: Description of the Project Development Services and the planned Investment Programme Location of the Project Development Services Province of Bergamo, Italy. 1. Location Main purposes of the Project Development Services The project development services are needed for the preparation and implementation of EE measures in public buildings and public lighting, the production and use of renewable energies through solar thermal collectors and PV, and the construction of small scale district heating networks supplied by biomass. The Province of Bergamo will support these investments in 124 associated municipalities. Description of the Final Beneficiary The beneficiary is the Province of Bergamo, located in the North of Italy. Role of the Final Beneficiary in the Investment Programme to be prepared The Bergamo Province will act as a central purchasing body both for technical support and for implementation of energy efficiency measures. The Province will be in charge of technical assistance (audit assessment, baseline, saving potential and costs identification) and support the preparation of agreements, call for tenders, contract definitions and tender awarding. The Province will also cover the auditing of the performances achieved and carry out monitoring activities. 2. Description of the Project Development Services Aims and objectives of the Project Development Services The investments foreseen will be implemented mainly through Energy Performance Contracting (EPC). For a part of the investment national subsidy schemes will be used. Most of the municipalities are of small size and have neither the capacity nor the competencies to implement a larger investment programme. In addition they have difficulties to hire new staff. Thus the Province will assume the role of a support and coordination entity for the associated municipalities making available the necessary know-how, in particular for EPC, and the preparation capacity for the planned investments. Indicative activities included in the Project Development Services (personal costs, external services, etc.) and main justification. Estimated total budget for the assistance including a detailed budget breakdown according to activities Preliminary Activities (4 months): - selection & recruitment of additional staff; - setup and selection of technical groups for energy audits & baseline identification; - legal, administrative and technical advisors selection; - set up of Steering Committee and Municipality committee; - start of search for complementary investment funding. 21/07/2015 Page 18 of 47
Core activities (20 months), repeated in a process cycle with continuous improvement for the different tenders both in public buildings and public lighting: - energy assessment and design all technical analysis needed to check buildings and define technical requirements for tenders (baselines identification, saving potential & estimation of refurbishment costs); - tenders preparation: launch, evaluation & execution; - award of the works & control work progress. In the case of biomass DHNs a preliminary assessment & design will be tendered whose output will constitute the basis for a subsequent concession tender. Support activities (36 months): - project management for the entire duration of the project; - design and implementation of a web platform for & Verification based on IPMVP protocol and in accordance with ISO 50001 - project internal communication & dissemination First step of the project will consist of the selection and the recruitment of the external additional staff which consists of: external staff: o one project assistant which will help the project manager in the operational management of FABER (this additional person figure will be recruited for the whole project duration) o two junior project assistants which will be in charge of the contact and the coordination of municipalities (these additional persons will be recruited for the whole project duration) o technical experts giving specialist assistance to Management Board in the coordination and quality assurance of energy auditing and monitoring phases (in total 45 months part-time) these energy efficiency experts will technically coordinate and validate the external audit activities in order to guarantee the homogeneity and the quality of the evaluation to be used in building and lighting energy refurbishment tenders; it will support (from a technical point of view) the preparatory and the selection phases of the tender process; o one legal and one administrative advisor giving administrative & legal support (24 advisory months part-time each) these legal and administrative experts will support the definition of tender procedure and documents both in the preparatory and the selection phases including the EPC contract design; This external staff will work in team with the director manager, the project manager and a technical officer (permanent staff of the Bergamo Province). external audit and design expertise: o public building auditors to define buildings baselines and preliminary design of EE measures (of about 450 public buildings distributed in about 100 municipalities) o public lighting auditors to define lighting baselines and preliminary design of EE measures (of about 67 municipalities) o PV plant experts to analyse capacity of buildings (roofs in particular) to host PV plants and preliminary plant design; o biomass DHN designers to define DHNs assessment and design (of 5 municipalities) The director manager is the responsible of FABER project (e.g. he is in charge of signing the contract with all the contractors). All the additional staff will report to the project manager acting on behalf of the director manager. The same is applicable also for the external assessment experts and the legal/administrative advisors. External technical experts will be included in the management board to support (on the technical side) the project manager in this task. The core activities include energy audits and designs and tenders preparation and execution. In view of limiting the risk of unsuccessful tenders, the energy audits and the resulting process of bundling are foreseen in 3 similar loops. 21/07/2015 Page 19 of 47
The energy audit and design aim is to evaluate the public buildings current energy consumptions and mode of use (baseline), their geometric and construction characteristic and possible contractual, architectural or technical restrictions, and similarly for public lighting, in order to evaluate the level of efficiency/consumption reduction technically and economically viable to define the tender minimum values (investment, efficiency, contract duration ) required. Regarding the biomass district heating networks (DHN) the external expertise will define and design the networks based on the analysis of the future DHNs customers heating demand and willingness to connect to the DHN. In parallel, in conjunction with local forest owners, studies will be carried out to define local biomass supply chains for the planned DHNs. Biomass plants and DHNs dimensioning should take into account both the specific local heat demand, the availability of sustainable biomass and the replicability of the solution for the different municipalities involved. Project staff (both project assistants and technical external experts) will be in charge of municipalities and auditors coordination in order to obtain affordable baseline definition and design for the three investment sectors. The legal, administrative and technical advisors will be in charge in cooperation with the internal administrative and technical staff for: documents preparation procedure definition EPC contract preparation. evaluation All these listed activities will profit of the experience of Milano, Modena, Chieti and Padova ELENA projects currently in progress. Specific meetings will be provided with the four project managers in order to gather suggestions and advice as well as tender documents (even if they are public available). For project internal communication purposes a web platform will be designed and implemented The Web Platform will support the project first in view of enhancing homogeneity of the auditors approach and to check project scheduling, second to monitor the performance of the efficiency measure, supporting a transparent communication between municipalities, ESCOs and Province. Each of these FABERs actors will be provided of a specific account to the Web Platform. The Web Platform consists of a software delivered by a Web Browser for different level of users (Municipalities, Province, ESCOs) and able to: upload public buildings characteristics (geometric and construction features, heating systems, architectural or technical restrictions ), energy consumptions and mode of use, and similarly for public lightings; analyse and elaborate the previous data at building, municipality and tender lot level (depending on the user restrictions rules). During the project the Web Platform will help to share, homogenize and validate audit input and output in order to help tender lots definition on the base of auditors elaborations (first phase); to store and analyse buildings energy consumptions and performances on the base of ESCO s energy management system (second phase). During the first phase this support is very helpful for the project management due to the high number of municipalities. The Web Platform with a dedicated web site will also serve for communication and dissemination activities. During the project running time this will allow inter alia to attract new municipalities, to publicise the tenders to a large number of ESCOs, and to present the achieved results and acquired experiences to a wider public. 21/07/2015 Page 20 of 47
In total, 4,326 expert days are foreseen, at an average cost (comprising junior and senior profiles) of 342 EUR/day. The cost breakdown of the expertise required is presented in the following table: Type of activities / support 1. Project management support 1.a Senior technical experts 1.b Project management assistance Person day cost rate (VAT included) 500 170 Number of person days Total 360 180,000 635 108,000 1.c Two junior assistance 143 2. Technical s 2. a Buildings Baselines and Design 2.b Lighting Baselines and Design 2.c DHN and Design 3. Administrative & Legal Support 450 450 450 675 4. & Auditing 400 5. Communication & Dissemination Total 400 1,259 180,000 889 400,000 333 150,000 200 90,000 400 270,000 175 70,000 75 30,000 4,326 1,478,000 Indicative implementation timetable for the Project Development Services, indicating the link between the Project Development Services and the Investment Programme The preparation activities will be organised in view of having three tenders cycle with two territorial lots each for the EE in buildings, including RE (i.e PV and solar thermal collectors) and in public lighting. A lot dedicated to buildings will comprise around 450 buildings in 120 municipalities. The lot for public lighting will comprise around 18 000 light columns in 65 municipalities. Preliminary activities 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 CORE: Public Building BUILDING 1,2 BUILDING 3,4 BUILDING 5,6 CORE: Public Lighting LIGHTING 1,2 LIGHTING 3,4 LIGHTING 5,6 CORE: DHNs Project Management Communication & Dissemination Web platform for Mon. & Ver. FABER dissemination to municipalities (Province level) technical requirements FABER dissemination to other interested stakeholders (IT/EU) & Verification 21/07/2015 Page 21 of 47
Applicants commitment to facilitate dissemination of experiences and results Dissemination of experiences and results will be targeted at province level to the other municipalities not included in the project. At regional level, dissemination activities will be supported by the Region of Lombardy and its subsidiary Finlombarda. Finally, at national level dissemination support is expected from the Environmental Ministry and in particular through the working group dedicated to the preparation and implementation of the SEAP, which has already endorsed the Province of Bergamo s SEAP Guidelines. The involvement of the Province of Bergamo in existing networks like Coordinamento A21 (national Agenda21 network), the UPI (Provinces National Network) and the municipalities membership in the ANCI (Municipalities National Network) will facilitate the dissemination activities. 3. Presentation of Investment Programme Location of the planned Investment Programme Province of Bergamo, Italy Description of the planned Investment Programme On the basis of SEAPs realised by of the involved Municipalities, the investment programme consists in: 1. Public Buildings (120 municipalities concerned, targeting in total some 445 buildings): works foreseen concern the improvement of the building envelope, the modernisation of the heating generation, distribution, and the building energy management and control systems. Also the increase of the indoor lighting efficiency can be included. In certain cases where financially feasible, the use of renewable energies is also foreseen. In view of making these investments more attractive for an energy performance approach, national subsidy schemes will be solicited, which would reduce the payback time. In case the subsidies will be less or not available at all the investment programme will be redesigned targeting only the measures with an acceptable payback time. 2. Public street lighting (67 municipalities are concerned with some 17,900 light posts): works planned cover the substitution of the existing lightings with more efficient technologies and the installation of voltage regulators. Energy savings of 45% are expected. 3. Biomass fed district heating networks (5 municipalities concerned): The investment programme includes also the construction of 5 small scale biomass fed district-heating networks in municipalities in mountain areas, not served by the gas network. The pre-feasibility studies carried out show an acceptable financial performance. Biomass supply should come from the surrounding forests. 4. PV in public buildings: on around 280 buildings PV plants will be installed with an average capacity of 14 kwp. The electricity production will be used to reduce the electricity purchase of the municipality. Joined tenders are foreseen with point 1. The total expected investment amount of EUR 54.1m is planned to be implemented through the energy performance contract approach using ESCOs for the investments in public buildings and public lighting. For the district heating network the concession approach is the preferred option. The implementation set up for PV foresees a partnership with private companies (e.g. ESCOs). Description of the approach to implement the Investment Programme The Province will be responsible for the entire programme acting as central purchasing body, pursuant to an agreement with the Municipalities. Lombardy Region acts as a guarantor in case the status of the Province institution will change. All the 124 municipalities involved in the project have already formally delegated to the Province (through a municipal resolution) this coordination role and the role of the central purchasing body. The in-house company Finlombarda of the Lombardy Region will cooperate in 21/07/2015 Page 22 of 47
technical assistance activities (by its Energy Unit) and in searching for best conditions for ESCOs to benefit from funding sources (i.a. EIB or commercial banks). The EPC with performance guarantee will state that payments from the municipalities to ESCOs are proportional to the performance results and thus should be off-balance for municipalities (in accordance with the Eurostat decisions). The fuel supply will be separated from the EPC contract. The municipalities will purchase fuel and electricity through the national platform for public procurement (CONSIP) or other platforms that guarantee equivalent or better conditions. The cooperation between Bergamo Province, Lombardy Region and Finlombarda has been fixed in an institutional agreement. Both partners will share and validate the key strategic project decisions with the Province in the Steering Committee. Finlombarda as in-house company of Lombardy Region will make available additional technical, financial and legal support if required, which is not covered by the ELENA grant. The municipality commitment has been already stated through a municipal council declaration of interest on renovation interventions on specific public buildings and/or public lightings (all under their property and not being under contractual restrictions) and/or biomass district heating networks. (Municipalities concerned: Brembilla, Foppolo, Piazzatorre, Serina and S. Omobono). During the assessment phase the municipalities will be consulted as main stakeholders in the confirmation of the priority settings for the pre-selected public buildings. During the tendering phase the municipalities will be consulted as main stakeholders to check the requested ESCO s requirements and proposed EPC contract, and during the tender assignation to judge the proposed efficiency measures. The contract signature will be done by each municipality as final step of the process. The case of biomass district heating networks is treated in a specific way: the instrument of concession is the reference option currently considered for the activities of preliminary and detailed design, construction and operation of the district heating network, including heat supply service. The concessionaire shall bear the cost of the investments (e.g. biomass plants and district heating network) and will receive income from the heat sale revenues for the whole duration of the concession and any incentives provided for by law. Concerning the planned PV plants the approach foreseen is to make available rooftops of public buildings to private companies (e.g. ESCOs). The selected partner will be responsible for the building, management and maintenance of the PV plant, being paid by the municipalities through savings in their electricity bill. Expected results in terms of increase in energy efficiency, decrease in energy consumption, renewable energy production and reduction of greenhouse gas emissions The estimated impacts are shown below: Investment sector Energy saved (in GWh/y) RE generated (in GWh/y) CO 2 emissions avoided (in tons/y) EE in buildings (incl. solar thermal) 22.0 0.6 4,600 EE in public lighting 7.1-2,900 Biomass district heating - 13.0 2,100 networks PV in buildings 4.2 1,700 Total 29.1 17.8 11,300 Expected other relevant results In addition to significant energy savings and CO 2 reductions, the investment programme is expected to generate the following results: Improvements of buildings indoor comfort and street lighting quality. Life span extension of buildings and improvements/economic savings in the operation and maintenance of buildings. 21/07/2015 Page 23 of 47
Employment created estimated at approx. 350 FTE years. Capacity building through skills development and training of local technicians in best practices and innovative and energy efficient technologies and methods. Increasing the demand for locally produced biomass. It should be noted that these are initial estimates and the figures will be updated throughout the project implementation. Expected overall investment cost The total amount of investment is estimated at EUR 54.1m distributed as follows: Investment sector Investments (MEUR) EE in public buildings (incl. 26.0 solar thermal) EE in public lighting 11.0 Small scale biomass district 9.1 heating networks PV in public buildings 8.0 Total 54.1 Preliminary financing plan for the Investment Programme For the energy refurbishment of buildings and for street lighting renovation, the Energy Performance Contracting with a result guarantee through ESCO will be used. The financing (total CAPEX EUR 37m) will thus come mainly through the ESCO. For some of the investments national incentives (Conto Termico and White Certificates) might reduce the upfront investment amounts (initial estimations of grant amount for the building refurbishment reaches 30% of investment). In the case of the biomass district heating networks the instrument of concession will be implemented, which will include also the financing of the investments through the concessionaire. The construction of the PV plants will be done through private companies (e.g. ESCOs). The selected company will be responsible for the installation, management and maintenance of the plants. It will be paid through the savings on the electricity bill of the municipalities (possibility of net metering according to Italian regulation). In addition the financial value of white certificates related to PV plants will reduce the upfront investment amount for the private company. Preliminary implementation timetable for the Investment Programme Due to the high number of public buildings and municipalities involved, in the scheme six tenders (each including two separate lots of territorially contiguous aggregations of municipalities) are planned for both public buildings and public lightings. Following the scheme implementation phase the award of the first public building tender will start in month 17 until the end of the project. Thanks to a short preliminary phase and to the partial overlapping of the audit phases, all the tenders will be awarded at the end of the second year. An intermediate check of the investment program (milestone 1) is provided at month 20 when 2 public building and 2 public lighting tender lots should be awarded. 21/07/2015 Page 24 of 47
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 Preliminary activities CORE: Public Building BUILDING 1,2 BUILDING 3,4 BUILDING 5,6 CORE: Public Lighting LIGHTING 1,2 LIGHTING 3,4 LIGHTING 5,6 CORE: DHNs MILESTONES 1 2 Two milestones are foreseen: the first in mid tender phase (month 20), when two tenders will be awarded (one buildings and one lighting) each with two lots and the second at the end of the implementation phase (month 36). Estimate of the planned investment is: at milestone 1 o 1/3 of the investment regarding public buildings o 1/3 of the investment regarding public lightings For a total investment of about 15 million equal to about one third of the total investment and a cumulated leverage factor of 19.7 at milestone 2 o Total investment regarding public buildings o Total investment regarding public lightings o Total investment regarding DHN All the investment should be implemented at this stage and the final leverage factor of 40.7 should be reached. 21/07/2015 Page 25 of 47
4. Overview table: Milestones presentation for measuring leverage factor Reporting time (end of year) Estimated budget Project Development Service Milestones for Investment Programme implementation (indicate here the part of the total Investment Programme which is planned to be launched at the indicated reporting time) Leverage factor according to phasing + milestones Staff costs [in EUR] External experts / subcontracts [in EUR] Sub-total [in EUR] Short description of area, technologies concerned 1 Estimated Identification of investor 2 total costs [EUR] Estimated annual final energy saved for EE projects 3 [in GWh] Estimated annual final energy productio n by RES 3 [in GWh] Estimated annual reduction of CO2 eq [in t] Year 1: 0 494 500 494 500 ESCO 0 0 0 0 0.0 Year 2: 0 674 000 674 000 Buildings, public lighting and DHNs ESCO 30 000 000 19.4 3.2 6 150 49 Year 3: 0 309 500 309 500 Buildings, public lighting and DHNs ESCO 24 100 000 9.7 14.6 5 150 87 TOTAL 0 1 478 000 1 478 000 54 100 000 29.1 17.8 11 300 41 Interim report (cumulated, at the end of month 20) 0 943 000 943 000 15 000 000 9.7 1.6 3 075 18 1 Specifying which main area concerned (i.e. EE, RES, transport or urban infrastructure) and which technology(ies)/measure(s) implemented 2 Indicate the final investor, the one who will order the work to be carried out 3 Indicate the main type of energy saved or produced (thermal or electrical) 21/07/2015 Page 26 of 47