Creating standard protocols to unlock new investment opportunities for small projects
BARCELONA, Spain, June 29 2016 – The Sustainable Energy Asset Framework (SEAF) unveiled a new IT platform to energy efficiency contractors, investors, and Energy Service Companies (ESCOs) from across Europe at Investor Days Barcelona, an event hosted by the Investor Confidence Project and SEAF. The June conference brought industry leaders together to discuss market barriers to scaling small and medium-sized energy efficiency projects. Standardized project protocols, risk assessment, and matching contractors with investors will help unlock access to financing and deal flow and tap into the €8 billion market.
Unlocking Value: Investors embrace SEAF as an Inflection Point for the European EE Market
Holding billions in untapped payback value, the European energy efficiency sector remains a high-potential yet largely underutilized market resource. At the inaugural Investor Days Barcelona event, industry innovators gathered to pinpoint current market barriers and to discuss new high-yield investment opportunities that are now possible within SEAF guidelines:
Sebastian Carneiro, Director, Sustainable Investment, SUSI Partners AG: “From an investor’s point of view, the European energy efficiency market is immature. Lack of standardized project structures, valuation, and risk assessment present major hurdles to attracting capital from institutional investors.”
Lada Strelnikova, Investment Advisor of the European Energy Efficiency Fund: “Energy efficiency is still an unknown universe for the investing community due to non-existing benchmarks for cash flow projections, lack of standards for technical solutions, and few implemented projects of reasonable size to raise investors’ confidence. It is sexier to invest in renewables than in boilers’ replacement, but it is also smart to invest in street lighting upgrades which with cutting edge technology is beneficial for all stakeholders.”
The SEAF IT Platform: A Way to Scale European EE Investment Securely and Effectively
In response to the complex nature of energy conservation systems and an increasing number of ESCOs managing implementation of energy savings measures, the SEAF consortium has created an approach involving underwriting the performance of energy savings measures to achieve credit risk reduction, thereby removing technical uncertainty for lenders and investors. Insuring the performance of projects with a highly rated insurer helps reduce financial exposures and results in increased credit worthiness, lower interest rates, and reduced financing costs.
The SEAF IT platform integrates Joule Assets’ project Valuation and Optimization tool with internationally recognized Investor Ready Energy Efficiency (IREE) standard protocols from the Investor Confidence Project (ICP) and performance-based Energy Efficiency Insurance from Hartford Steam Boiler (HSB), a global leader in equipment insurance and part of Munich Re.
“By mitigating technical risk, the provision of HSB’s Energy Efficiency Insurance will help deliver increased customer and investor confidence in projects,” said Paul Cullum, Product Development Manager at HSB Engineering Insurance.
“By giving ESCOs access to financing and HSB’s performance-based insurance, SEAF is helping transform the energy efficiency market in a meaningful and scalable way,” said Antonio Ciccarelli, CEO of Italian ESCO SEA Servizi Energia Ambiente. “It ultimately streamlines and unlocks energy efficiency investment opportunities in the small-to-midsized sector while helping ESCOs focus on core business.”
“We expect SEAF to help capital markets value energy efficiency as a predictable yield generator, ultimately driving down the cost of capital,” explains Jessica Stromback, Chairman of Joule Assets Europe. “As a result, we anticipate more deployment of competitively-priced capital flowing into a growing base of energy efficiency investment opportunities. This will enable us to scale cleaner, more efficient technology and reduce greenhouse gas emissions. The IT platform will also provide matchmaking between contractors and investors, further unlocking deal flow to make Europe a cleaner, greener place.”
About SEAF: SEAF is a two-year H2020-funded project that kicked off in February 2016 and is actively seeking stakeholders to participate in the development of the IT Platform. For information on how to join the stakeholder group, contact Caroline Milne, Joule Europe GM and SVP here.
About SUSI Partners AG: SUSI Partners is a Swiss Investment Advisor with 44 full-time investment professionals located in Zürich, Frankfurt and Luxembourg. As specialized investment manager, SUSI offers tailor made financing solutions and framework agreements for ESCOs to enable third party funding for energy efficiency projects. www.susi-partners.ch
About the European Energy Efficiency Fund: The European Energy Efficiency Fund (EEEF) was established in 2011 to operate with the mission ‘Advancing Sustainable Energy for Europe’, while mitigating climate change through financing of energy efficiency measures in the public sector, small-scale renewable energy and clean urban transport projects. www.eeef.eu
About Joule Assets Europe: Joule Assets Europe is a fully owned subsidiary of Joule Assets, actively empowers businesses, communities, and investors to capitalize on energy innovation, sustainability, and regulatory policy in the U.S. and Europe. Through a combination of market intelligence, project expertise and novel financing solutions for energy efficiency and demand management initiatives, Joule enhances the value of projects by generating and integrating new value and revenue streams. Each of Joule’s business units: Joule Financing, Joule Energy Services and Joule Community Energy support the overarching mission to develop, enhance, improve, and catalyze the energy efficiency markets. You can learn more about Joule Assets at: http://www.jouleassets.com/ or apply for a consultation here. You can also follow us on Twitter @JouleAssets.
About Investor Confidence Project (ICP) Europe: ICP Europe is developing a suite of Commercial and Multifamily Energy Performance Protocols that aim to reduce transaction costs by assembling existing standards and practices into a consistent and transparent process. The purpose of ICP Europe is to enable a marketplace for building owners, project developers, utilities, public programmes and investors to trade in standardised energy efficiency projects. http://europe.eeperformance.org/
About SEA Servizi Energia Ambiente: SEA is an ESCO and engineering firm, which offers energy efficiency solutions in the industrial, residential and service areas. SEA also proposes investments to reduce consumption, thus freeing the customer from the initial expense and dividends over time the savings. http://www.sea.aq.it
About HSB Engineering Insurance (HSB): HSB Engineering Insurance, as part of Munich Re, is a leading specialist provider of engineering insurance and inspection services. HSB helps clients reduce risk through a range of innovative engineering insurance products tailored specifically for the renewable energy, construction and manufacturing industries, as well as for the general retail, commercial and public sectors. HSB is the UK-based arm of Hartford Steam Boiler, one of the world’s leading equipment breakdown insurers. www.munichre.com/HSBEIL
Caroline Milne, Communications Associate, Joule Assets