
• Proposals from 1 single entity are eligible for this topic.
Project examples
22 MLEI projects supported under Intelligent
Energy Europe from 2011- 2013
 http://ec.europa.eu/energy/intelligent/files/mlei-projects-2011-12.pdf
• MLEI Energies Posit'if (France)
• Low-energy refurbishment with guaranteed energy
savings in 32 condominiums as well as 8 social
housing and public buildings
• Developing extended Energy Performance Contracting
services to condominiums beyond normal market
standards
• Minimum 60% energy savings targeted
• €40 million investment after 36 months
 www.energiespositif.fr
Project examples
• H2020 Call 2014 – EE20
• Bundling 8 public buildings (mostly schools) for
energy refurbishment through Energy Performance
Contracting
• Spreading use of EPC concept within the region
• Average 60% energy savings targeted
• €7.5 million investment after 30 months
Project examples
• H2020 Call 2014 – EE20
• Low-energy refurbishment with guaranteed
energy savings in 80 multifamily buildings in the
Baltics
• Addressing the cash-flow problems of ESCOs
through developing a forfeiting fund
• Minimum 60% energy savings targeted
• €30 million investment after 36 month
Some FAQ's
• What is the concrete outcome expected from PDA projects?
• What if my project fails to deliver the
investment?
• How does PDA relate to the ELENA
Facilities?
 please consult the FAQs for ENERGY EFFICIENCY - MARKET
UPTAKE PDA (published next week) on the Horizon 2020
Participant Portal
http://ec.europa.eu/research/participants/portal/desktop/en/opportunities/h2020/calls/h2
020-ee-2015-4-pda.html
More information: Participant Portal
• EE19
http://ec.europa.eu/research/participants/portal/deskt
op/en/opportunities/h2020/topics/2379-ee-192015.html
• EE20
http://ec.europa.eu/research/participants/portal/deskt
op/en/opportunities/h2020/topics/2381-ee-202015.html
• EE21
http://ec.europa.eu/research/participants/portal/deskt
op/en/opportunities/h2020/topics/2380-ee-212015.html
Horizon 2020 – Energy Efficiency call
Deadline 4 June 2015 17:00 CET - Online
resources
• EASME Energy Efficiency webpage:
http://ec.europa.eu/easme/en/energy
• Horizon 2020 work programme 2014-2015
 Secure, clean and efficient energy challenge
 Energy Efficiency call
 Section D: Finance for sustainable energy
 Topics EE19, EE20, EE21
•
http://ec.europa.eu/research/participants/data/ref/h20
20/wp/2014_2015/main/h2020-wp1415-energy_en.pdf
• Practical information on H2020:
http://ec.europa.eu/programmes/horizon2020/en/h
ow-get-funding
For all questions:
[email protected]
National Contact Points:
http://ec.europa.eu/research/participants/portal/desktop/en/
support/national_contact_points.html
Thank you for your attention!
@H2020EE