NETCOM: NETworking the Covenant of Mayors Financing Sustainable Energy Action Plans: How to combine EU Structural and Cohesion Funds with innovative financing instruments and Energy Performance Contracting? Almada s Less Carbon Climate Fund Levering local resources together with structural funds for sustainability João Cleto 1, Catarina Freitas 2 and Carlos Sousa 1 1 Local Energy Management Agency of Almada 2 Head of the Sustainable Environmental Management and Planning Department City Council of Almada, Portugal Open NETCOM Days: NETworking 11 th European the Week Covenant of Regions of Mayors and Cities Training and Networking Event Brussels 910 th th October 2013
Brussels Almada
Lisboa Almada Almada Lisbon Metropolitan Area Area 72 km 2 180.000 inhabitants
challenges?
challenges
challenges GWh c TWh Almada Portugal World
challenges 2011 ~150.000 toe (6,3 x 10 6 Gj) Almada (toe, tonne of oil equivalent)
challenges 2011 ~150.000 toe (6,3 x 10 6 Gj) Transport Residential Services Comércio/Serviços Industry 37,1% 23,6% 18,0% 21,3% Almada (toe, tonne of oil equivalent)
challenges 2011 ~150.000 toe (6,3 x 10 6 Gj) Almada (toe, tonne of oil equivalent)
challenges 2011 ~150.000 toe (6,3 x 10 6 Gj) Almada
Almada and CoM Almada and the Covenant of Mayors: A long path of sustainable energy policies Proactive Attitude! In 1999 created the Energy Agency local forum for energy sustainability and technical partner In 2001, Almada took the lead and launched the Local Climate Change Strategy Develop a methodological approach Identify international, European and national instruments and strategies Climate Change Strategy in City Council Annual Corporate Plan
Almada and CoM Almada and the Covenant of Mayors: A long path of sustainable energy policies Proactive Attitude! In 1999 created the Energy Agency local forum for energy sustainability and technical partner In 2001, Almada took the lead and launched the Local Climate Change Strategy Develop a methodological approach Identify international, European and national instruments and strategies Climate Change Strategy in City Council Annual Corporate Plan
Climate change integrated into political process: Almada and CoM Local Development Strategy Local Agenda 21 Climate Change Strategy
Almada and the Covenant of Mayors: Step by Step Almada and CoM Establishing partnerships and develop in-house expertise (Local Energy Management Agency, ICLEI, Energie-Cities, R&D institutions, ) Joining CCP Cities for Climate Protection Campaign (Dec. 2001) Subscription of Cities for Climate Protection 5 Milestone Program Signed the Covenant of Mayors
Almada and the Covenant of Mayors: Step by Step Almada and CoM Establishing partnerships and develop in-house expertise (Local Energy Management Agency, ICLEI, Energie-Cities, R&D institutions, ) Joining CCP Cities for Climate Protection Campaign (Dec. 2001) Subscription of Cities for Climate Protection 5 Milestone Program Signed the Covenant of Mayors
Climate Change Strategy Framework Almada and CoM
Almada and the Covenant of Mayors: SEAP s target GHG reduction for 2020 Evolução emissões de CO2eq e impacto PAM Almada and CoM 400.000 22% reduction of GHG relative to 2006: 350.000 3% PNAEE 300.000 2% Green Electricity tco 2 eq. 250.000 Indústria 17% Municipal effort (SEAP) 200.000 Ed. e Equip. Terciários Edifícios Residenciais 150.000 Transportes 100.000 50.000 0 2006 2020 PAM
Almada and CoM Almada and the Covenant of Mayors: SEAP s target GHG reduction for 2020 Evolução emissões de CO2eq e impacto PAM 400.000 22% reduction of GHG relative to 2006: 350.000 3% PNAEE tco 2 eq. 300.000 250.000 Indústria 2% Green Electricity 17% Municipal effort (SEAP) 200.000 Ed. e Equip. Terciários Edifícios Residenciais 150.000 Transportes 100.000 50.000 0 2006 2020 PAM
Look at available options for financing Energy Efficiency investments in Almada: EU funding Financial Mechanisms Structural and Cohesion Funds (ERDF) EU grants Financial instruments ELENA, JESSICA, National Funding Local Funding
Look at available options for financing Energy Efficiency investments in Almada: EU funding Structural and Cohesion Funds (ERDF) EU grants Financial instruments ELENA, JESSICA: these are loans: bear a financial cost for the future (currently not allowed) more immediate benefits mostly for third parties, not for the Municipality National Funding: very scarce at the moment Local Funding Financial Mechanisms
Almada adopted a synergistic and mixed approach for Energy Efficiency investments based on: EU funding Structural Funds: managed at national level Applications submitted to and evaluated by national authorities can pay for equipment; EU grants: managed at European level Financial Mechanisms Application submitted directly to the European Commission or to the Executive Agency which runs the programme in question, e.g., IEE, INTERREG, FP7, LIFE+, can pay feasibility studies, dissemination and, in some cases, equipment
Almada adopted a synergistic and mixed approach for Energy Efficiency investments based on: Local Funding Almada Less Carbon Climate Fund Financial Mechanisms Finicia Municipal Fund (City Council, Private Bank, Insurance Companies) Tax reduction and other support programs for Innovation and Eco-Efficiency ( building tax)
Financial Mechanisms Almada Less Carbon Climate Fund Instrument created in 2009 to support municipal investment in energy efficiency and RES to implement SEAP s measures Supported by a budget line which internalizes the compensation of the previous year municipal CO 2 emissions
Almada Less Carbon Climate Fund How does it work? Financial Mechanisms City Council Activities Municipal Fleet Buildings and Equipments Public Lighting
Almada Less Carbon Climate Fund How does it work? Year N - 1 Financial Mechanisms City Council Activities CO 2 eq Emissions Municipal Fleet Buildings and Equipments CO 2 eq (ton) Public Lighting
Almada Less Carbon Climate Fund How does it work? Year N - 1 Financial Mechanisms City Council Activities CO 2 eq Emissions Municipal Fleet Buildings and Equipments CO 2 eq (ton) Public Lighting CO 2 cost per ton
Almada Less Carbon Climate Fund How does it work? Year N - 1 Year N + 1 Financial Mechanisms City Council Activities CO 2 eq Emissions Almada Less Carbon Fund Project Pool Municipal Fleet A Buildings and Equipments CO 2 eq (ton) Budget for RES and RUE B Public Lighting CO 2 cost per ton C
Almada Less Carbon Climate Fund How does it work? Year N - 1 Year N + 1 Financial Mechanisms City Council Activities CO 2 eq Emissions Almada Less Carbon Fund Project Pool Municipal Fleet Buildings and Equipments CO 2 eq (ton) Budget for RES and RUE A B External evaluation of CO 2 emission reductions Public Lighting CO 2 cost per ton C
Almada Less Carbon Climate Fund Some examples Telemanagement system for the public lighting in Almada Solar hot water in 100% municipal sports facilities 100% LED traffic lights Energy efficient lighting and HVAC systems in municipal buildings Energy certification of municipal buildings Electric vehicles for the municipal fleet Efficient lighting in historical monuments Financial Mechanisms
Av. 23 de Julho 100 80 60 40 20 0 18:00 18:50 19:40 20:30 21:20 22:10 23:00 23:50 0:40 1:30 2:20 3:10 4:00 4:50 Escurecer 5:40 LIGA RELÓGIO 6:30 Noite Fechada 7:20 Proposta Antes das Intervenções Actual Raiar da Aurora Dia Claro NASCIMENTO DESLIGA RELÓGIO
Almada Less Carbon Climate Fund Advantages? Cross sectoral/department alignment with RES and RUE investment Motivation, motivation, motivation! Technical screening verification of broader projects Financial Mechanisms
Financial Mechanisms Finicia Local Fund Created in 2012 Aiming to diversify Almada s economic activities Capacitating new entrepreneurs, including new green business Financing investments up to 45.000 with FINICIA (Private Bank, Insurance Companies, City Council) 80% private bank (low spread) 20% municipal fund (no interests) Reinbursement 3 years (min) to 6 years (max); 2 years grace period
Financial Mechanisms Finicia Local Fund Some examples New green business: customizing and repairing bicycles, located in a recent pedestrianized street
Mixed Approach Almada s mixed appoach to use the European and Local funds in the most efficient way, EU funding Structural and Cohesion Funds + EU funding EU grants + Local Funding Relevant and comprehensive cost-effective measures
FLEXIBUS, Inclusive Mobility System of Almada Preparation phase: Feasibility Study for the creation of the service and dissemination materials Co-financed by INTERREG IVC (85%): FLIPPER Project Implementation phase: purchase of 2 electric mini-buses Co-financed by Structural Funds (50%) Almada Less Carbon Carbon Fund (50%)
EcoEnLight, Telemanagement system for the public lighting in Almada + 100% LED traffic lights Base Study + Pilot phase: testing in the feasibility of the new system Co-financed by ICT-PSP Information and Communication Technology, Policy Support Programme (50%): BEST Energy Project Implementation phase: purchase materials/equipments to cover 5% Co-financed by Structural Funds (50%) Almada Less Carbon Carbon Fund (50%)
EcoEnLight, Telemanagement system for the public lighting in Almada + 100% LED traffic lights SEAP Measure: MM4 Public Lighting Telemanagement system and flux regulation for the public lighting in Almada Target Potential reduction Cost/Benefit Target: all 29 700 light points of Almada (562 TP) Description: procurement and installation of a telemanagement system for public lighting, allowing flux regulation and remote management Scenario 5% of the light points; Scenario 100% of the light points. Scenario 5% Reduction of consumption: 583 MWh/year Reduction of emissions: 0,2 kt CO 2eq /year Scenario 100% Reduction of consumption: 6.880 MWh/year Reduction of emissions: 2,7 kt CO 2eq /year Scenario 5% Investment: 446 k ROI: ~6 years Scenario 100% Investment: ~16 M ROI: variable
EcoEnLight, Telemanagement system for the public lighting in Almada Municipal Buildings Equpments 29% Fleet 2% 69% Street Lighting 2% Energy Savings (kwh/year) Cost Savings ( /year) CO 2 Emissions Reduction (kg CO 2 eq/year) Investment ( ) ROI (years) 315 006 JJ 44 508 JJ 117 235 JJ 185 000 K 4,2 JJJ
HERB, Holistic Energy Retroffiting of Buildings R&D + testing: testing state-of-the-art retrofit technologies in holistic perspective in social housing Co-financed by FP7 Seventh Framework program (~50%): HERB Project Almada Less Carbon Carbon Fund (~50% equipment)
Grants or loans?
Evaluate Ancillary Benefits Increased comfort, quality of life
challenges?
Thank you for your attention! joao.cleto@ageneal.pt cfreitas@cma-m-almada.pt