Guest blog post by Panama Bartholomy, Project Director at the Investor Confidence Project Europe.
At the recent Investor Days event, I had the personal privilege of hosting three panels of representatives from the financial sector (Deutsche Bank, Amber Infrastructure, UK Green Investment Bank, Joule Assets, European Investment Bank, SUSI Partners, and Triodos Bank) focused on how to make money flow and enable mass-scale energy efficiency investment.
Never before have so many large and small, public and private investors come together to find ways to give us the financing we need to meet our building renovation goals. Their consensus is a crystal clear message to the efficiency supply community: The lack of a standardised process for developing and underwriting projects is the biggest barrier to confidence in our industry. The financiers have finally made a clear ask: How will the energy efficiency community respond?
For our part, the Investor Confidence Project (ICP) Europe responded by releasing a robust set of project guidelines – or Building Performance Protocols – aimed at unlocking the economic potential of the European retrofit market, estimated at between EUR 60-100 billion per year. The protocols define European best practices for predicting energy savings, optimising performance, and monitoring the results of energy efficiency investments.
And the market is ready: ICP Europe protocols are currently being incorporated into energy efficiency renovation projects and programmes in Portugal, Germany, and the UK. Even though ICP Europe is just one year old, the European Commission has already described it as “having the potential to transform the market.”
Along with policymakers, business, finance and industry are also enthusiastically supporting the initiative. Stephen Barker, Head of Energy Efficiency and Environmental Care at Siemens in the UK, said his company was “involved in the Investor Confidence Project Europe for purely business reasons: we believe it is a necessary step to unlock the capital our sector requires to meet Europe’s energy goals.” And Laurent Kraif, Managing Director of Électricité de France S.A.’s (eDF) ESCO Department, who recently joined ICP Europe’s Steering Group, said “eDF believes that its customers and the European community need a dramatic increase in high quality energy efficiency renovation projects. To do this we need to improve savings, increase investment and collect and use better project data. The Investor Confidence Project Europe is providing the tools and guidance that could facilitate many of these changes in the marketplace and I look forward to adding eDF’s insights into their operations and plans.”
The Investor Confidence Project, led by Environmental Defense Fund, originated in the United States. The ICP system, fully completed and being deployed into U.S. markets, is well on its way to validating the business case and attracting third party financing into retrofit projects. ICP’s Investor Ready Energy Efficiency™ (IREE) certification is drawing attention from utilities and building owners across the country that see the value in a shared set of performance-based standards to increase confidence in energy savings; savings that are increasingly aligned with energy efficiency policy objectives.
In the coming weeks, ICP Europe will be launching an Investor Network. The network will provide training and quality assurance, and issue project development specifications to enable Investor Ready Energy Efficiency™ projects that give investors the confidence needed to put their cash into energy efficiency.
It’s time for energy efficiency to realise its potential. With ICP’s protocols, the European market now has the tools it needs to communicate the safety of standardised projects and manage owner and investor risk. The resulting investment in projects will build the business case needed bring institutional investors into the game. Only then can we start to see the path towards meeting Europe’s climate and energy goals.
I invite you to support ICP Europe and help make energy efficiency a global asset class by joining the ICP Europe Ally Network.