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New risk assessment and benchmarking tool to scale up investments in Energy Performance Contracting

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A pool of international experts has developed an innovative methodology to support the development of energy efficiency and sustainable energy investments in the tertiary sector.

 

 

There is significant energy efficiency potential in Southern Europe’s tertiary sector. However, the lack of a standardised approach towards developing and evaluating investment opportunities and high transaction costs stemming from the use of inconsistent risk assessment and energy savings quantification approaches often hinder access to third party financing, which is necessary for Energy Performance Contracting (EPC) based investments.

 

The EPC approach can support commercial real estate and tertiary sector actors in reducing long-term operating costs, thereby improving asset value and sustainability, without utilising their own capital or debt structure or relying on the services of highly specialised energy efficiency equipment and services providers. While such an approach is particularly valuable for owner-occupied properties such as hotels, hospitals and restaurants, EPC projects also benefit commercial centres and other tertiary sector facilities where the owner is not the occupier.

 

A new investment assessment and benchmarking tool, based on the existing Green Rating™ methodology developed by Bureau Veritas, is now available to support the development of EPC opportunities. With its standardised building renderings and models of over 40 technical energy saving and generation measures, the Green Rating™ investment assessment and benchmarking tool will foster common understanding of EPC project risks and benefits, thus improving transparency and trust in the potential returns among all investment stakeholders.

 

The tool can be used by real estate and tertiary sector actors to identify and prioritise energy savings measures as well as building renovation opportunities, therefore easing access to third party financing provided by organisations such as banks, funds and utilities. In fact, these organisations can leverage the tool to identify and assess risks and to evaluate each technical measure and equipment involved in the investment. The tools’ value lies in its standardised approach and in the fact that its application is certified by an independent third party such as Bureau Veritas.

 

The tool and methodology have been developed within the international initiative Trust EPC South, co-funded by the European Commission’s Horizon 2020 programme. The initiative, which is coordinated by the Spanish firm Creara and made possible by the collaboration of nine partner organisations representing Croatia, France, Greece, Italy, Portugal and Spain, leverages the aforementioned tool and methodology to unlock the significant potential for EPC investments and to create dialogue between the tertiary sector and real estate stakeholders, financing parties and the energy efficiency services sector in each participating country.

 

The Trust EPC South consortium is currently reaching out to financial institutions interested in investing in the energy efficiency and sustainable energy fields, and seeking investment opportunities in which to test the new tool.

 

 

For further information, please visit the relevant European Council for an Energy Efficient Economy (eceee) webpage at the link below.