2nd OTS - 50000&1SEAPs : Patrycja Plonka PNEC

Supporting Local Authoritites in the Development and Integration of SEAPs with

Energy management SystemsAccording to ISO 500001 www.500001seaps.eu

@500001SEAPs

How to implement and EnMS + SEAP

approach?

CHOOSING YOUR FUNDING

Patrycja Płonka, Project Manager

patrycja.plonka @pnec.org.pl

Association of Municipalities Polish Network

„Energie Cités”



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ASSOCIATION OF MUNICIPALITIES POLISH NETWORK

„ENERGIE CITÉS” …

it is a Polish non-governmental organisation operating since 1994 and supporting

sustainable energy planning and implementation on the local level;

its activities include:

• promotion of energy efficiency and use of renewable energy sources;

• implementation of projects supporting sustainable energy development of Polish municipalities;

• organization of conferences, seminars, workshops, study tours etc. devoted to energy-related

issues;

• supporting exchange of experience and ideas between its members;

• helping in identifying and obtaining funds for energy-related projects.

its members are local and regional authorities from all over Poland

since April 2009 the organisation is an official Covenant Supporter and as

such supports Polish CoM signatories in the development and implementation

of SEAPs.



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FINANCING SEAP ACTIONS – KEY ASPECTS

Municipal budget

• operational costs (i.e. costs of energy consumption in municipal facilities)

• investment costs (i.e. costs related to the implementation of SEAP actions)

Sources of financing of sustainable energy actions

Own

budget Funds distributed at

EU level

Horizon 2020

UIA

INTERREG (BSR,

CE, E)

ELENA

MLEI/PDA

Funds distributed at

the national and

regional level

OPs & ROPs

National and regional

environmental funds

Other Funds

EEA FM

NFM

Swiss Funds

Alternative

financing

schemes

PPP

ESCO

PICO

Revolving Funds

Community energy

projects

Privtae

sources

Banks

Other private

investors



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FIRST STEPS

Prioritization of actions (financial perspective):

• financial aspects considered: implementation cost, payback period, IRR/ERR (factors measuring

profitabilty of investments), NPV

• selection criteria: relatively low cost of investment, availability of financing sources, interest of

potential investors, economic benefits

Project profitability assessment based on simple payback – initial investment divided by cummulative

costs savings over project life-time:

• 3-5 years – very good profitability

• 6-10 years – average profitability

• over 11 years – low profitability (hard to find external financing)

Actions with large investment costs may be challenging for small and medium municipalities (harder to

secure commercial funding; bigger guarantees reqquired) – possible solutions:

• risk sharing between different financing sources

• bundling similar projects implemented by several neighbouring municipalities



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EXAMPLE OF NIEPOŁOMICE – JOINT RES PROJECT

4 neighbouring municipalities join forces, prepare a common

RES project and obtain co-financing form the Polish – Swiss

Cooperation Fund:

• municipality of Niepołomice – lead partner

• municipality of Wieliczka

• municipality of Skawina

• municipality of Miechów

RES systems are installed in 3841 households and 32 public buildings

In case of private buildings, owners cover 30% of the costs

RES systems include solar thermal panels, PV modules and heat pumps

Source:

www.niepolomicesolary.eu

http://www.niepolomicesolary.eu/



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EU-LEVEL FUNDING

HORIZON 2020

biggest EU Research and Innovation-funding programme

nearly €80 billion of funding available over 7 years (2014 to 2020)

focus areas: secure, clean and efficient energy; smart, green and

integrated transport; climate & environmental actions, resource efficiency

next call of proposals closes 15 of September 2016 (EE-09 2016-2017

Engaging and activating public authorities)

INTERREGs (EUROPE, BSR, CE)

IE: supporting RAs & LAs across Europe to develop and deliver better

policies by sharing solutions, know-how and best practices

ICE: supporting partners from CE to work together to improve their cities

and regions (also in terms of CO2 reducion and natural resources

preservation)

IBSR: facilitates transnational cooperation in the Baltic Sea Region

addressing common challenges (priorities include: management of natural

resources and sustainable transport)



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EU-LEVEL FUNDING

LIFE

financial instrument supporting environmental, nature conservation and

climate action projects throughout the EU;

nearly €3.4 billion of funding available over 7 years (2014 to 2020)

(1) nature and biodiversity, (2) environment and (3) climate action)

two calls for proposals have been launnched recentrly – for environment

and climate actions. They cover traditional projects (best-practice,

demonstration, pilot or information, awareness and dissemination projects)

URBAN INNOVATIVE ACTIONS (UIA)

provides urban areas throughout Europe with resources to test new and

unproven solutions to solve their urban challenges (impact on innovation,

not results)

Only cities can be lead partners!

Only for cities over 50 000 inhabitants

12 topics in 3 rounds, including: energy transition, urban poverty, air

quality, climate adaptation, sustainable use of land and urban mobility



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FUND DISTRIBUTED ON THE NATIONAL AND REGIONAL LEVEL

(EXAMPLE OF POLAND)

Operational Programmes

• Operational Programme „Infastructure and Environment”

Regional Operational Programmes

• 16 programmes in 16 voivodeships

National Fund for Environmental Protection and Water Management

• provides financing to environmentally-friendly projects and initiatives implemented by

different Polish stakeholders.

• together with voivodeship funds it is the pillar of the Polish system of financing

environmental protection and water management activities.

Voivodeship Funds for Environmental Protection and Water Management

• 16 funds in 16 voivodeships

Environmental Protection Bank

• offers preferential loans for environmental investments, as well as other banking

products with „green benefits”



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ALTERNATIVE FUNDING SOURCES – ESCO SCHEME

Within the ESCO scheme investment projects are implemented together by the

municipality and private investor (Enegy Services Company). The investor usually

finances the project without any up-front investment costs for the municiplity and the

costs are recovered and the profit is made from the energy savings achieved during the

contract period.

The contract guarantees certain amount of savings for the municipality at the same time

helping them to avoid large investment costs.

The key benefit for the municipality is removal of project non-perfrmance risk, while

keeping the operating costs at relatively low level.

Financing is arranged so that the energy savings cover both the costs of investments

and of contractors services.

Accurate and relibale monitoring and verification of energy savins is crucial – easier

with EnMS in place!



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ESCO SCHEME – EXAMPLES FROM POLAND

Przytyk

(7300 inhabitants)

Project: Modernisation of street lighting

ESCO: ELAST company

Initial situation: high cost and low

quality of public lighing, frequent

failures

Project scope: replacement of current

lamps with LED lamps, installation of

street light controllers with astronomical

timer; individual reduction of power

over night

Result: reducing CO2 emissions by

550 t, electricity consumption by 67%

and electricity costs by 384 000 PLN

Sosnowiec

(214 488 inhabitants)

Project: Energy modernisation of

educational facilities (EnMS)

ESCO: Siemens company

Initial situation: high operating costs

of the facilities

Project scope: installation of energy

monitoring and energy management

system in all educational facilities,

allowing also for remote control of the

heating system

Result (as in contract): reducing heat

consumption by 30% and electricity

consumption by 25%; annual financial

savings - 2 294 395 PLN



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ALTERNATIVE FUNDING SOURCES – REVOLVING FUNDS

Financial scheme aimed at establishing sustainable set of finacning for a set of investment

projects. It may include loans or grants and aims at becoming self-sustainable after its first

capitalisation.

The objective is to invest in profitable projects, with short payback time, be repaid and use the

same funds to finance new projects.

The owners / managers of the fund can be public or private companies, organisations,

institutions or public authorities.

„Mini-revolving funds” created within

EURONET 50/50 MAX project

EURONET 50/50 MAX was an IEE-funded project aiming at mobilizing energy savings in public buildings

through the implementation of the 50/50 methodology, which actively involves building users in energy

management. Achieved financial savings are shared equally between the school and the local authority which

covers the energy bills.

Participating municipalities/schools were encouraged to use their 50% of the savings to invest in

further energy efficiency measures in the building.



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ALTERNATIVE FUNDING SOURCES – OTHER

PICO Scheme – works similarily as the ESCO model but here it is one of the LAs’ departments that acts

as an ESCO unit for another department(s). The ESCO department organises, finances and

implements energy-efficiency improvements mostly through a fund made up of municipal money,

and using existing know-how.

On-bill financing - Energy suppliers give a loan for EE investments and collect the repayment through

energy bills. It leverages the relationship existing between a utility and its customer; this model is

developed mostly in UK.

Green bonds - LAs can issue green bonds to fund their sustainable energy projects. A green bond can

operate as a normal bond, which is a debt that will be paid back, depending on the characteristics of

the bond, with interest.

Community energy projects - pooling resources from different local actors and sharing benefits

between them (e.g. energy cooperatives)

„Our energy” cooperative near Zamość (PL)

The cooperative is composed of 4 municipalities and 2 private companies. Invitation to join was also issued to the

citizens and local stakeholders. The cooperative is planning to build a complex of biogas-fueled power plants

connected with autonomic network (it will supply with energy public buildings, public lighting and households).



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MORE OPPRTUNITIES – COMO QUICK REFERENCE GUIDE

www.covenantof

mayors.eu



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SOME FOOD FOR THOUGHT – BEST SOURCE OF MONEY ARE SAVINGS!

Adopt Energy Manager, who will be responsible for:

monitoring and managing energy consumption in public buildings and facilities

cooperation with energy utilities and reviewing contracts with them (to better adapt them to actual

demand)

develop , implement and monitor local energy strategies and action plans

develop and implement sustainable energy projects

educate citizens in the field of energy and help them in launching their own initiatives

Implement energy management system that will help you to:

optimize energy consumption within the municipality and this reduce energy costs

get better control over implemented energy saving measures

give good example to citizens and local stakeholders

The costs and efforts invested pay off quickly!!



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Thank you!

Patrycja Płonka, Project Manager

[email protected]

Association of Municipalities Polish Network „Energie Cités”

2nd OTS - 50000&1SEAPs : Patrycja Plonka PNEC

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