Environmental Defence Fund Europe/UK today rolled out the Investor Confidence Project Europe (ICP Europe), which is aimed at boosting private sector investment in European building renovations.
The ICP Europe initiative was officially announced to European leaders from the financial, engineering, and government communities at an event in Brussels during an important week, when two of the European energy efficiency industry’s largest events were held – Renovate Europe Day and Building Performance Institute of Europe ‘s Efficiency Investors Day.
The ICP Europe initiative was officially announced to European leaders from the financial, engineering, and government communities at an event in Brussels during an important week, when two of the European energy efficiency industry’s largest events were held – Renovate Europe Day and Building Performance Institute of Europe ‘s Efficiency Investors Day.
ICP Europe Launch Event, Brussels Belgium
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The potential for renovating existing buildings in Europe to reduce the impacts of climate change, generate financial savings, and create jobs is considerable – and largely untapped. Estimates say that energy efficiency on a large scale in Europe could reduce carbon emissions by 932 million tons, equivalent to taking nearly 200 million cars off the road and creating more than 1 million new jobs in the building industry by 2050.
Recognizing this, the European Commission has set a goal of reducing carbon emissions by 90% in the building sector by 2050. However, significant investment will be needed to achieve the 2050 goals, estimated at €3.5 trillion, or an annual €95 billion. Investment at this scale requires substantial financing from private sector investors who will need to view building renovation projects as safe and profitable investments.
The goal of ICP Europe is to help transform the energy efficiency market by standardizing how building renovation projects are developed and measured. Similar to the standardized processes and documentation used in the oil and gas and renewables industry to develop projects, this approach streamlines energy efficiency transactions and increases the reliability of projected energy savings.
This reduces risks and transaction costs for investors, spurring financing that will lead to a building sector with lower operating costs, higher market value, and a significantly lower carbon footprint. Over the longer term, the initiative aims to make energy efficiency a recognized and standardized asset class that will enable capital markets to invest in energy efficiency projects.
Think about the standardization behind mass-market financial products such as mortgages, car loans, and credit cards, which are aggregated and then sold as bonds to access the debt capital markets. Unless we can get to that stage with energy efficiency finance we can’t raise the huge amount of capital needed to meet Europe’s ambitious carbon goals.
Shout-outs for ICP Europe
The ICP Europe concept has great support. The Energy Efficiency Financial Institutions Group – convened by the European Commission and United Nations Environment Program – specifically highlighted the ICP in its interim report, Energy Efficiency – the first fuel for the EU economy, as a model industry best practice. It also called for the “launch of an EU-wide initiative to develop a common set of procedures and standards for energy efficiency and buildings refurbishment underwriting for both debt and equity investments.”
The International Energy Agency also weighed in last month, saying in its Energy Efficiency Market Report 2014, “[The Investor Confidence Project] will facilitate a global market for financings by institutional investors that look to rely on standardized products rather than project-specific structuring and due diligence."
What the Investor Confidence Project Europe is not
It is important to understand what ICP Europe is not. It is not developing new technical standards. Plenty of these exist – rather it is about using the available standards in a common way through the entire process of developing and documenting energy efficiency projects.
ICP Europe is also not about enforcing a U.S. model – the process of developing a project anywhere in the world will follow the same process but use different engineering standards. What will be common between the U.S. and Europe is an approach, not specific standards or protocols. This is essential because the world of finance is international and many of the large institutional investors who want to invest in energy efficiency, but are currently constrained from doing so, operate on both sides of the Atlantic and, indeed, around the world.
Powerful Pan-European support
We have built a powerful pan-European coalition of banks, development banks, investors, property owners, energy efficiency companies and government agencies among others who support ICP Europe.
ICP Europe team has assembled a steering group from the top organizations and companies in their sectors, including ING Bank, Green Investment Bank, eu.ESCO, Plus Ultra Asset Management, ARUP, EuroACE, RdA Climate Solutions, Siemens, E.oNON, Building Performance Institute of Europe, Climate Solutions and United Kingdom Department of Energy and Climate change.
ING Bank’s Global Head of Energy and Carbon Efficiency, Stephen Hibbert, said the bank is “enthused to be a member of the steering group and look forward to sharing our experience and playing our part in building an effective market for energy efficiency finance.”
To participate in this exciting initiative, please join the ICP Europe Technical Forum to help us choose from among the leading energy efficiency standards or support us by joining the no-cost ICP Europe Ally Network.
Recognizing this, the European Commission has set a goal of reducing carbon emissions by 90% in the building sector by 2050. However, significant investment will be needed to achieve the 2050 goals, estimated at €3.5 trillion, or an annual €95 billion. Investment at this scale requires substantial financing from private sector investors who will need to view building renovation projects as safe and profitable investments.
The goal of ICP Europe is to help transform the energy efficiency market by standardizing how building renovation projects are developed and measured. Similar to the standardized processes and documentation used in the oil and gas and renewables industry to develop projects, this approach streamlines energy efficiency transactions and increases the reliability of projected energy savings.
This reduces risks and transaction costs for investors, spurring financing that will lead to a building sector with lower operating costs, higher market value, and a significantly lower carbon footprint. Over the longer term, the initiative aims to make energy efficiency a recognized and standardized asset class that will enable capital markets to invest in energy efficiency projects.
Think about the standardization behind mass-market financial products such as mortgages, car loans, and credit cards, which are aggregated and then sold as bonds to access the debt capital markets. Unless we can get to that stage with energy efficiency finance we can’t raise the huge amount of capital needed to meet Europe’s ambitious carbon goals.
Shout-outs for ICP Europe
The ICP Europe concept has great support. The Energy Efficiency Financial Institutions Group – convened by the European Commission and United Nations Environment Program – specifically highlighted the ICP in its interim report, Energy Efficiency – the first fuel for the EU economy, as a model industry best practice. It also called for the “launch of an EU-wide initiative to develop a common set of procedures and standards for energy efficiency and buildings refurbishment underwriting for both debt and equity investments.”
The International Energy Agency also weighed in last month, saying in its Energy Efficiency Market Report 2014, “[The Investor Confidence Project] will facilitate a global market for financings by institutional investors that look to rely on standardized products rather than project-specific structuring and due diligence."
What the Investor Confidence Project Europe is not
It is important to understand what ICP Europe is not. It is not developing new technical standards. Plenty of these exist – rather it is about using the available standards in a common way through the entire process of developing and documenting energy efficiency projects.
ICP Europe is also not about enforcing a U.S. model – the process of developing a project anywhere in the world will follow the same process but use different engineering standards. What will be common between the U.S. and Europe is an approach, not specific standards or protocols. This is essential because the world of finance is international and many of the large institutional investors who want to invest in energy efficiency, but are currently constrained from doing so, operate on both sides of the Atlantic and, indeed, around the world.
Powerful Pan-European support
We have built a powerful pan-European coalition of banks, development banks, investors, property owners, energy efficiency companies and government agencies among others who support ICP Europe.
ICP Europe team has assembled a steering group from the top organizations and companies in their sectors, including ING Bank, Green Investment Bank, eu.ESCO, Plus Ultra Asset Management, ARUP, EuroACE, RdA Climate Solutions, Siemens, E.oNON, Building Performance Institute of Europe, Climate Solutions and United Kingdom Department of Energy and Climate change.
ING Bank’s Global Head of Energy and Carbon Efficiency, Stephen Hibbert, said the bank is “enthused to be a member of the steering group and look forward to sharing our experience and playing our part in building an effective market for energy efficiency finance.”
To participate in this exciting initiative, please join the ICP Europe Technical Forum to help us choose from among the leading energy efficiency standards or support us by joining the no-cost ICP Europe Ally Network.
Introducing the ICP Europe Team
Panama Bartholomy, Director of ICP Europe
Forging partnerships among varying disciplines and stakeholders, Panama Bartholomy has managed and facilitated the creation and implementation of some of the largest climate and energy programs in the United States. Panama’s work focuses on finding policy and program solutions for communities facing energy efficiency, renewable energy, land use and climate change challenges. Panama combines frontline experience with state and local government policy and has dealt extensively in the regulatory and utility arenas.
Currently, Panama is Director of the Investor Confidence Project Europe, a project of the Environmental Defense Fund, where he works with a wide array of stakeholders to develop standard methodologies and protocols for energy efficiency project development and documentation. These protocols are designed to reduce transaction costs associated with energy efficiency investment, and develop actuarial data to unlock capital markets.
Previously, Panama was the Advisor on Energy and Natural Resources to California Assembly Speaker John A. Perez where he oversaw the State of California’s energy and environmental legislation and budget. He earlier served as Deputy Director of the California Energy Commission’s Efficiency and Renewables Division and advisor for Chairmen Douglas and Pfannenstiel, worked for the California Conservation Corps on vocational environmental education, and ran the Sustainable Schools program for the Division of the State Architect. Panama served on the City of Sacramento Planning Commission and the County of Sacramento Environmental Commission, and is a former board member on the U.S. Green Building Council (USGBC) and past president of the Northern California Chapter of the USGBC.
Forging partnerships among varying disciplines and stakeholders, Panama Bartholomy has managed and facilitated the creation and implementation of some of the largest climate and energy programs in the United States. Panama’s work focuses on finding policy and program solutions for communities facing energy efficiency, renewable energy, land use and climate change challenges. Panama combines frontline experience with state and local government policy and has dealt extensively in the regulatory and utility arenas.
Currently, Panama is Director of the Investor Confidence Project Europe, a project of the Environmental Defense Fund, where he works with a wide array of stakeholders to develop standard methodologies and protocols for energy efficiency project development and documentation. These protocols are designed to reduce transaction costs associated with energy efficiency investment, and develop actuarial data to unlock capital markets.
Previously, Panama was the Advisor on Energy and Natural Resources to California Assembly Speaker John A. Perez where he oversaw the State of California’s energy and environmental legislation and budget. He earlier served as Deputy Director of the California Energy Commission’s Efficiency and Renewables Division and advisor for Chairmen Douglas and Pfannenstiel, worked for the California Conservation Corps on vocational environmental education, and ran the Sustainable Schools program for the Division of the State Architect. Panama served on the City of Sacramento Planning Commission and the County of Sacramento Environmental Commission, and is a former board member on the U.S. Green Building Council (USGBC) and past president of the Northern California Chapter of the USGBC.
Dr. Steven Fawkes, ICP Europe Senior Advisor
Steve is a globally recognized expert in energy efficiency and energy efficiency finance, with over 30 years of experience in the sector. He advises energy and clean-tech companies, sits on the Investment Committee of the London Energy Efficiency Fund, and is a Trustee of the National Energy Foundation.
He was previously a Corporate Finance Partner at Matrix Corporate Capital and, earlier, led the Extel # 1 rated New Energy and Clean Technology research team at Matrix. Steve spent over 20 years implementing energy efficiency programs for many large private and public sector organizations, including local authorities and major corporates such as Diageo (Guinness), Sainsburys and GSK. He also co-founded two energy service companies, one in the UK (which is now part of RWE npower) and one in Romania. In Romania, he also developed energy efficiency programs funded by the EU, the UNDP and USAID. Steve has over 250 publications, including two books on energy efficiency, and has been an Adviser to the UK Department of Energy & Climate Change (where he assisted in establishing the Energy Efficiency Deployment Office), China’s National Development and Reform Commission and a leading Japanese engineering company. In November 2012, he won the Energy Institute’s Individual Achievement Award.
Steve is a globally recognized expert in energy efficiency and energy efficiency finance, with over 30 years of experience in the sector. He advises energy and clean-tech companies, sits on the Investment Committee of the London Energy Efficiency Fund, and is a Trustee of the National Energy Foundation.
He was previously a Corporate Finance Partner at Matrix Corporate Capital and, earlier, led the Extel # 1 rated New Energy and Clean Technology research team at Matrix. Steve spent over 20 years implementing energy efficiency programs for many large private and public sector organizations, including local authorities and major corporates such as Diageo (Guinness), Sainsburys and GSK. He also co-founded two energy service companies, one in the UK (which is now part of RWE npower) and one in Romania. In Romania, he also developed energy efficiency programs funded by the EU, the UNDP and USAID. Steve has over 250 publications, including two books on energy efficiency, and has been an Adviser to the UK Department of Energy & Climate Change (where he assisted in establishing the Energy Efficiency Deployment Office), China’s National Development and Reform Commission and a leading Japanese engineering company. In November 2012, he won the Energy Institute’s Individual Achievement Award.
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