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Fostering local energy investments in the Province of Matera

Periodic Reporting for period 3 - FESTA (Fostering local energy investments in the Province of Matera)

Reporting period: 2017-12-01 to 2022-01-31

The overall objective of the FESTA project is to foster local energy investments of the public buildings and to spread the Private Public Partnerships (PPP) also through the innovative for the context Energy Performance Contracts (EPC) in convergence regions.
The main specific objectives of the action are:
1. to define technical, financial, legal and administrative specifications of a package of investments projects that are economically sustainable and attractive for private investors;
2. to assess a PPP scheme and to define an EPC model for the energy efficiency of public buildings, in particular of existing school buildings also to accelerate and create better condition to renewal this aged buildings, in average, more than 30 years;
3. to publish the call for tender and to procure the bundled investments through Energy performance contracting and sign the investment contracts;
4. to aspire to become a best practice for the mobilization of energy investments for the local public authority of the region;
5. to share all this advances with other MLEI European partners.
The action aims to “enable investments in flagship initiatives” within the province, in this specific case of the “climate neutral” provincial schools by 2020, through technological innovations and “method innovations”. Specifically, the project aims to promote a first series of interventions (regarding a complex of the schools and a Province office building in Matera and a complex of school with the neighboring hospital in Policoro) in order to experiment with technological and method approaches the achievement of the objective that all schools in the province become “climate neutral” by 2020.
The project also aims to generate capacity building in the field of renewable energy and energy saving through:
-the inter-institutional collaboration;
-special attention to the potential of the PPP in the field of energy;
-development an innovative approach that the project should have in order to be attractive to both lenders and ESCOs.
The PPP approach and the use of the EPC have been used in the first public tender launched in 2018, but no offers have been submitted to the tender at the due date. The partners and subcontractors immediately deepened the emerged critical issues in order to publish a new and effective tender, referring to the optimization of the innovative scheme outputs’ introduced, such as the energy audit, the EPC draft, the business plan.
A favorable legal and/or regulatory framework is a very important factor because the temporary lack of some Italian regulations regarding, for example, the Code of Contract applying or the public contribution to EE investments in Italy, caused some delays in the project.
The opportunity coming from a private operator (ESCo) presenting a proposal under art. 183 c. 15 of D.Lgs 50/2016 and the public co-funding introduced (coming from Basilicata Region) in the project helped the process optimization to be easier and more effective.
The methods and tools provided within the project are expected to be furthermore applied for new EE investments’ projects.
It was not possible to complete the evaluation process of the project proposal within the life time of the Grant Agreement and to sign the contract with the ESCo.
Below the main issues faced and the results achieved within the project life time, in terms of know-how and capacity building.
For energy efficiency projects, bankability is one of the main issues.
Another contribution of the project to the removal of regulatory and non-regulatory barriers to EE financing is the capacity building developed within the institutions involved.
The project contributed also to policy development as demonstrated by the commitment of Regione Basilicata to co-financing with the sum of 1 million the energy efficiency interventions to be carried out as part of the FESTA Project in order to maximize its own environmental objectives.
The capacity building accrued thank to the project can be referred also to the market. A consultation process with ESCos has been conducted, according to the Italian regulation (art. 66 of D.Lgs. 50/2016).
Economic operators were invited to provide suggestions, elaborate comments, highlight critical issues, illustrate technical or contractual solutions deemed preferable or convenient, describe previous experiences regarding the relevant aspects.
On the subject of the EE stakeholders mobilisation and institutionalisation of efforts, during the project life time it has been held specific training days designed to illustrate the technical, financial and legal aspects of developed practices sharing both the processes and the models set up with the project.
The main local dissemination events and training days held:
• No. 2 seminars on the implementation of Energy Performance Contracts (EPC)
• No. 2 training days on Energy Efficiency (EE) theme, use of EPC and other financial schemes for EE measure, their legal and financial aspects etc.
• press conferences
• participation in conferences and forum on EE theme.
The Horizon 2020 contribution played an important role in the project implementation and in its challenging innovative solutions to be realized because the lack of adequate professional skills within the public administration has been compensated by the support of external specialists which have been funded within the project.
At the same time, the H2020 Agency in charge of the project stimulated and created new opportunities to learn even with several seminars and events on the subject.
The expected impacts as set in the Grant Agreement should have been updated once finally assessed the new proposal of the private operator CSI.
The managing of the inter-institutional collaboration between different public authorities in order to increase the scale of interventions and make the investments in the energy sector for the private sector more attractive has been challenging.
Unfortunately, although a good coordination was in place, the project registered lack of collaboration from a partner to finalize the main objective of the project to sign the contract with the ESCo.
Nevertheless, the project outputs and solutions provided within FESTA project can be replicable to other geographies because of the innovative scheme set which is of a large extent applying: Public-Private partnership, the use of an EPC contract, collaboration among public institutions.
At the same time, the project outputs and solutions can be replicable to other sectors but mostly among the public sector services and the public buildings.
The project has taken measures to ensure its sustainability. In fact, in order to maximize the risk-return ratio, the sustainability of the project passed through a unique bankable business plan for the four complex of buildings involved and a Multi-criteria analysis (MCA) framework has been used in order to consider financial and non-financial elements which are identified as relevant impacts on the sustainability of the project.
The consultation processes conducted with the financial institutions and with the ESCos have further contributed to the sustainability of the project.
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