Periodic Reporting for period 1 - SEIFA (Sustainable Energy Investing and Financing Activation)
Okres sprawozdawczy: 2021-06-01 do 2022-11-30
The project of the Sustainable Energy Investing and Financing Activation (SEIFA) will create incentives to increase private equity investing for the industrial decarbonisation of the built environment. The SEIFA project is focusing on investing in and financing sustainable industrial projects, energy supply facilities, and energy service companies. The investors-first approach will be held with an emphasis on the environmental impact in terms of decarbonisation rate and risk-adjusted rate of return. A new investment vehicle to incentivise investments in sustainable energy projects will be established. Innovative financing schemes will include sustainable energy investing risks metrics and benefits. A network of deal originators will be established. The financial software tools will be provided for the ongoing portfolio overview, assessments, and sustainability reporting. It is expected to provide up to 500 million EUR for sustainable energy projects during the SEIFA project duration and up to 5 billion EUR during the 5 years after the project's completion. The SEIFA project platform will greatly increase the attractiveness of sustainable energy investing across Europe and beyond.
During the first 18 months, SEIFA has successfully reached all the milestones (3) and submitted all deliverables (29) planned across all the Work Packages (WPs), in line with the schedule proposed in the Grant Agreement (GA), except for the ones where the extension was requested and approved by the EC within the 1st amendment to the GA. Work has started in every task and all of the WPs are on track and running, with the main results that can be summarised as follows:
WP1: Advisory Board (AB) set-up, bilateral meetings with AB held to seek feedback on the SEIF value proposition towards investees and investors (1st AB meeting held on 15 December 22). Overall project management structure set in place. 18 meetings and teleconferences (combined) both internally within the consortium and externally with CINEA, 1 Steering Committee Meeting, and 1 approved amendment to the GA.
WP2: Developed the comprehensive risk management methodology including risk & compliance framework, all relevant policies and guidelines, data sets, data collection and analysis models/tools, KYC and due diligence templates and procedures. All WP2 activities are being done with a significant focus on ESG/Sustainability metrics and in line with the specifications of SFDR and EU Taxonomy.
WP3: The accomplishment of SEIFA Platform User Interface and Experience Design can be highlighted as well as the launch of the public website. The majority of the main key system functionalities from the back-end side were implemented.
WP4: Launch of Network of Project Aggregators (NPA) with 6 main hubs (Tier 1) hosted by the project partners and located in partner countries. Tier 2 of the NPA was also developed, formed of external partners capable of originating deals and attracting potential investees.
- The Document of Value Proposition for Investable Projects (presentation and leaflet) - extensively discussed in joint meetings with the project partners.
- The List of Investable Sustainable Energy Projects has been structured with its 1st version submitted with 579 entries in it. The list is continuously updated containing at the moment 625 potential projects/investees.
- The 1st version of the Structured Pipelines was submitted with a total of 86 identified potential deals. At the moment it contains 125 potential projects.
The design of the Toolkit for support to asset operators and project developers started.
WP5: Accomplished List of Potential Investors and widely discussed Fund Proposal (tested and constantly refined according to the feedback from the market). As a part of the Fund Proposal, the SEIF deck and the SEIF pipeline, and model portfolio presentations for potential investors were developed. On-going discussions and negotiations with potential investors (including EBRD and EIF, pension funds, investment companies, and family offices) and constant search for new ones. Establishlished connections with stakeholders to support fundraising activities (i.e. placement agents). Partners attended also investment conferences (i.e. ESG Investment Leader Summit (London)) to present SEIF and engage potential investors.
WP6: Provided the design for the investment process and made the relevant legal assessments. The works on the establishment of the new financial mechanism are well-advanced and aligned with the applicable European requirements on taxonomy and sustainable finance disclosures.
WP7: Created the brand identity of the project and dissemination materials (8 blogposts, 2 videos, 2 newsletters), established synergies with 9 existing projects and initiatives within the same area (e.g. NEEM-HUB, LEVEL EEI, TRUSTEE, Propel, SEFA, STAGE, V4decarb...). Partners participated in 13 high-level external events to present SEIFA.
In conclusion, the first 18 months of the SEIFA project addressed by the present report may be referred to as a closed onboarding period that prepared the ground for the crucial upcoming phase where the project is at the moment, and where the new financial scheme to incentivise private individual and institutional investments to sustainable energy projects will be established and its value proposition is being tested both by investors and investable projects. Major efforts are being made by the consortium to build a strong and credible pipeline of investable projects and to attract investors for SEIF.
WP1: Advisory Board (AB) set-up, bilateral meetings with AB held to seek feedback on the SEIF value proposition towards investees and investors (1st AB meeting held on 15 December 22). Overall project management structure set in place. 18 meetings and teleconferences (combined) both internally within the consortium and externally with CINEA, 1 Steering Committee Meeting, and 1 approved amendment to the GA.
WP2: Developed the comprehensive risk management methodology including risk & compliance framework, all relevant policies and guidelines, data sets, data collection and analysis models/tools, KYC and due diligence templates and procedures. All WP2 activities are being done with a significant focus on ESG/Sustainability metrics and in line with the specifications of SFDR and EU Taxonomy.
WP3: The accomplishment of SEIFA Platform User Interface and Experience Design can be highlighted as well as the launch of the public website. The majority of the main key system functionalities from the back-end side were implemented.
WP4: Launch of Network of Project Aggregators (NPA) with 6 main hubs (Tier 1) hosted by the project partners and located in partner countries. Tier 2 of the NPA was also developed, formed of external partners capable of originating deals and attracting potential investees.
- The Document of Value Proposition for Investable Projects (presentation and leaflet) - extensively discussed in joint meetings with the project partners.
- The List of Investable Sustainable Energy Projects has been structured with its 1st version submitted with 579 entries in it. The list is continuously updated containing at the moment 625 potential projects/investees.
- The 1st version of the Structured Pipelines was submitted with a total of 86 identified potential deals. At the moment it contains 125 potential projects.
The design of the Toolkit for support to asset operators and project developers started.
WP5: Accomplished List of Potential Investors and widely discussed Fund Proposal (tested and constantly refined according to the feedback from the market). As a part of the Fund Proposal, the SEIF deck and the SEIF pipeline, and model portfolio presentations for potential investors were developed. On-going discussions and negotiations with potential investors (including EBRD and EIF, pension funds, investment companies, and family offices) and constant search for new ones. Establishlished connections with stakeholders to support fundraising activities (i.e. placement agents). Partners attended also investment conferences (i.e. ESG Investment Leader Summit (London)) to present SEIF and engage potential investors.
WP6: Provided the design for the investment process and made the relevant legal assessments. The works on the establishment of the new financial mechanism are well-advanced and aligned with the applicable European requirements on taxonomy and sustainable finance disclosures.
WP7: Created the brand identity of the project and dissemination materials (8 blogposts, 2 videos, 2 newsletters), established synergies with 9 existing projects and initiatives within the same area (e.g. NEEM-HUB, LEVEL EEI, TRUSTEE, Propel, SEFA, STAGE, V4decarb...). Partners participated in 13 high-level external events to present SEIFA.
In conclusion, the first 18 months of the SEIFA project addressed by the present report may be referred to as a closed onboarding period that prepared the ground for the crucial upcoming phase where the project is at the moment, and where the new financial scheme to incentivise private individual and institutional investments to sustainable energy projects will be established and its value proposition is being tested both by investors and investable projects. Major efforts are being made by the consortium to build a strong and credible pipeline of investable projects and to attract investors for SEIF.
Significant progress has been made during the period toward the accomplishment of the project objectives, in some metrics beyond the proposed KPIs in WP2 and WP5.
A breakdown of the major expected activities per WP to be produced until the end of the project includes:
WP1: At least 1 more Advisory Board is to be held
WP2: 1 more dataset and 2 recommendations to be produced
WP3: SEIFA Platform fully operational and launched
WP4: Well-established NPA and credible pipeline of investable projects
WP5: Capital raised for sustainable energy-related industrial projects
WP6: Launch of the fund and Secondary Market Term Sheet
WP7: More dissemination activities to promote the project activities
These activities shall lead to the development of assets of SEIFA to be exploited:
- commercially: SEIF fund - the new innovative and operational financial mechanism(s) (Private Equity Investment Vehicle(s)) Sustainable Energy Investment Fund and its Sub-fund SEIF CEE, and its linked assets – the NPA and the SEIFA Platform; and
- non-commercially: Data models, templates of due diligence questionnaires or packages for investees and specific data for the companies, lessons learned and recommendations toolkit, etc.
These assets will trigger investments in sustainable energy, provide significant primary energy savings, reduce GHG emissions, and also boost EU competitiveness by improving the efficiency of production processes and reducing the costs of accessing and managing resources among other positive impacts.
A breakdown of the major expected activities per WP to be produced until the end of the project includes:
WP1: At least 1 more Advisory Board is to be held
WP2: 1 more dataset and 2 recommendations to be produced
WP3: SEIFA Platform fully operational and launched
WP4: Well-established NPA and credible pipeline of investable projects
WP5: Capital raised for sustainable energy-related industrial projects
WP6: Launch of the fund and Secondary Market Term Sheet
WP7: More dissemination activities to promote the project activities
These activities shall lead to the development of assets of SEIFA to be exploited:
- commercially: SEIF fund - the new innovative and operational financial mechanism(s) (Private Equity Investment Vehicle(s)) Sustainable Energy Investment Fund and its Sub-fund SEIF CEE, and its linked assets – the NPA and the SEIFA Platform; and
- non-commercially: Data models, templates of due diligence questionnaires or packages for investees and specific data for the companies, lessons learned and recommendations toolkit, etc.
These assets will trigger investments in sustainable energy, provide significant primary energy savings, reduce GHG emissions, and also boost EU competitiveness by improving the efficiency of production processes and reducing the costs of accessing and managing resources among other positive impacts.