Periodic Reporting for period 1 - HousEEnvest (Energy Efficiency Investments in multifamily houses)
Reporting period: 2018-03-01 to 2019-08-31
Market analyses developed has identified that the number of financial products destined to the communities of owners for energy rehabilitation of buildings is almost non-existent. Financial institutions that had some financial product for this type of users were barely identified, and the existing products had the following main characteristics: reduced repayment term and high interest rates between others.
In addition, there are other reasons why there is no greater demand for rehabilitation works as the lack of permanent incentives from public administrations and citizens' lack of knowledge about the economic savings they provide. It should also be note the great management costs of this type of works for the promoters.
This, together with other technical, legal and economic barriers prevent the development of investment in renovation sector.
The analysis of the Extremadura’s building stock provides that the 60% of the buildings, have an average age of over 40 years, which means that they were not built under criteria of energy efficiency since it is not until 1979, with the entry into force of the norm NBE-CT 79, when buildings were to be built under isolation criteria.
Due to the clear need for action in the Extremadura's building stock along with the market failures, HousEEnvest project arises. Composed by a consortium of 9 national partners in which all the key agents of the building energy rehabilitation sector are represented, aims at overcoming existing barriers in the energy rehabilitation market of residential buildings.
For this, a Portfolio Guarantee Fund is proposed, defined for the integral energy renovation of multifamily buildings in Extremadura, which will have a combination of innovative tools for standardization, pooling, bundling and de-risking which will give security to financial institutions and communities of owners.
HousEEnvest focuses on a regional market and aims to mobilize investments amounting to more than 35 million euros in Extremadura.
The project will address several fundamental challenges to overcome market barriers by developing a series of integrated services.
HousEEnvest will create the entire management structure of the Instrument to mobilize private funds backed by the European Structural Investment Funds (ESI Funds). It will work between 2018 and 2021 and will ensure that the ERDF funds allocated to the guarantee product are properly implemented.
1. Identification of the target buildings. This task has been channelled through the Building’s managers. Through them, a first characterization of the building has been possible and also, the documentation needed for the feasibility study and the building visit's management has been provided.
Although at the beginning, the response was lower than expected, at the end of the reporting period, 345 buildings has been identified.
2. The economic and technical feasibility studies: In the period covered by this report, 88 buildings have been visited and 57 of them have completed the technical study.
The delay in studies starts has been caused by the long process spent to establishment a general methodology to standardize the studies' development.
3. The creation of the Extremadura investment financing scheme
Due to the strong effort to convince Management Authority jointly with the legal administrative procedure and also with additional intermediates steps, this task is involving a longer process that planned. In addition, in the whole process, some of the people in charge of decision-making were replaced.
Due to the funds are ERDF and the existing OP didn’t include the option of cofinancing a public financial instrument related to energy efficiency project the modification of the OP and selection criteria was a requirement. It was approved in December 2018. In addition, as is required, the Financing Scheme was approved as part of LAW 11/2019, of April 11 at the beginning of 2019.
In addition, other work has been performed. These activities did not find important problems during its development and, in most cases, it could be finished on time:
- Own tasks of coordination and management of the project and its related deliverables.
- Creation of the working table for the demand and offer with several meetings held in the two cases.
- Development of the HousEE platform setting the structure and the contents.
- Identification of the target market for the training and setting of the content of the training sessions.
- A common brand of the project (visual identity toolkit and templates), project website and the social media profiles were created under the guidelines of the Communication and Dissemination Plan.
- The project was disseminated in several events at regional, national and EU level
In general, great progress has been achieved in the project taking into account its complexity and external issues occurred during its development.
The creation of the new finance scheme proposed in the project will address the financial barrier by offering specific financial products adapted to the specific requirements of community owners and also to the features of the renovation investments. The money lend will be in better conditions than the few financial product currently available.
Although the development of the scheme is involving a longer process that planned, several goals has been achieve in this sense: the modification of the OP needed due to the funds' source, the approval of the financing scheme as part of a LAW , meetings between stakeholders and also meetings with the financial institutions.
Thanks to the Project Development Unit (PDU), the project offer free advice and support, thus enabling to break the barrier of the lack of knowledge in energy efficiency and rehabilitation investments by the owners. The development of the technical and economic study by the PDU and also the support offered will provide stability, security and assurance to the owners. For that purpose, several informative days of the project and its benefits along with the need for home renovation and the benefits that its entails were made to Building’s Managers. In addition, 88 buildings has been visited for data gathering and 57 buildings have completed the technical study.
To this, must be added that because advice and support offered is free, the barrier of managements costs disappear.
HousEEnvest project actions are expect to demonstrate the following impacts:
- Delivery of sustainable energy investment project and innovate financing solutions
- Every million Euro of support triggers investments worth at least EU 15 million
- Primary energy savings, renewable energy production and investments in sustainable energy
- Demonstration of innovative and replicable products
In addition, is expected more that 35M€ mobilize, 300 people with increase capacity and also 1.00 buildings and 6.000 families involved.