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Improving the attractiveness of investments in energy efficiency and sustainability in buildings

Periodic Reporting for period 1 - BUILDINTEREST (Improving the attractiveness of investments in energy efficiency and sustainability in buildings)

Reporting period: 2016-04-01 to 2017-04-30

Investments in sustainable energy and energy efficiency are currently sub-optimal, forming an important bottleneck for Europe to reach its 20-20-20 targets. Particularly in the building sector, projects require high upfront investments, have high perceived risk, have to deal with complex planning and stakeholder issues, and suffer from split incentives. Since the building sector is also one of the largest energy users in Europe and faces a major and sustained investment challenge, BUILDINTEREST focuses on addressing financial issues in investment in sustainable energy and energy efficiency measures in buildings.

The overall aim of BUILDINTEREST is to reduce uncertainty regarding investments in sustainable buildings, and increased investors' confidence and trust. To do so, the project sets out to realise three primary objectives.

First of all, BUILDINTEREST will develop three national financing platforms: in The Netherlands (Duurzaam Gebouwd), Italy (ASTER) and France (BPIFrance). These platforms will create a structural dialog between the building and financial sector and develop essential tools and financial instruments that will increase attractiveness of investments in sustainable energy in buildings.

In addition, BUILDINTEREST will develop a roadmap, describing the barriers in financing sustainable investments as well as their solutions, and presenting a practical approach to the implementation of these solutions, from financial instruments and contract arrangements to calculation tools and policy measures. The project will also facilitate the implementation of these solutions by the building and financial sector during project operation.

Finally, BUILDINTEREST aims at rapid replication of the national platforms in other European countries. Among other activities, 6 large-scale (inter)national events are organized during the project.
The main focus of BUILDINTEREST in the first year was to establish three financing platforms, aimed at creating a structural dialogue between the construction and financial sector, as well as facilitate the development of essential tools and financial instruments that will increase the attractiveness of investments in sustainable energy in buildings.

The quality of a stakeholder platform depends fully on the quality of the stakeholders on board: this can make the difference between “just talking” and making a real change in the market. The project team is therefore very proud that each platform—one in The Netherlands, one in France, and one in Emilia-Romagna in Italy—was able to engage top-level stakeholders. Each of the platforms has created a recognised brand and secured a strong and impressive support base.

The Dutch platform, Green BuildInvest, has gathered virtually all important stakeholders in The Netherlands, including all large Dutch banks (e.g. ING, ABN AMRO, Rabobank) and the two green banks Triodos and ASN, large construction companies including their national umbrella organisation, the relevant national government departments, but also EU level stakeholders such as EEFIG. These stakeholders are linked to the existing Duurzaam Gebouwd platform of building supply companies.

The Italian regional platform, Build Lab, is firmly rooted in the Emilia-Romagna region, an area that is one of Italy's economic powerhouses. They cooperate closely with the regional government and are very well connected to the main relevant regional, national and European projects and organisations. Build Lab has further secured the support and cooperation of big financial players like Unicredit and BPER. As in the Dutch platform, these stakeholders are linked to ASTER’s existing network of building supply companies.

The French platform has a strong focus on venture capital and start-ups. BPI France has opened up the powerful fundmatching tool of EuroQuity to innovative companies in the building sector across the EU. Despite the platform’s focus on venture capital and start-ups, they have managed to involve leading financial institutions like BNP Paribas, HSBC, CFF and Société Générale in their stakeholder group, as well as construction companies like Bouygues and the UN Environment Programme (UNEP).

All three platforms are working on highly ambitious solutions with a substantial impact on the market, thanks to the involvement of high-level stakeholders in the project. The successful development, facilitation and implementation of these solutions is the main objective of the second and last year of the project.

In addition, the impressive series of events and roundtables that were organised in the three countries in the first year will be continued in the second year. However, the focus of these events will shift from gathering information to enabling cooperating on specific financial tools and instruments.

Finally, the three platform partners expressed clearly that they intend to continue their respective platforms beyond BUILDINTEREST’s project duration, and have worked hard to secure this continuity.
The overall aim of BUILDINTEREST is to reduce uncertainty regarding investments in sustainable buildings, and increased investors' confidence and trust. As a Coordination and Support Action, BUILDINTEREST is not focused on generating new knowledge, but rather on providing a foundation for market actors to address financial issues in investment in sustainable energy and energy efficiency measures in buildings.

The project has done so by bringing together key stakeholders from the construction and financial sector, in the three countries in which a financing platform has been set up: The Netherlands, Italy (Emilia-Romagna) and France. All three platforms have succeeded in engaging high-level stakeholders: from ING, Rabobank, Triodos and EEFIG in The Netherlands to Unicredit and BPER in Emilia-Romagna and BNP Parisbas, HSBS and Bouygues in France.

Together with their stakeholders, the platforms have identified highly ambitious solutions with a substantial impact on the market. For example, stakeholders in the Dutch platform are working on a guideline for real estate valuators to include energy efficiency within their valuation reports, together with the internationally leading certification bodies GBCI and BRE. In Italy, a Guarantee Fund is being developed that provides commercial banks with partial coverage of risk exposure against loans issued for energy efficiency projects, together with the regional government of Emilia-Romagna. And in France, a renovation pilot project is being developed that aggregates different energy efficiency technologies in combination with a tailored loan offer from leading financer Credit Foncier de France (CFF).

The realisation and implementation of these tools and solutions is foreseen in the second project year and will be continued beyond the project. To this end, the three platforms have all secured their continuity beyond the BUILDINTEREST project duration.

Finally, an important activity in the second year of the project is to prepare the replication of successful financing platforms to other European countries and regions, to enhance knowledge-sharing between European regions, to stimulate a structural dialogue between the construction and financial sector on a European level, and in the end to increase the attractiveness of investments in sustainable energy in buildings throughout Europe.
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