Energies POSIT’IF is a Société d’Economie Mixte (SEM)—a public private company used by French local authorities to manage urban development projects particularly energy related projects. It was set up in 2013 with the support of the Ile-de-France region, Caisse de Depots et Consignations, Caisse d’Eparagne. The SEM allows public authorities to keep control of the political objectives while benefitting from private management and co-financing—it is funded by public and private finance but there is no public private contract. It operates on the competitive market and bears the commercial risk.
Energies POSIT’IF aims to increase the number of energy retrofits in the Ile-de-France region by providing comprehensive technical services (energy advice, retrofits and energy performance guarantees) and third party financing to thermally upgrade multi-unit buildings. Projects will be financed through equity, low interest debt from financial institutes and the sale of energy savings certificates—achieving a Bâtiment de basse consommation (low energy building) performance target.
Intelligent Energy Europe funding from Mobilising Local Energy Investments (MLEI PDA) was used for the initial project development phase. It funded capacity building amongst stakeholders—managers, financial institutions, construction partners, architect, etc.—to up skill and improve knowledge of energy efficiency, thermal retrofits and energy performance contracting. MLEI also supported technical and socio-economic assessments of multi-unit buildings to ensure their suitability for the energy performance contracting model.
Currently, there are over 4 700 million residences in the Ile-de-France region of which 72 % are multi-unit buildings—7 out of 10 buildings were built before the 1970s. Over 50 % of these residences are energy classed as E, F or G. They tend to be poorly insulated, hard to heat and an average household spends € 650/person/annum on domestic energy bills. Energies Posit’IF estimates that an investment of approximately € 250/person/annum is required to finance the thermal retrofit energy efficiency works in these buildings.
How it works?
Once a condominium is identified—through MLEI funded assessments or by request of the condominium General Assembly—a feasibility study is carried out to determine the extent of the thermal upgrade required. Upon completion an investment programme is presented to the condominium General Assembly detailing the proposed retrofit measures, the estimated energy savings and the financing plan.
If the programme is accepted by the General Assembly, Energies Posit’If implements the retrofit works—subcontracting the works to relevant consortium partners—and guarantees the savings for the duration needed to repay the upfront investment under energy performance contracting. The consortium of partners includes architects, construction contractors, ESCOs and engineers.
At the beginning of the energy performance contract Energies POSIT’IF indicates energy savings, for example 40-50 %, and within a year of project completion they evaluate the actual savings. If these actual savings do not meet the indicted targets Energies Posit’If evaluates where the fault lies. For example, if the fault is the building envelope the construction partner repairs it. Initially Energies Posit’If will avoid condominiums with financial or governance complexities.
The proposed financing structure for multi-unit buildings is: typically 50 % owners’ self-financing, 15 % pre financed grants by Energies POSIT’IF (including white certificates) and 35 % third party financing from Energies POSIT’IF. Tax subsidies and tax rebates will also be used. It is estimated that all financed measures should achieve energy savings of 40 % or more. The internal rate of return in multi-unit buildings is expected to range around 4 to 9 % over a 15 to 20 year term. A single programme is estimated to cost € 2 million—only condominiums of 50 apartments or more will be targeted. So far € 5.2 million has been raised in equity but the aim is to reach € 14 million.
Presently, Energies POSIT’IF is at different stages of assessment and negotiation with over 20 multi-unit buildings in the Ile-de-France region. By the end of the year, it expects to start work on 4 projects—buildings of over 400 units. The company also intends to make acquisitions in renewable energy projects—biomass, wind and geothermal.
‘Controlling energy consumption and energy production at the local level are major challenges for the Ile-de-France region, which is 90 % dependent on imported resources. This costs households through increased energy bills and costs the municipality to import non-renewable resources at the expense of the economic development of the territory,’ said Jean-Paul Huchon of the Regional Council of Ile-de-France.