ESCOs: key partners to achieve an energy transition (Spanish ESCO market)

Transcription

1 ESCOs: key partners to achieve an energy transition (Spanish ESCO market) BOOSTING LOW CARBON INNOVATIVE BUILDING REHABILITATION IN EUROPEAN REGIONS Vilnius, January 17th, 2018

2 Growth of world economy requires an increase of energy consumption. In the next two decades this consumption is foreseen to increase 30% Energy Efficiency is the main driving force for decoupling economic growth and energy consumption Between 1995 and 2015 the global GDP growth was 73% and the energy consumption 50%. This consumption would have been 14% higher without energy efficiency measurements implemented Energy Efficiency investments in 2015 increased in $ millions (6% more than in 2014), 2/3 higher than in power generation (IEA 2016) Energy Services Market has become a reality of $ millions of business volume world wide 2

3 1. ESCO Model 2. ESCO Market in Spain 3. Anese Contribution

4 1. ESCO Model

5 Energy Service European Directive of Energy Efficiency 2012/27/UE. Art. 2 Definitions the physical benefit, utility or good derived from the combination of an energy with an energy-efficient technology or with action, which may include the operations, maintenance and control necessary to deliver the service, which is delivered on the basis of a contract and which, under normal conditions, has been shown to achieve a verifiable and measurable or estimable improvement in energy efficiency or primary energy savings 5

6 What are the Energy Service Companies, ESCOs? Companies providing energy efficiency improvement services... facing some risk in doing so, and basing the payment of their services provided in obtaining energy savings Definition of ESE or ESCO, according to Directive 2006/32 / EC and article 19 of RD 6/2010: A natural or legal person who provides energy services or improves energy efficiency in a user's premises and faces some degree of economic risk in doing so. The payment for the services provided will be based (either wholly or in part) on the achievement of improvements in energy efficiency and compliance with other agreed performance requirements. 6

7 ESCO Model: energy saving guarantees Costs and savings[ ] INICIAL COST FOR CUSTOMER Energy Costs INVESTMENTS ESCO Contract Savings for Customer Investment payment ESCO fee Costes energéticos Energy Costs Final Cost for Customer Savings for Customer Energy Costs 7 a 0 a 1 / / a n a n+1 Years 7

8 ESCOs: Value proposition The ESCO guarantees the energy savings of the project The ESCO provides the financing of the investment Savings Guarantee Energy Services Financing Tecnology The ESCO identifies, designs and implements the Energy Efficiency Measurements PMO Skills Financing Skills Technical Skills Legal Skills 8

9 FIRST ADDED VALUE: ESCOs use mature technologies that provide energy efficiency Energy Savings Heat-pumps and chillers with heat-recovering Condensing boilers and micro-cogeneration Outdoor LED lighting Photovoltaic and thermal solar systems Efficient electric motors Variable Speed Drives Solar films in windows Roof and facade isolation Building Energy Management Systems (BEMS) Charging stations for PHEV & EV Presence detection and efficient lighting control systems in parking lots Daylighting, Low-consumption and LED lights 9

10 SECOND ADDED VALUE: ESCOs incorporate financing to the project, based on savings Economic Savings 1 Technologies and Energy Services Guaranteed savings 4 Client 3 Management fee The client doesn t use his financing resources 2 Project financing out of balance ESCO 10

11 THIRD ADDED VALUE: The technical and financial proposal is presented on a contract where the savings are guaranteed 1. Energy Performance Contract (EPC): savings in kwh CONTRATO DE AHORROS GARANTIZADOS CONTRATO DE AHORROS COMPARTIDOS 2. Energy Supply Contract (ESC): savings in /kwh supplied 11

12 2. ESCO Market in Spain link Observatorio

13 Size and location of ESCOs. Anese 2015 survey (74/56 enterprises) Revenues (mill. ) 85% of ESCOs are SMEs 21% have revenues over 10 mill Most of them are in Madrid Madrid 38% Cataluña 15% Andalucía 10% Size by no. workers 29% operate across Spain 34,5% work abroad (78% of them are SME) Small Medium Large 13

14 ESCOs achieve energy savings and provide qualified employment during 8 years ESCO achievements in Spanish market Energy Savings Emission Savings Economic Savings ESCO profile as per survey Implemented technologies Industrial applications Types of contracts (No. ESCOs) Guaranteed savings (EPC) Building envelope Shared savings (EPC) Lighting Mixed savings (EPC) Motors Energy supply contract (ESC) Control systems Integrated energy contract (5P) HVAC systems Average amount of an ESCO contract Own contract Average duration of an ESCO contract: 7,6 years 14

15 ESCOs contribution to national targets ESCOs provide 20,000 direct employment with high qualification Contribute with a 0.11% to the GDP (1.170 M revenues) 35,9% of 2015 annual target of the National Plan for Energy Efficiency has been achieved by ESCO projects 15

16 Public tenders for energy services Number of tenders Public issues had big impact in the number of tenders in Average Budget (Mill ) Street Lighting 3,4 1,5 1,3 HVAC 1,6 0,5 1,0 Others 1,8 2,7 1,4 16

17 Market segmentation There is no clear specialization by sector or industry Market Segment ESCOs % Local councils street lighting 44% Local councils schools 39% Public Local councils sport centers 37% Public administration - Buildings 35% Public administration - Hospitals 21% Public administration - Universities 16% Industry 65% Private Residential 44% Hotels 42% Retail 39% Recreational and entertainment 37% 17

18 Types of contracts and measurement and verification protocols M&V Most ESCOs use: - EPC contract in the private sector - A specific one (5Ps) in the public sector Half of them use IMPVP for M&V protocol Average time to sign a contract (months) 18

19 Size and revenue level, technology and Social Corporate Responsibility are key to increase the success rate Success rate 1,355 Mill Average amount of an ESCO contract 0,349 Mill 0,236 Mill Success rate Key factors Success rate Big size 31,17% Revenues > 10 Mill 37,17% Technology: industrial applic. 40,60% SCR report 34,53% 19

20 There is a change in the ESCO market: few years ago, financing was the first barrier, nowadays confidence is the first one Barriers Barriers 1º Distrust on the ESCO model (ESCO credibility) 2º Lack of financing 3º Contracts too complicated 4º Outsourcing of energy management is not perceived as a benefit 5º Lack of knowledge of the ESCO model 6º Lack of information of financial an technical details of EPC model 7º Lack of governmental support 8º Lack of fiscal aids 9º Lack of compiled good practices 10º Lack of benchmark companies 20

21 4. Anese Contribution

22 Key areas of ANESE CO2 Energy Saving Contracts ESCO Financing Tecnology 22

23 ESCO certified classification IPMVP Measurement and verification protocol Energy Manager LEED Sustainable buildings ESCO certification 23

24 Certified Classification of ESCOs: trust is the key point to improve the ESCO model ANESE has established a classification defined in 2014 and lunched in February 2015 that: It is addressed to ALL ESCOs that wish to be classified Provides clarity in the market Distinguishes specialized and professional companies Indicates the business horizon Specialities: Lighting Engines HVAC Systems Regulation and control Isolation Industrial applications 16 certified companies 22 in-progress 24

25 Energy services integrate technology, financing and professional services for a wide period of time, this incorporates a complexity in the common public tenders Politicians Lawyers ESCOs Secretaries of the municipality Others? PRECEDURE 25

26 GUIDE TO DEFINE THE TECHNICAL CLAUSES IN A ENERGY PERFORMANCE CONTRACT TENDER Based in our experience, we have written a set of clauses to improve the public tenders, covering: 1. Type of contract 2. Object of the contract 3. Benefits and SLAs 4. Savings guarantee 5. Time of execution 6. Preventive and corrective maintenance 7. Financing 8. Billing, price revision and penalties 9. Measurement and Verification protocol 10. Certification of the ESCO 11. Ownership of the equipment and systems 12. Exclusions 13. Cancellation of the service. Resolution of the contract 14. Settlement 26

27 Technology guide (download ESCO GT Tecnología model Methodology Contracts Energy audits Financing and insurance Measurement and verification ESCO classification 22 technologies Description Energy saving Regulation Advice of use Sectors of application Good practices Success stories (projects) Energy Saving Measures carried out Technologies used Savings achieved Investment 27

28 ANESE Financing Program Projects Clients ESCOs members of ANESE Specialized Private Equity Funds Matching project needs and investment funds requirements, by Project assessment and screening (using ICP criteria) Project aggregation in portfolios Procedure formalization 28 28

29 Basic requirements (and procedure) Private equity firm SUSI Partners Minimum investment by portfolio Minimum investment by project Repayment period (years) Project type 2 M Greenfield or Brownfield Contract ownership ESCO SI Capital 1 M 0,5 M Greenfield or Brownfield SUMA Capital 2 M 0,5 M 10 Greenfield or Brownfield SPV, Others SPV 29

30 The ESCO Company Energy Services Company (ESCO) based in Seville, established in 2010 It covers the complete cycle of energy services: design, supply, installation, maintenance, guarantee and financing 100% private property, 100% Andalusian equity Fully independent of energy marketers, equipment manufacturers and distributors or comprehensive maintenance companies Betting on technology and innovative own solutions Collaborating Entity of Andalucía es más program Since 2015 most project financing are made through a SPV shared with SUMA Capital Some references 10 Public Street Lighting contracts with more than 10,000 points. (10-12 years) 3 Hotels 2 Shopping Malls 2 Private Office Buildings 8 Residential Buildings 16 Municipality Buildings info@cactus2e.com 30

31 Add an ESCO to your team as expert in energy management Energy Savings Emissions Savings Economic Savings Francisco Cáceres 31