In order to develop the supply of energy-efficient housing renovations, the regions of Hauts-de-France, Grand-Est, Occitanie and Centre-Val de Loire, as well as Bordeaux Metropole, have developed and implemented third-party financing companies (Sociétés de Tiers-Financement), which are typical integrated services for housing renovation, offering homeowners and housing associations project design, technical assistance services during the renovation works, and energy consumption monitoring.
In addition, the French legal framework for third-party financing companies allows them to offer direct financing. They can provide long-term loans, taking into account energy savings to assess the repayment capacity of borrowers. The experience of the French Third Party Financing Companies therefore also provides lessons on how to facilitate the financing of renovations.
As other French regions and cities are considering the development of their own third-party financing offer, under a fully public or public-private status, it is in the interest of existing and future third-party financing companies to strengthen and standardise operational processes in terms of support to households, implementation of renovations, etc.
=> This was the first objective of the Office for Renovations and Financing for Energy Efficiency (ORFEE) project development support. =>The second objective of ORFEE was to strengthen the financial structure of Third-Party Financing Companies and to meet the demand from investors looking for assets that comply with the European Taxonomy of Sustainable Activities.
The creation of the SERAFIN network, i.e. the associative resource centre of third-party financing companies, has allowed the dissemination of Third-party Financing Companies original method to facilitate homeowners' decision-making process to invest in the energy-efficient renovation of their homes, when adapted financing is made available as a key enabler. It includes the repayment capacity of homeowners assessment, taking into account the expected energy savings, based on the quality control and compliance framework developed by the ORFEE project for the homeowner support process during the renovation project.
The guide "How to set up a third-party financing company", published by the SERAFIN network, has been written for local authorities or associations wishing to set up an integrated housing renovation service on their territory, in France and in other European countries. It is aimed at other French regions and cities considering the development of their own third-party financing offer, under a fully public or public-private status, thus contributing to the creation of a large community of providers of packaged renovation services with performance guarantee. This guide is also aimed at a European audience through the EU Peers community of practice for integrated housing renovation service providers, which promotes peer-to-peer exchange of experience.
The objectives of the ORFEE project were adapted to the immediate priority of the third-party financing companies, which was to strengthen their business model. This ultimate goal has been pursued by: 1/ aleviating the dependency of third party financing companies on public policies based on the distribution of subsidies 2/ concentrating financial expertise to rationalise the distribution of renovation loans and make them affordable to all.
This is why the ORFEE Consortium has strengthened its collaboration with the banking sector. Banks are looking for reliable indicators of the impact of renovation works and need to control the risk of insufficient quality to achieve the promised energy performance.
The experience of Third Party Financing Companies shows that they master the operational risk associated with carrying out the work and achieving the energy objectives - something that banks cannot analyse and for which they do not want to take responsibility. Based on this dialogue with bank representatives,
ORFEE CONSORTIUM has dedicated its efforts to submitting a proposal in response to the France 2030 ORENO call for projects at the end of 2023, consisting of the creation of a specialised financing company: FIDEO - Banque de la Rénovation Energétique.
The aim of FIDEO - Banque de la Rénovation Energétique" is twofold:
- It aims to offer loan management services to banks, positioning itself as a cooperative market instrument that simplifies processes for all parties involved. It is designed to be integrated with public incentives for the energy renovation of dwellings, in collaboration with government departments and agencies.
- It allows Third party financing companies to either avoid managing direct loans or to gradually transfer new loans to this financial instrument. This approach allows local authorities to prioritise the support and supervision of operators of packaged renovation services, in accordance with the SERAFIN quality and compliance control framework.
