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guarantEE Report Summary

Project ID: 696040
Funded under: H2020-EU.3.3.7.

Periodic Reporting for period 1 - guarantEE (Energy Efficiency with Performance Guarantees in Private and Public Sector)

Reporting period: 2016-04-01 to 2017-09-30

Summary of the context and overall objectives of the project

The objective of this project is to develop and roll-out innovative business models addressing and overcoming the split incentives dilemma in a triple-win approach in performance based ESCO projects, thus making Energy Performance Contracting (EPC) more attractive among public and especially private sector building owners.

The building stock is the largest energy consumer in Europe. With a share of 40 percent (2012) of the total final energy consumption, buildings are responsible for 38 percent of the EU’s CO2 emissions. In order to achieve the European CO2 reduction and energy efficiency targets, the modernisation rate in the building stock has to be increased significantly to overcome the prevailing modernisation backlog. As public budgets are strained in many countries, it is crucial that private capital is activated with advanced energy services to implement the necessary energy saving measures (ESM). EPC is an energy service model which has been applied successfully in the modernisation of mostly public buildings since 20 years. A strong roll-out of EPC beyond the public sector has so far been prevented mainly because of two unresolved issues: the split incentives dilemma in rented facilities, and the lack of sufficiently flexible contract models. Within guarantEE, 14 experienced partners will develop innovative business and financing models for performance-based ESCO projects. For rented facilities, the aim is to develop and test solutions adequately sharing costs and benefits between user, building owner and ESCO (triple-win approach). With a special focus on private sector building owners, EPC contract variants providing enhanced flexibility will be developed.

As a result the guarantEE project aims to
- develop innovative EPC-based business models
- elaborate and test contract variants and model processes for enhanced flexibility in EPC
- publish an online EPC pre-check tool
- establish national pools of qualified EPC facilitators; perform trainings
- support the initiation and realisation of 33 EPC pilot projects
- evaluate the success and impact of the developed and applied models and make market and policy recommendations
- disseminate the project results with a wide range of PR measures (incl. 2 European Energy Service Award)

The successful implementation of guarantEE will have a significant impact: The planned 33 pilot projects will achieve 78 GWh primary energy savings and 18.000 t CO2 savings per year and will trigger investments of 11 M€.

Work performed from the beginning of the project to the end of the period covered by the report and main results achieved so far

Main objective of the first project period was to assess the current state of the European EPC market and the needs for performance-based ESCO projects. The EPC market report with SWOT analysis and evaluation of surveys provides meaningful insights in the European EPC market. The report is based on 14 national reports on the corresponding EPC markets. Based on those results and the experience of EPC project facilitators innovative business and financing models for performance-based ESCO projects have been developed. For rented facilities, the aim was to develop and test solutions adequately sharing costs and benefits between user, building owner and ESCO (triple-win approach). With a special focus on private sector building owners, EPC contract variants providing enhanced flexibility have been developed. Market stakeholders have been intensively involved in the analysis of current barriers and the definition of adequate contractual solutions.

The innovative energy service models are to be tested in pilot projects, in which the building owners will receive support from experienced EPC facilitators. The shortlist of potential pilot projects now contains 127 projects, way above the goal of 66 potential projects which is an overachievement of close to 52 %. Of the 127 potential projects approximately 40 % are in the private sector. Partners will support building owners through the milestone tender announcement up to the contract signature by the winning ESCO. This deliverable is not yet due, but some partners have been able to turn potential projects into pilot projects with published tenders. So far 13 concrete pilot projects have been identified. The overall project target is 33 pilot projects.

An EPC pre-check tool was launched during the third project meeting in Amsterdam. The EPC pre-check tool is now available in 13 languages. It can be used to find out if a project or building is suitable for EPC contracting, not in a business case way, but if the organization is ready to outsource energy and maintenance services to a third party. The tool is used 1770 times in Europe in period from April - September. RVO organized the first European Facilitator Workshop on 12 April 2017 in Amsterdam. 14 participants subscribed to the self-declaration with the criteria for EPC facilitators.

In WP6 EPC Dissemination a corporate design was developed and the project website was published. All relevant project results, reports and news have been actively shared via Social Media (more than 12.000 followers), newsletter (more than 2,000 recipients), press releases and presentations on events. The first EESA within the guarantEE project took place on 31 May 2017 in Berlin within the two-days event “Growing Smart Energy Cities” (31 May and 1 June 2017) that was organised together with the European Project URBAN LEARNING – improving processes of integrative energy planning of urban areas in cooperation with the EUROCITIES network. More than 140 people attended the event. The winners of the competition have been honored within a high level award ceremony at Red Town Hall Berlin by Berlin’s Senator for Economy, Energy and Public Enterprises, Ramona Pop, CEO of Berliner Energieagentur (BEA), Michael Geissler, as well as jury member, Dr. Julije Domac (FEDARENE – European Federation of Agencies and Regions for Energy and the Environment). The event has been accompanied by a poster exhibition presenting the projects of EESA applicants.

Progress beyond the state of the art and expected potential impact (including the socio-economic impact and the wider societal implications of the project so far)

-Establish national support structures for EPC by further develop national pools of qualified EPC facilitators and providing facilitator trainings.
-Foster the European know-how transfer on EPC by further develop the European network of EPC facilitators from the participating MS to exchange experiences and share best practices.

-Support EPC clients in the application / testing of newly developed triple-win business models or model processes developed in WP2
-Facilitate the implementation of at least 33 pilot projects with a mix of public and private clients and contribute to the initiation further projects
-Gather and present all pilot projects in European best practice database

-Evaluate the success of the pilot projects and the newly developed EPC business models, contract variants and model processes as applied in the projects.
-Assess the impact of EPC project facilitation to boost the EPC demand-side markets on national level, and to identify strategies through which this impact could be further increased.
-Formulate recommendations to energy sector policy makers on suitable models and processes to boost the roll-out of EPC on the demand side on MS and EU level.

-Further develop guarantEE social network presence
-Presentations at regional and national Events
-Organization of European Energy Service Award 2018

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