DECC Energy Savings Opportunity Scheme (ESOS) South West Launch - Bristol - 10th November 2014

PRESENTATION BY: PRESENTATION BY:

Monday 10th November

Carl Reynolds

The Energy Saving

Opportunity Scheme

South West Roadshow

What we’ll cover

• Business energy efficiency - challenges and

solutions

• two presentations

• Energy Savings Opportunity Scheme (ESOS)

• an introduction, discussion, questions

• Financing for energy efficiency

• presentations on the national and local picture

• The wider energy efficiency policy landscape

• an overview, discussion, questions

Objectives

To build awareness of the Energy Savings

Opportunity Scheme (ESOS) and;

The benefits of going beyond compliance by

implementing energy efficiency opportunities.

To gather feedback on the wider business

energy efficiency policy landscape.


Jes Rutter, JRP

Solutions on behalf of

Rolls Royce Business case study:

Rolls Royce

Rolls-Royce proprietary information

Trusted to deliver excellence

© 2014 Rolls-Royce plc

The information in this document is the property of Rolls-Royce plc and may not be copied or communicated to a third party, or used for any purpose other

than that for which it is supplied without the express written consent of Rolls-Royce plc.

This information is given in good faith based upon the latest information available to Rolls-Royce plc, no warranty or representation is given concerning

such information, which must not be taken as establishing any contractual or other commitment binding upon Rolls-Royce plc or any of its subsidiary or

associated companies.

The Energy Conservation Programme at Rolls-Royce Bristol.

Jes Rutter – JRP Solutions Ltd

Strategic Energy Partner to Rolls-Royce


The Recent Global Energy Challenge


Bristol Energy Reduction


Energy Charter

Critical Success Factors Benefits / Measures Major Risks, Assumptions

Energy Reduction Charter

Summary Objective

This project will deliver energy consumption and cost reductions through a combination of capital investment in viable energy hardware improvements and a management lead behavioural change to eliminate energy waste.

Executive Sponsor P Craig Date 1/5/2014

Current Stage Operational areas of the Defence business are well advanced in terms of identification of numerous schemes for capital submission and the ‘no-cost’ behavioral change required to eliminate energy waste.

Greater focus and management commitment is required in office locations to achieve the benefits we know are available.

Project Management

I Carr Version 1

Problem / Opportunity Objectives Scope

Out of hours surveys and analysis of data confirms high occurrences of energy waste. Typically a potential cost saving of £9,000 per weekend has been calculated in Bristol due to equipment and lighting being left on during out of hours periods and holidays. This needs to be addressed as a priority by all areas of the business. This is seen as a key business opportunity that will contribute to the ‘COST’ element of the Groups 4 ‘C’s focus. The reduction in consumption will also make a positive and measurable contribution to the Group Green House Gas (GHG) reduction target.

To ensure all Defence businesses locations have effective plans to eliminate occurrences of energy waste.

Gain the commitment and support of the management community at all levels.

Increase the current ‘energy champions’ community to mandate a member in all departments, delineated by its physical boundaries or owner manager.

Implement written ‘shut down’ plans for weekends, holidays and out of hour periods, in all departments.

To build upon the activities and Energy Champion roles already in place across the business.

In Scope

All areas of Defence business.

Equipment, machinery and systems that can be readily switched off, without impact to the business, process or equipment.

All Personnel.

Out of Scope

Only equipment and systems which are critical to remain live (i.e. servers, identified machinery).


Energy Charter Executive level engagement and prioritisation of the improvement

activities in each area of the business.

Capacity of business management to actively engage with the project.

Effective communication that positively engages all personnel.

Continuation of SME support from current external provider.

Benefits

Reduction of energy consumption and associated costs.

Achievement of the business reduction target of 10% by 2015.

Measurable contribution by the business to Corporate GHG reduction commitment.

Reduced negative impact on customers.

Metrics

Current business metrics aligned to Group HS&E targets.

Major Risks

Failure to drive project requirements through the business/site management structure.

Failure to proactively engage personnel across the whole business.

A total absence of capital for low cost < £10k projects.

Major Assumptions

DLT/Executive level sponsorship- Paul Craig

Delivery Approach Stakeholders Resources

Phase 1: Repeat the Energy awareness campaign with

Executive sponsor mandated actions.

Activities include the following:

Production, customisation and roll out of support tools

Build the existing, knowledgeable network of Energy Champions

Provision across the site of SME advice and support

Build the current site community of practice

Phase 2: Capturing the thoughts and ideas of key

stakeholders the project team will be responsible for shaping and improving a site wide improvement programme that can be shared much wider. Activities will include the following:

Establishment of base lining and collection of performance data

Detailed review of energy reduction schemes aimed at submission for targeted funding

Extension of current training (Bristol) for new Energy

Champions

Identification and defining of roles for Energy champions

Refreshment of existing energy reduction schemes

Review and sharing of best practice across the business through the current Defence Energy CoP.

Project Sponsor

Defence Leadership team

Management of all Defence business locations.

Business / function Leads

Local Energy Champions.

Ian Carr – Project Lead

Tracy Moore – Project support

SME – Jes Rutter (JRP-UK), Anthony Hatfield (GP), Daniel Waller (GP-USA), Mukesh Jha (JCI)

Carrie Snaden – Business / Site Communications

Business senior and Line Management

Business Energy Champions


Identify Where Energy is Used and Monitor Identify where energy use is

high and target those areas for

reductions. Identify areas

where energy use is increasing

and find out why!

Understand which

business activities

are the most energy

intensive to focus

the reduction

strategy.


Energy Project Planning & Management Energy projects

identified, prioritised,

tracked and validated

centrally.


Energy Champions Training

Calling all Energy Champions Defence news asked Executive Vice President Customer Services Paul Craig why he feels saving

energy is important: “The Defence Leadership Team is 100% behind this initiative. Everyone is focused on cutting costs -

but some solutions can be achieved by just flipping a switch. With very little effort required to save large costs and reduce

energy - the benefits speak for themselves.

"By following a simple checklist, switching things off or turning things down etc. before we leave our place of work every day

and especially before a longer break, we can save thousands in cash across every Defence site around the globe – so the

question is why wouldn’t we do it? We wouldn’t leave lights and lots of electrical appliances plugged in at home while no-one is

around so why do we think it is okay to do that in work? Perhaps if we all imagined the energy bill being paid for out of our own

wallets then maybe we would take a minute to switch things off before we left work.

“I have nominated myself as sponsor of a Defence Energy Charter aimed at all employees. The charter includes some key

objectives for managers in all areas and I want all managers to embrace the Charter and sign up to their requirements. A key

tool in succeeding will be the identification of Energy Champions in all areas like those pictured in Bristol recently receiving their

training certificates.”

Some of the Bristol site Energy Champions receiving their training certificates from Paul Craig.

From left: Back row: Angela Swan, Jonathan Lee, Julie Robinson, Carrie Snadden and Dave Empson. Front row: Robin Butterworth, Nick Jefferies, Paul Craig, Tracy Moore, Gary Harper

and Ashley Thurston


Energy Awareness Programme • Poster Campaign

• Workshops & Training

• Energy Champions


Easter and Bank Holiday Shutdowns

Energy consumption

for Bristol was lower

over Easter than an

average weekend

and less than half of

a normal week day.

Bristol saved around

£4,000 when compared

to a normal weekend due

to the Easter shutdown

awareness campaign.


Easter and August Bank Holiday Shutdown

Building 184A Bristol

• Cost savings for Easter and bank holiday shutdown

between £1,000 and £3,000 per day.

• Shut down at weekend saves £4,000 per weekend or

£200,000 per year.


LED High Bay Lighting Upgrade

• Savings for the first 9 months are 800 MWh or £68k.

• Forecast 2014 energy saving £95k.

• Annual maintenance saving £80k.

• Fine tuning of controls on going.

• Payback 2.8 years.


Energy Improvement to Hot Wash Tank in NDT

Cell


Detuner Covers

• Test cells have large detuner chimneys that are open to

atmosphere.

• Significant heat loss when test rigs not running.

• Install covers on detuners to limit heat loss during

periods with no testing.

• Savings £7,500/year

• Payback 1½ months


Renewables

• We are currently exploring the installation of solar PV at

our Bristol site and are proactively seeking to utilise this

technology in 2015.

• Possible locations are on the roofs of the newest

buildings 184,185 and 186.


Thank You and Any Questions


Martin Adams, DECC

ESOS presentation

Energy Savings Opportunity

Scheme

Martin Adams, ESOS Team Leader

“Cost-effective energy efficiency has the potential to deliver a triple win for businesses, the environment and the wider economy […] ESOS can support businesses in realising their energy efficiency potential” – CBI

23 Energy Savings Opportunity Scheme - Emerging Thinking

Key facts about ESOS What is ESOS?

• UK-wide mandatory energy measurement and auditing scheme

• Introduced in response to EU Energy Efficiency Directive – aims to help achieve latent cost-effective energy efficiency potential

Who must comply?

• Large undertakings and large corporate groups across the UK.

• Target highest UK-parent but allow disaggregation

And by when?

• Qualification date - 31 December 2014

• Compliance date – 5 December 2015

• Audits must be repeated every four years (i.e. second phase ends 2019)


The consultation

25 Energy Savings Opportunity Scheme: Emerging Policy Thinking

500 300

150

Met with over 500

stakeholders (and given presentations &

webinars to many more)

From over 300

organisations Received 150

written consultation

responses

Key messages from consultation Keep it simple, and understandable yet make it meaningful

• Respondents want the scheme to provide outputs that are relevant to each business

• Respondents want ESOS to add value and identify real measures that can be

implemented

Avoid duplication in existing regulation and requirements

• There a range of energy efficiency policies operating in the UK – ESOS needs to fit

• Take advantage of alternative routes to compliance – e.g. ISO50001

Minimise costs

• Allow discretion on the number of site visits required within audits

• Using internal team members for their knowledge and skills

• Only having lead auditor requiring accreditation under the scheme – but need for

whole audit team to be of sufficient quality to ensure that output is meaningful


27 Energy Savings Opportunity Scheme

0

50

100

150

200

250

300

350

400

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Estimated energy bill savings (£m) for ESOS participants, split by sector

Other Transport Industrial Commercial 1real 2014 prices

ESOS is estimated to have a £1.6bn net benefit to the UK. This will

primarily be felt by business through lower bills

Overview of ESOS

requirements


Am I part of a group

undertaking?

Do I employ 250 or

more people?

Is my turnover more

than €50m

Does the group

undertaking include in

the UK one or more

‘large enterprises’?

Is my annual balance

sheet more than €43m

AND

I am a ‘large

enterprise’

I am a ‘large

enterprise’

I am part of a

large group

enterprise

Organisations

subject to the public

contracts regulations

2006 are exempt from

the scheme

Routes to compliance


ESOS compliant organisation

Previous activity that meets ESOS standards

DECs / Green Deal

Assessments

ISO 50001

• ISO50001

• Display Energy Certificates

• Previous audits to ESOS

standards

And…

• ESOS compliant energy

assessments (either

conducted in-house or by

external assessor)

Conducting an ESOS assessment


1. Measure energy use

3. Evaluate opportunities

4. Store data and notify scheme

administrator

5. Implement savings, and

further disclosure

(e.g. in annual report)

2. Identify energy

efficiency and energy

management opportunities

Mandatory

Voluntary

32 ESOS: Next Steps

2011 2012 2013 2014 2015

Auditing activity from 6 December 2011 can be used to support

compliance for phase 1 (if approved by a lead assessor)

Key dates for phase 1

Reference period for total

energy consumption (12

months, must include

qualification date)

31 Dec

’14

Qualifi

-cation

date

5 Dec

’15

Compl

-iance

date

Use a qualified lead assessor


Professional

body Lead

Assessor

Belongs

to a…

Which is

approved by… Scheme

administrator

• PAS51215 – sets standard of competence for lead assessors (professional bodies will

ensure members meet this standard)

Registers of lead assessors


Any questions?

[email protected]

https://www.gov.uk/energy-savings-opportunity-scheme-esos

ESOS Round

table discussion

At your tables:

• agree a discussion manager/leader

• agree a recorder/time keeper

• introduce each other

Use the information sheets provided to answer

the questions on the worksheet

You have 30 minutes

We’ll share key questions with the DECC/EA

panel afterwards.

They will also be circulating among you to clarify

issues


James Tiernan

UNITE Students Business case study:

UNITE Group PLC

James Tiernan

Group Energy & Environment Manager

Unite Students’ Energy Management

Journey

• Part of The UNITE Group plc, formerly , now

• A Bristol born & based company

• UK’s biggest student accommodation provider

• Purpose is to create a Home for Success for our students & staff

• FTSE250 listed, over 1,000 employees,

• ~44,000 students bedrooms across 130 properties (wholly owned

and fund/JV owned) in 23 UK towns & cities,

• High quality, fully serviced, safe & secure accommodation

• All inclusive rent – no energy surcharge, cap or deposit

• Direct students lets, & partnerships with over 50 University

• Various building types & services strategies

• Obligation to encourage sustainable living

• Numerous drivers to reduce energy (mandatory reporting,

voluntary disclosures, stakeholder expectations, rising costs)

40

Who are Unite Students?

Utilities & Carbon Headlines

41

£0

£5

£10

£15

Elec Water Gas

Millio

ns

Annual utilities spend

(£m’s) Scope Use Tonnes CO2e

1

Accommodation: gas

5,209.7

HQ Office: gas 75.6

Company car use on work business

76.5

2

Residential: elec 50,314.5

HQ Office: elec 38.1

• Multiple drivers to cut energy & carbon

• Highly distributed consumption

• Majority of consumption under customer control

• Challenging customer engagement

Typical accommodation

42

“Cluster flat”

Shared lounge/

kitchen En-suite

bedroom

“Studio

flat”

Unite Students’ Energy Strategy

43

• Procure good value utilities

• Pay the right amount

EFFECTIVE PROCUREMENT

• Understand demand & consumption

• Reduce demand BE LEAN

• Meet demand efficiently

• Minimise wastage BE CLEAN

• Reporting, verification & certification

• Reduce Scope 3 emissions

• Renewables opportunities

BE GREEN STR

ATE

GIC

OB

JEC

TIV

ES: Bill checking,

validation & meter estate

Customer & staff

behaviour

Optimise & improve

hardware

Expand environmental/ sustainability

agenda

ACTIONS: AIM: Control & reduce energy consumption

Building types & energy usage

45

DOMESTIC HOT WATER

SPACE HEATING No. of sites

Average £/bed/yr

Elec Gas Total

Local electric immersion

Local electric 85 sites £350 £0 £350

Central gas boilers Central gas boilers 13 sites £278 £96 £374

Central gas calorifiers

Local electric 11 sites £283 £119 £402

Local gas combi-boilers

Local gas combi-boilers

6 sites £171 £219 £391

Central gas CHP & gas boilers

Central gas CHP & gas boilers

3 sites £214 £126 £340

Off site district heating & on site back up gas boilers

Off site district heating & on site back up gas boilers

2 sites £331 £0

£331

Benchmarking

46

“All electric”

District heating

Gas CHP

Central gas boilers

Gas DHW, elec. heat

Local combi-boilers

Electricity consumption per bed per year

Benchmarking

47

Focus on “all electric sites” as biggest opportunity

Variation Opportunity

Electricity consumption per bed per year

Landlord demise

Tenant demise (“behind the flat door”)

Challenges:

No standard or typical student living or occupancy patterns

Mostly small, distributed, student controlled loads; few large, central loads

Variety of building services, fabric, age, condition and location

Building Level Energy Usage

48

27%-46% of site’s total electricity

54%-73% of site’s total electricity

20%-35%

20%-25% 20%-35%

15%-30%

• Rolling out major LED lighting & controls upgrade over 2014-16

• 3 full site trial installations achieved ~20% energy savings

• Expecting ~15% energy savings across whole estate

• 30% reduction in maintenance jobs

• Significant improvement to internal lighting levels & quality

Progress made: LED Lighting

50

• Optimise settings for existing “Prefect” controllers, trialling across

4 sites, ~20% savings

• Piloting retrofit smart local & web-controlled heating & hot water

controls including presence detection

• Reduced kWh consumption

• Improved customer comfort & satisfaction

• Peak demand shedding: Triad & red DUOS avoidance

Progress made: Heating & DHW Controls

51

Progress made: Student & Staff Behavioural Change

• Looked at numerous different student engagement approaches

(“Carrot”, “Stick” and competition)

• Trialled various off-the shelf programmes

• Recruited in house expertise and have developed and

launched major customer & staff engagement initiative

52

• Called “Up to uS”

• Bespoke programme to encourage responsible

living habits

• Focus on reducing energy & water use,

increasing recycling, and general sustainable

living, incudes NUS “Green Impact” scheme

• Includes national, local and individual levels to

drive behavioural change

• Very difficult to quantify savings, but expect 5%

- 10% reduction

• 3rd party verification of energy & carbon data reported

• Rolling out hot-water saving measures

• About to install 1,000 energy & water saving shower heads,

specially selected to balance customer expectations over

energy/water savings, while also preventing lime-scale and

biofilm

• Developing ISO14001 ready EMS

• Planning for ISO50001 based EnMS

• Use Sustainability Champions in buildings to identify local

opportunities

Coming soon…

53

Lessons learned

• Structured approach vital to keep on track

• Understand & prioritise opportunities & solutions yourself

• Make targeted use of external support to achieve specific aims

• Customer satisfaction is critical

• Support & buy-in from senior management & building

operations teams is key

• “A good plan today is better than an excellent plan tomorrow”:

Need to be flexible & ultimately actions are what count

54

• Definitely an opportunity

• Undertake data collection & survey that would be difficult to

justify otherwise

• Combining ESOS & compliance with the Minimum Energy

Efficiency Standards (MEES) for EPCs to minimise costs

• Collect accurate & useful data to inform future energy strategy

• Capture data in an accessible & usable format

• Target the “outliers” with most significant potential savings

• Drive towards ISO50001 for subsequent phases

Our take on ESOS

55

Thank you

Any Questions?

James Tiernan BSc MSc IEng MIE ACIBSE

Group Energy & Environment Manager

Unite Students

[email protected]

0117 302 7115

56

mailto:[email protected]




Miles Alexander

Green Investment Bank Financing for Energy

Efficiency

Financing for Energy Efficiency

Miles Alexander

Head of Commercial & Industrial Energy Efficiency

UK Green Investment Bank plc

59

AGENDA

1. GIB Introduction

2. Energy Efficiency

3. Financing for Energy Efficiency

4. Case Studies

5. Conclusions

6. Questions and Answers

60

GIB Introduction 1

61

£3.8bn Capital to invest

in green projects

WHO WE ARE

70 Specialist investors

and technical experts

Chaired by Lord Smith

Independent Board

100% Owned by the

UK Government

Mobilise

private sector

investment

Accelerate the

UK’s transition to

a green economy

62

OUR JOB

Our vision: green and profitable Our task: crowding-in capital

Our markets:

Offshore

Wind Waste &

Bioenergy Energy Efficiency

63

We have invested in every

part of the UK, in all of our

sectors and using all our

financial products

WE ARE INVESTING

Our investments will save 1.3

million tonnes of waste from

landfill

We have backed 6 local

authority, 3 commercial and 4

anaerobic digestion waste

projects

We have backed large and

small projects; from a

CapEx of £2m

to £1bn

We are building a market in

energy efficiency, including

streetlight conversion and 4

NHS projects

Our investments will produce

enough renewable electricity

to meet energy needs of 2.9

million homes

We’ve invested £623m

in 5 offshore wind

projects, including

construction equity

We have set up 5 funds,

with £250m, to back

small projects

Our investments will cut CO2

emissions equivalent to

taking 1.5 million

cars off the road

We have committed £1.4bn of capital to 35 projects, mobilising a total of £4.9bn

64

Energy Efficiency 2

65

ENERGY EFFICIENCY OPPORTUNITY

THE ENERGY EFFICIENCY

OPPORTUNITY

Cost Savings

Sustainability UK Plc

UK businesses can reduce

their energy bills by 15%, or

£1.6bn per annum

Socially cost-effective

investments can save

196TWh in 2020,

equivalent to 22

power stations

£17.6bn UK sales in 2011

– forecast to grow 5% pa

Currently accounts for

136,000 UK jobs;

potential to create

>300,000 new jobs

Sources: CBI: Shining a Light; Energy Efficiency Deployment Office; Lavery/Pennell; Westminster Sustainable Business Forum

66

ENERGY EFFICIENCY DRIVERS

Source: McKinsey, Lavery Pennel, ECUK,DECC – Energy Efficiency Strategy, GIB

Drivers

Energy Efficiency is underpinned by strong and sustainable drivers

Industrial

Competitiveness

Sustainability

• UK energy efficiency target of 20% reduction by 2020

• Increasing energy prices & volatility

• Technology improvement leading to significant cost reductions & improved payback profiles

• Companies can see cost reductions versus competitors due to reduced energy usage

• Differentiating brands through focus and proven delivery of sustainability

Regulation

Energy Prices

Technology

Development

67

GIB EE TECHNOLOGY CLUSTERS

ONSITE GENERATION BUILDING

RETROFIT

INDUSTRIAL

PROCESSES

BMS/ Voltage

optimisation

HVACs

Wall Insulation

Replacement

glazing

Boiler/Chiller

Upgrade

Indoor & other

lighting

Municipalities

Hospitals

Hotels

Universities

Offices

Ground

Source Heat

Pumps

Air Source

Heat Pumps

Biomass

boilers

Municipalities

Hospitals

Retailers

Supermarkets

Universities

Leisure

CHP

Mini-CHP

Hospitals

Hotels

Universities

Offices

Street

Lighting

Other

Outdoor

Lighting

Lighting

Controls

Hospitals

Municipalities

Retailers

Airports &

Stations

Car parks

Furnace

insulation &

upgrade

Process

control/opt.

Reactor

upgrade

Variable Speed

Drives

Motors

Pumps

Waste heat

recovery

Power mgt syst.

Chemicals

Food &

Beverage

Mineral

Products

Paper &

Publishing

Comms

networks

Smart meters

Data

management

Grid storage

District

Heating

Utilities

Telecoms

Meter Asset

Providers

Communicati

on Hub Asset

Providers

GIB focuses on seven energy efficiency technology clusters

INFRASTRUCTURE

Transport

infrastructure

Hybrid/

Electric

vehicles

Charging

infrastructure

Rolling stock

Municipalities

Retailers

Logistics

Transport

service

providers

Renewable

Heat

EXAMPLES

EXAMPLE

CUSTOMERS

CHP Efficient

Transport Smart Grid

Outdoor

Lighting

68

Financing for Energy Efficiency 3

69

GREEN FINANCING OPTIONS

Number of financing methods for sustainable projects

Company

cash flow

Corporate

(green) loans

Green bonds

Off balance

sheet

financing

Energy

Service

Companies

Purchase

power

agreements

• Use existing company

cash resources

• Often used but tends to

lack long-term

sustainability strategy

• Bank cash flow loans,

asset financing,

mortgages

• New funding for green

projects eg Sainsbury’s

Green Loan

• Expanded from utility

green bonds to wider

branding including

consumer focused

companies (eg

Unilever)

• Special Purpose

Vehicle established to

reduce risk to company

but at a higher cost

• Difficult to establish for

embedded technology

• ESCO takes on

implementation risk and

guarantees savings

• Ability to also provide

bank financing

• Ability to buy-in green

power but only off-

setting carbon

reduction rather than

self-reducing CO2

70

GIB FINANCING OPTIONS

GIB can finance a wide array of green projects with flexible capital

GIB Funding

£3.8 billion of UK Government funding

GIB funding is on commercial terms

Focus on opportunities with £10m+ of

funding requirement (can be across

multiple projects)

GIB can invest much longer than other

banks (25+ years)

Can invest across the capital structure,

providing equity or debt or a hybrid, with

low or no equity from host company

GIB has the ability to sculpt return

profile so that savings pay for the

investment

Independent investment committee

Focused mandate allows for efficient

investment process

Supportive senior management

Benefits of working with GIB

GIB brings green and finance credentials,

as well as government backing with long-

term perspective

GIB can engage early in a project to

develop the opportunity, leveraging know-

how and contacts

Flexibility for host to have operational

involvement or be at arms length

GIB is willing to work through difficult

situations to support project execution

GIB has strong financial, industrial and

technical skillset and wide contact base

Focused mandate allows for an efficient

investment process

71

GIB BACKED EE INVESTORS

• Non-domestic energy

efficiency within the

NHS

• Expected average

project size of £5m

• Energy efficiency

saving measures which

offer an annualised

reduction in GHG

emissions during the

lifetime of the financing

• Includes biomass,

CHP, medical waste

incineration, lighting,

VSDs, heat recovery

• £2.2m investment to

fund installation of a

CHP unit at

Cheltenham General

Hospital

Focus

Investment

criteria

Technologies

• Non domestic energy

efficiency

• £500k to £30m of

required capital


saving measures

which offer an

annualised reduction

in GHG emissions

during the lifetime of

the financing

• Building retrofit,

infrastructure

improvements, district

heating, renewable

energy, industrial

energy efficiency

• £0.4m equity

investment to fund

retrofit of a Kingspan

warehouse. Revenues

are based on a share

of energy cost savings

• Asset financing

• GIB-DLL Syndication

Alliance focus on NHS

• Asset financing of all

equipment sizes

• GIB-DLL Syndication

Alliance minimum of

£1m and maximum of

£25m loan value

• Energy efficiency saving

measures which offer an

annualised reduction in

GHG emissions during

the lifetime of the

financing

• Includes CHP, lighting,

building management

systems, VSDs


fund CHP upgrade,

boiler upgrade, LED and

building management

systems at Queen’s

Medical Centre

• Non domestic energy

efficiency

• £500k to £30m of

required capital


saving measures

which offer an

annualised reduction

in GHG emissions

during the lifetime of

the financing

• Biomass to heat,

CHP, district heat,

building retrofit, EPC,

smart metering


fund the installation of

a biomass boiler at

Tomatin Distillery near

Inverness

Project Size

Financing

example

• Asset financing

• Public and private sector

• Asset financing of all

equipment sizes

• GIB-SGEF Syndication

Alliance minimum of £2m

and maximum of £20m

loan value

• Energy efficiency saving

measures which offer an

annualised reduction in

GHG emissions during

the lifetime of the

financing

• Includes CHP, boilers,

building retrofits, lighting,

and energy reduction

technologies for

production processes

• £5m investment to fund

the installation of a CHP

unit, dual fuel boilers,

biomass boilers and

effluent treatment at

Rampton Hospital

72

OTHER ENERGY EFFICIENCY FINANCIERS


efficiency within SMEs,

aiming at turnover >

£25m

• £200m Carbon Reduction

Fund through

government’s funding for

lending scheme

• Through RBS’s

partnership with Mentor,

businesses are offered

energy efficiency audits

(£1,000 cost)

• RBS offers financing to

cover audit

recommendations, with

1% reduction on standard

rate of interest and covers

the costs of any

associated fees, including

cost of the initial audit

Focus


efficiency equipment with

project size > £1,000

• Independent carbon

saving assessment is

undertaken by Carbon

Trust Implementation

Services, with financing

provided by Siemens

Financial Services

• Financing can be

arranged directly by the

customer or through the

scheme’s recognised

suppliers

• Suppliers are able to

apply to become

recognised, enabling

them to combine

financing with product

sales

• Financing payments are

offset by anticipated

energy savings

Financing

• SME lending

• Corporate ‘green’ loans

• Lloyds financed with

Rabobank the first ever

corporate ‘green’ loan

(£200m loan to

Sainsbury’s)

• Structure is consistent

with Green Bond

Principles 2014

• Loan accredited as green

and independently

monitored by

Sustainalytics

• Eligible projects include

renewable energy, energy

efficiency, water use

management and carbon

reduction

• Business loans across the

SME to corporate

spectrum

• Many other providers of

capital including high

street banks which will be

familiar with different

lending options and can

provide face-to-face

contact for businesses

• Corporate/commercial

divisions provide

dedicated relationship

directors to give advice

• Lending to fund energy

efficiency projects

supported by a sound

business case could be of

interest to these and other

lenders

• Energy audits should help

support SMEs in building

their business case

73

Case Studies 4

74

CASE STUDY: KINGSPAN WAREHOUSE RETROFIT

Finance

• It is structured as a fully equity funded energy services

agreement, requiring no capital investment from Kingspan

• Revenues are based on a share of measured and verified

energy cost savings

• The Pari Passu co–investor

• Mobilisation 1:1

Summary

• The UK Energy Efficiency Investments Fund ‘UKEEI’,

which is cornerstoned by GIB, has committed to a

£0.4m equity investment to fund the retrofit of a

Kingspan warehouse in Wales.

• The investment provides 100% of the funding

required to retrofit its Holywell insulated panel

manufacturing facility factory to reduce energy

demand and creates cost savings through lighting,

compressed air and extraction fans, metering and

motor replacement.

75

CASE STUDY: TOMATIN DISTILLERY BIOMASS BOILER

Finance

• It is fully equity funded, with shares and a subordinated loan

note agreement

• Revenues will be generated by the sale of heat, lease payments

and the receipt of RHI

• The Pari Passu Co-investor is a parallel Fund raised by Equitix

• Mobilisation 1:1

Summary

• The Energy Saving Investment Fund ‘ESI’, which is

cornerstoned by GIB, has made an investment of

£0.6m for the financing of the installation of a biomass

boiler at Tomatin Distillery near Inverness

• The boiler installation produces heat for the steam

utilised in the production of whisky. The boiler

replaces a high maintenance, inefficient oil fired

boiler. The new boiler will replace 80% of the heat

load usually generated by the oil fired boiler.

76

CASE STUDY: GIB GREEN LOAN

Assistance in business case development including up to

£0.5m Starter Loan to fund costs

Green Loan funding covers LEDs, CMS, column renewal

and other project costs

Fixed rate funding with interest paid only on amounts

drawn

Repayment profile can be sculpted to forecast energy

efficiency savings (see below):

Potential to blend with other sources of finance

Certainty of programme funding or the Authority

Confidence for new EE ‘spend to save’ programme

GIB technical, legal and financial due diligence and on-

going green monitoring

Compatible with variations to PFI projects without the

need to alter existing funding in the PFI SPV

77

Conclusions 5

78

CONCLUSIONS

• Energy efficiency projects are a means to making your business more robust

• Saves energy … which saves money

• Saves resources … which can be better used to grow your business

• Saves carbon emissions … which enhances your position with your stakeholders

• Energy efficiency can be funded from many sources

• Your own cash which will be paid back with upside returns from the savings

• Your bank or third party funding

• Government incentives

• Energy efficiency needs companies to prioritise it

• Dedicate resources to identify, build the business case and implement the EE projects

• Reward employees to drive the energy efficiency projects

• Energy savings will be a source of future capital and dividends

Financing should not be a barrier to grabbing your energy efficiency opportunity

79

Questions & Answers 6

80

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CONTACT US


Andrew Garrard

Bristol 2015

Amy Robinson

Low Carbon South West

Go Green and Bristol

2015

Our journey so far Long journey to make Bristol the UK’s greenest city, with many landmarks.

The Green Capital aspects are:

• 2003 Community Strategy:

“Bristol; a green capital in Europe – creating sustainable communities and improving the quality of life.”

• 2007 Bristol Green Capital Partnership founded

• 2008 European Green Capital Award created

• 2013 Bristol awarded European Green Capital 2015

European Green Capital Award

Awarded to a city that:

• Has achieved high environmental standards;

• Is committed to ambitious goals for sustainable

development;

• Can act as a role model to inspire other cities.

Technical Assessment and Independent Evaluation

Stockholm

Nantes

Hamburg

Vitoria

Copenhagen

Why Did We Win? • Many years of pioneering

environmental efforts

• Strong performance across 12 categories versus other competing cities

• Strong community action and effective partnerships

• Ambitious and real investment in the future

• Exciting plans for 2015

• Sense of fun!

The Organisations • Bristol Green Capital Partnership

– The UK’s largest city green network – over 500 organisations are members

– Democratic structure with Chair and Steering Group elected by members

– Focused on helping make Bristol a more sustainable city

• Bristol 2015 Ltd – Independent Board including Mayor and Chair of Partnership

– Focused on securing funding, planning and orchestrating the 2015 programme

• Bristol City Council – Key roles in supporting and contributing to 2015 programme and managing

relationships with UK Government etc

– Focused on delivering our major projects, managing Neighbourhood and Strategic Grants and ensuring lasting impacts of year

The Organisations • UK Government

– Both Treasury and DECC have supported the commitment of funding to Bristol 2015

– There is cross Government Department interest is supporting Bristol with Bristol 2015 as a catalyst

• Commercial Partners – Strong private sector support through significant cash and in-kind commitments.

On-going sponsorship discussions across a number of categories

• Strategic Partners – Important strategic and resource support

– Partners include the Universities, BusinessWest, Low Carbon Southwest, and Destination Bristol

To become a global leader

in sustainable urban living

Local Empowerment

Empower existing initiatives, networks and

communities to help change attitudes and

behaviour.

Sustainability

Leadership

Exchange sustainability expertise between

cities and contribute to the 2015 UN climate

change negotiations.

International Profile

Build Bristol’s global profile to support

appropriate exports, inward investment,

tourism and economic growth.

Bristol’s Vision

Goals for Bristol EU Green Capital 2015

Reinforce

the

necessity of

sustainable

living

Nature

Shared responsibility to create

healthy and happy cities

Food

Energy

Resources

Transport

Education Arts & Culture

Fun New Economy

Built Environment

Health

Bristol 2015

Bristol 2015 Programme

Volunteer

Programme

Grant

Funded

Projects

Major Event

Programme

Official

EU

Events

Business

Go

Green

Visiting

cities and

businesses

Partner &

Community

Projects

Bristol

City

Council

Commissions

Local Empowerment

• Bristol 2015 Grants Scheme - £2m

– Neighbourhood Partnerships

– Small Grants Programme

– Strategic Grants Programme

• Volunteering Programme

• Bristol Welcome

• Go Green Business Engagement

• Arts Council Exceptional Award

International Profile

• Bristol Debates and International Summits

– Politics and the Environment

– Young People

– Business

– City Leaders

• Green Tech International Festival

• International Fair Trade Towns Conference

• Bristol attendance at key international events

Sustainability Leadership

• International Delegations to Bristol

• European Commission Events

• European Green Capital Network of cities

• UN Conference on Climate Change – COP 21 (Dec 2015)

• Eurocities Environment Forum

• National Schools Programme

• Bristol Method

Engaging local business

• Go Green

• Adding your own events

• Dating agency

• Maximise inclusion

Monday 29th September, 2014

Changing the Narrative

Amy Robinson

Network Director, Low Carbon South

West

10th November 2014

Delivered by: Supported by:

“Supporting the Low Carbon Sector”

• Membership organisation and CIC

• sector partnership between businesses, academia, investors, local authorities and national agencies

• Over 3000 in the network

• Devoted to building the Low Carbon economy in the South West


• Originally established by Forum For The Future

• Started in 2009

• A network of businesses, NGOs and public sector organisations committed to a reducing their carbon emissions.

• Members signed a declaration of intent and reported on their carbon impacts

• Peer to peer learning and networking events


Why LCSW is involved with WECC


Some of our members


What has changed?


Go Green - What is it

• Collaboration between LCSW and Business West

• Programme of events and bespoke web-tool

• Open to businesses of all sizes

• Supporting businesses however ‘green’ they are

• Easy to get involved

• With a straightforward way to identify strengths and areas for improvement


Why?

• There is a huge range of advice but it can be difficult to navigate

• One-front-door that will signpost to valuable resources and advice

• Does not reinvent the wheel – promotes existing schemes, projects and opportunities

• Tailor-made web platform enables:

– Businesses to prioritise their activities and track and report on their progress

– Us to collate information and report on overall progress of members

• The advice will be tailored to reflect size, location and prior progress

• Creates opportunities to learn from others and share success stories

• Provides a brand that helps businesses to demonstrates their commitment to improve


How does it work

TRA

VEL &

TRA

NSP

OR

T

ENER

GY &

EFFICIEN

CY

PR

OC

UR

E & P

REPA

RE

HA

PP

Y & H

EALTH

Y

RESO

UR

CES &

R

ECYC

LING

PLEDGE

ACCREDITATION + MEMBER CSR CONTRIBUTION ( prove what you are doing + help others to do the same )

SAY IT

DO IT

PROVE IT


Get Involved

Register your interest:

www.gogreenbusiness.co.uk

[email protected]

http://www.gogreenbusiness.co.uk/






Dr Philip Douglas

DECC The UK landscape of

business energy

efficiency policies

Introduction to the

business energy efficiency

policy landscape

Dr Philip Douglas Head, Energy Efficiency and Community Energy Strategy, DECC

Energy efficiency, decarbonisation and growth

110 Introduction to the business energy efficiency policy landscape

“The choice between going green and going for growth is a false choice. Green and

growth do go together, and the statistics back this up”

The Colour of Growth, CBI, July 2012

"...make no mistake we are in a global race and the countries that succeed in that race,

the economies in Europe that will prosper, are those that are the greenest and the most

energy efficient."

David Cameron, Energy Efficiency Mission launch, 4 Feb 2013

Energy efficiency belongs at the heart of a low-carbon economy. By reducing energy use

and cutting down on waste, we can reduce energy bills, make our energy system more

sustainable, and drive down greenhouse gas emissions.

Edward Davey, Secretary of State

“Large UK businesses are paying out more than £1.6bn too much on their energy bills

every year because many are yet to seize the full opportunity

to cut bills by around 15% through energy efficiency measures”

Carbon Trust, The Business of Energy Efficiency, October 2012


“We estimate that through socially cost-effective

investment in energy efficiency we could be saving

196TWh in 2020, equivalent to 22 power stations”

The Energy Efficiency Strategy: a mission to realise the

UK’s Energy Efficiency potential


Embryonic Markets

Misaligned financial

incentives

Information

Under-valuing energy

efficiency

The policy landscape


Pro

duct S

tandard

s

CR

C CCL &

CCAs ESOS

EU

ETS

GHG

Reports

EDR

Green

Govt. Salix

Green

Invest.

Bank

Re:Fit

Green

Deal

Build

ing re

gula

tions

EP

Cs

Smart

meters

DECs Public sector

Business

Domestic

Standards

Information

Financing

Taxation / Trading Schemes

ECO

A key challenge is ensuring that policies

complement each other… and then

effectively communicating that…

ECAs

ESOS

CRC

EU ETS & CCAs

Key business energy efficiency policies

have different primary targets


Covers all large and

smaller non-SME

enterprises

Energy intensive

industry – site based

Less energy

intensive commercial

organisations (major

energy users)


Power Plant Installation – EU ETS

All elements will be

covered by ESOS if part

of large UK enterprise

Head Office - CRC

Chemical Facility –

EU ETS & CCA

Chemical Facility

off-site offices –

CRC Car showrooms - CRC

Packaging Plant -

CCA

Policy Simplification I: Overview, CRC &

ESOS

• DECC has taken steps to simplify our policies to reduce overlap and

administrative burdens on industry

• CRC simplifications have delivered a 55% reduction in admin costs, saving

participants around £275 million up to 2030

• ESOS allows flexibility to organisations to choose their 12 month period of

energy data collection, so data gathered under existing schemes can be

used for their energy audits.


Policy Simplification II: CCAs and EUETS

• The simplified CCAs scheme removed any overlap with EU ETS as well as

simplifying overlap with the CRC Energy Efficiency Scheme

• We have simplified EU ETS through a more proportionate and consistent

penalties system and improving the independence and efficiency of the

appeals process

• A small emitters and hospitals EU ETS opt out offers 247 installations an

estimated £39million in savings between 2013 and 2020 while maintaining

environmental incentives



The current policy package is on track through to 2020 but additional

action is needed to maintain progress after 2020.

Carbon Plan scenarios require energy

efficiency to contribute a reduction in

final energy consumption per capita

between 2011 and 2050 of 21-47%

We invite your feedback


How do we collaborate to cost-effectively achieve more energy

efficiency?... In the policy mix…

1. What is helping energy

efficiency?

2. What is hindering energy

efficiency?

3. What is missing that is

needed to drive more energy

efficiency?

Wider landscape

table discussion

At your tables:

• agree a discussion manager/leader

• agree a recorder/time keeper

• introduce each other

Use the information sheets provided to answer

the questions on the worksheet

You have 30 minutes

We’ll share key questions with the panel

afterwards.

They will also be circulating among you to clarify

issues

Thank you

DECC Energy Savings Opportunity Scheme (ESOS) South West Launch - Bristol - 10th November 2014

Environment

energy awareness campaign

strategic energy partner

energy conservation

energy champion roles

business reduction target

recent global energy

key business opportunity

areas of defence business