RENOWATT ARM General Assembly May 26, 2016 With the support of:
Agenda ▪ H2020 – Citynvest project ▪ Genesis of the project ▪ Creation of a One Stop Shop ▪ Activities of the one Stop Shop ▪ Tendering procedure ▪ Financing of the project ▪ Key take-aways – challenges so far 2
The province of Liege ▪ Located in Wallonia ▪ Located in Wallonia (one of the 3 Belgian Region) (one of the 3 Belgian Region) ▪ 1 million inhabitants ▪ 1 million inhabitants ▪ Liege province: 84 municipalities ▪ Liege province: 84 municipalities ▪ Circuit de Spa Francorchamps (F1) ▪ Circuit de Spa Francorchamps (F1) http://www.euregio-mr.com/fr/euregiomr http://www.euregio-mr.com/fr/euregiomr 3
GRE Liege – Reconversion economic agency of Liege province G ▪ Develop conditions to ▪ Develop conditions to roupement roupement create sustainable jobs create sustainable jobs R for the future generations for the future generations edéploiement edéploiement ▪ Created in 2004, following ▪ Created in 2004, following E the announce of Arcelor the announce of Arcelor conomique conomique Mittal closure Mittal closure 4
Energy renewal offers real potential for the creation of jobs and businesses in the Region … potential to create businesses Looking to Europe ... in Wallonia ▪ Commitment from the Member States of the If 60% of the buildings in Wallonia European Union to achieve the 20/20/20 goals: are renewed, there is a potential 20% reduction in CO 2 emissions, 20% renewable for energy and 20% energy savings between now ▪ 30 billion euro and 2020 ▪ Maintenance / creation of ▪ In Europe, buildings more than 20 years old 500,000 jobs (if everything is account for 95% of the total stock. In Liège, more done at once), or 16,000 jobs if than 98% of buildings are at least 20 years old, the investments are spread which results in excessive energy consumption over the next 30 years ▪ In Belgium, energy consumption in buildings ▪ For Liège, maintenance / accounts for 40% of total energy consumption creation of more than 4000 jobs ▪ Creation of more than 2,000,000 jobs in Europe to meet the 2020 challenges ▪ 1,000,000 to invest in renewal will create / maintain 17 jobs 5 SOURCE: DG Energy European Commission; Build Up Skills; IWEPS
Agenda ▪ H2020 – Citynvest project ▪ Genesis of the project ▪ Creation of a One Stop Shop ▪ Activities of the one Stop Shop ▪ Tendering procedure ▪ Financing of the project ▪ Key take-aways – challenges so far 6
Idea to set up a structure to support beneficiaries (local authorities, hospitals, industrials…) in their urban energetic retrofitting projects Finance Building selection Subsidised loans Tax Public Actors / Public Actors / incentives Hospitals / Industrials Hospitals / Industrials Public susbidies One Stop Shop Third party financing Tendering procedure 7 1 Public authorities as a first step –plan to open to hospital and industries
European Energy Efficiency Fund was identified to finance the One stop Shop ▪ PPP intended to halt climate change ▪ Project intended to improve energy efficiency by at least 20% Objectives Objectives ▪ Technical assistance to prepare the project Types of Types of ▪ Financing (between €5 and €20 million) for infrastructure projects assistance assistance (minimum €5 million required) ▪ Municipalities ▪ Local and regional authorities Beneficiaries Beneficiaries ▪ Public or private entities acting on behalf of local and/or regional authorities (transport companies, social housing, ESCOs, etc.) ▪ Initial capitalisation of the fund: €265 million (EU, EIB, Cassa Despositi e Prestiti, Deutsche Bank) Capital Capital ▪ Financing of the project preparation costs for 90% of eligible costs Hedging Hedging (supplementary costs) ▪ Minimum return factor: 20 Investment program Investment program must be finalized by must be finalized by February 2017 February 2017 8 SOURCE: EEEF
So far, 11 entities have joined the project Inhabitants Inhabitants (3 are paying entities) 9,000 9,000 24,000 24,000 Liege Airport Liege Airport Passengers: 315,293 Passengers: 315,293 200,000 200,000 40,000 40,000 Cargo: 561,000 Tons Cargo: 561,000 Tons 17,000 17,000 56,600 56,600 CHRH CHRH 60,000 60,000 15,331 15,331 Represents 50% of Represents 50% of 2,541 2,541 the building stock the building stock of the province of the province + Liège Province: 1.1 million + Liège Province: 1.1 million 9
The One Stop Shop will be set up Step by Step 2017 2016 ▪ Opening of the One 2015 Stop Shop Window’s ▪ Opening of the One 2014 services to all sectors Stop Shop’s services ▪ A fee is charged for ▪ Structuring of the for hospitals 1 the One Stop Shop approach for the ▪ Opening of the One ▪ Creation of the One- services hospitals Stop Shop’s services Stop-Shop ▪ Expanding the for industrialists 1 ▪ Provision of services services to all public ▪ The One Stop Shop’s to the public authorities services are charged authorities in the ▪ Launch and to the public province of Liège structuring of the authorities, and ▪ Subsidised services talks for the subsidised for ▪ Launch of the talks for industrialists hospitals and the hospitals industrialists ▪ The services of the One Stop Shop are subsidised 10 1 If a subsidy for hospitals and industrialists is provided in 2015, the activities will more than likely not be able to start before the beginning of 2016
Agenda ▪ H2020 – Citynvest project ▪ Genesis of the project ▪ Creation of a One Stop Shop ▪ Activities of the one Stop Shop ▪ Tendering procedure ▪ Financing of the project ▪ Key take-aways – challenges so far 11
Three basic principles to which the 10 public authorities will subscribe 1 Work according to Energy Performance Contracts (EPCs) 2 Grouping the buildings into batches / pools of buildings 3 Time dedication to the project 12
1 Giving priority to the EPCs Traditional model EPC model Energy Supplier Energy Supplier Insurers Insurers Maintenance Maintenance Financier / Financier / Gas supply Gas Gas Banker Banker Price Price Building Owners Building Owners contract of gas of gas Installers Installers Energy Suppliers Energy Suppliers Manufacturers Manufacturers Client Client Maintenance Maintenance Enterprises Enterprises Financing Financing Insurers Insurers Building Building Owners Owners Energy Service Company (ESCO) Energy Service Company (ESCO) Decrease of Heat / Heat / Bank Bank Insurers Insurers Owners Owners Building Building Installers Installers Manufacturers Manufacturers Price of heat Price of heat Energy Electricity Electricity / Electricity / Electricity consumption Client Client 13 SOURCE: Pierre-Alain Kreutschy_SI Genève (Suisse)
2 Grouping buildings into different pools / lots comprising multiple buildings ▪ Achieving an adequate size for ▪ Grouping multiple buildings, the EPC depending on the potential energy savings within a single ▪ Diversifying the risk for financiers project (and obtaining more attractive financing conditions) ▪ The buildings may belong to a single public body or to multiple ▪ Reducing the number of public bodies contracts (and transaction costs) 14
RenoWatt key dates 4 Feb 2016 July 7 - 31 oct – Feb 2015 25 mar 2015 1 June 2015 7 sep 2015 1 Feb 2016 Sep 30 2016 31 jan 2017 Start of the ESCO Launch Municipalities Launh of the procedure Selection of technical subscription to Attribution tendering selection for the specificities the tendering central the 4 candidates for the 4 central terndering tenders procedures 15
Activities realized so far ▪ Estimation of the energy saving potential ▪ Meeting with each of the municipalities to select the buildings 1 Building selection Building selection based on the savings ▪ Building selection by municipalities (municipal council) ▪ Publication of the 4 tendering procedure (schools, sport, miscellaneous and hospital) – candidate selection ▪ Selection of candidates 2 Tendering procedure Tendering procedure ▪ Publication of the 4 technical specifications ▪ How to deconsolidate this type of investments ▪ Funds or debt Financing of the 40 Financing of the 40 3 million euros million euros 16
Historique de la sélection des bâtiments 1 Builidind Fiche 1 Fiche 2 Quick Scans selection 148 sites 133 sites 122 sites 81 sites 250 buildings 231 buildings 211 buildings 151 buildings ▪ 65,5 million € ▪ 38,9 million € (45,2 investment with options) ▪ 20,7 million € investissements ▪ 10,5 € (12 with avec maintenance ▪ 428,000 m 2 options) maintenance ▪ 255,000 m 2 heated heated floor floor 17
1 Split of the investment by work type 64% of investment is insulation 64% of investment is insulation 18
Some figures ▪ Investment: Minimum of 38,9millions (option excl.) ▪ Maintenance: Minimum of 10 millions d’euros over 15 years (option excl.) ▪ Number of sites ▪ and buildings: 81 sites et 151 buildings ▪ Energy savings: 34% ▪ Average ROI: 21 years 19
Agenda ▪ H2020 – Citynvest project ▪ Genesis of the project ▪ Creation of a One Stop Shop ▪ Activities of the one Stop Shop ▪ Tendering procedure ▪ Financing of the project ▪ Key take-aways – challenges so far 20
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