build upon: initial commercial buildings sector workshop
TRANSCRIPT
Co-Creating Ireland’s National
Renovation Strategy – V.2
Dublin, 12th April 2016
Pat BarryExecutive Director - IGBC
#BuildUpon
Pat BarryExecutive Director - IGBC
#BuildUpon
#BuildUpon
Agenda
09.00 Session 1 – Setting-up the Scene
10.30 Coffee Break
10.50 Session 2 – Retrofitting, why it matters?
12.45 Lunch Break
01.45 Session 3 - Managing Tenants’ Expectations –Owner/Investor Challenge
03.10 Coffee Break
03.30 Session 4 – Scaling Up Deep Renovation
05.00 Closing Session
05.20 Event Ends
#BuildUpon
Jim ScheerProgramme ManagerEnergy Modelling Group - SEAI
#BuildUpon
Scene setting:
Towards large-scale
renovation in the
commercial buildings
sectorJim Scheer
SEAI
April 2016
Target interactions
Accelerated action
€700m
annual
savings
Advice and
mentoring
to over 3,000
SME’s
160 largest
industry
users
activated
Over
300,000
homes
upgraded
270
community
based
projects
Building
regulations
Public sector
programme
Tax
measures
How to?
How do we accelerate
uptake of energy
efficiency across the
economy?
We know..• There is no silver bullet
• It does not happen by itself
Finance
Different measures are needed to
over come different barriers
Information
Split
incentives
‘Hidden’
costs
Better data and
analysis …
Commercial buildings survey - Stock
Commercial sector savings potential
Consumer behaviour - Commercial sector
Action!
Existing programmes and measures
• Large Industry Energy Network (LIEN)
• Energy Agreements
• €70 million Energy Efficiency Fund
• Audits required under EU EE Directive (S.I. 426)
• Energy contracting / ESCOs
• Public sector programme
• Energy efficient design methodology …
EXEED Certified
Grants just
launched…
Policy recommendations
€
€ €
€ €
Investment
Value of savings+ Health /wellbeing,
productivity
+ Competitiveness
+ Reduced import bill
+ more…
Unlocking the multiple benefits
Target
achievement
NOW
Risks of
inaction
Net savings €8 billion
Government +€1 billion
Multiple benefits
Lost competitiveness
Import reliance
EU fines in 2020
2020
The Sustainable Energy Authority of Ireland is partly
financed by Ireland’s EU Structural Funds Programme co-
funded by the Irish Government and the European Union.
Supporting a powerful national
renovation strategy, based on
targeted action … delivered by
passionate people.
More information at www.seai.ie/
Marion JammetBusiness Development ManagerIGBC
#BuildUpon
Co-creating Ireland’s National Renovation Strategy (2017-2020)
Tuesday, 12th April 2016
#BuildUpon
#BuildUpon
#BuildUpon
I. Co-creating an ambitious national renovation strategy for Ireland (2017 – 2020)
II. Renovating Ireland’s commercial buildings stock: Barriers & Opportunities
#BuildUpon
#BuildUpon
2011 2012 2013 2014 201
5
2016 2017 2018
.
Better Energy
Finance
Workshop on 1st
Renovation strategy
White paper on
energy
Innovation
projects
developed from
Build Upon
Art. 4 Energy
Efficency
Directive
Renovation task
group
2nd version to be submitted by 30th April 2017
#BuildUpon2016
#BuildUpon
#BuildUpon
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30 Experts
7 Sectors
3 Questions
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Q.1 In your opinion, what are the main barriers to large scale deep
renovation in the commercial buildings sector?
Q.2 What kind of changes are necessary for large-scale deep
renovation to happen in the commercial building sector?
Q.3 What measure(s) have the most potential for
implementation in Ireland in a period of 5 to 15 years for
maximal impacts?
#BuildUpon
Q.1 In your opinion, what are the main
barriers to large scale deep renovation
in the commercial buildings sector?
#BuildUpon
No incentive for tenants to carry out any upgrades
Deep renovation Cost
Lack of regulatory requirementsPayback Times
Lack of understanding of the benefits associated with deep renovation Cheap Energy
Lack of understanding of the process
Energy tariffs Competing priorities
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Q.2 What kind of changes are
necessary for large scale deep
renovation to happen in the commercial
buildings sector?
#BuildUpon
Minimum energy efficiency standards
Linking business charges/taxes to energy
efficiency
Information on the benefits of deep-renovation
Using tax incentives
Better enforcing existing legislation
Awareness campaigns targeting businesses
Government backed low interest loans
Deep Renovation Guidelines
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Q.3 What measures have the most
potential for implementation in Ireland
in a period of 5 to 10 years for maximal
impacts?
#BuildUpon
Tax Incentives
Incentivised schemes
Mandatory schemes
Penalties for non-compliance
Legislation to ensure buildings of a certain
age / type are renovated to a certain standard
Tools to measure retrofit performance & increase
investors confidence
Guidelines
Low cost technologies / measures with short payback
period
Collaborative business Models
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Thank you
Marion Jammet
www.buildupon.eu/ireland
01 681 5862
This project has received funding from the European Union’s Horizon 2020 research and
innovation programme under grant agreement No 649727.
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Coffee Break
Session 2
Retrofitting, why it matters?
#BuildUpon
Building Social Potential for Deep Renovation
BUILD UPON: Co-creating Ireland’s National Renovation Strategy (2017-2020) Workshop 1: Initial Commercial Buildings Sector Workshop April 12 2016, Ocean’s 11, Dublin
Katy Janda,
Environmental Change Institute
Oxford University
Overview
Business as Usual
– Technical & economic potential for change
• Market transformation
– Penalties
– Incentives
– Information
Business as Unusual
– Social Potential for change
• Market transformation
– Citizen science
» Polisdigitocracy
– Building communities
– “Middle-out” pathways
The buildings sector offers the largest low-cost carbon reduction potential in all world regions by 2030
Figure SPM.6: Estimated sectoral economic potential for global mitigation for different regions as a function of carbon price in 2030 from bottom-up studies, compared to
the respective baselines assumed in the sector assessments. A full explanation of the derivation of this figure is found in Section 11.3.
We have the technology…
Source: Jan Barta, Center for Passive Buildings, www.pasivnidomy.cz
0
50
100
150
200
250
Stávající zástavba Pasivní dùm
celk
ová e
nergie
[kW
h/m
2a]
Domácí spotøebièe
Vzduchotechnika
Ohøev TUV
Vytápì ní
- 90%
- 75%
Buildings are socially and culturally
“embedded” (for ill or for good)
locality is unimportant
energy can be squandered
disconnectedness is normalDavid Orr, “Architecture as Pedagogy” Orion Afield: Working for Nature and Community, v3 n2 p16-19 Spr 1999
static boxes
beyond our control
may not belong to usJanda, K. B. 2011. "Buildings Don't Use Energy: People
Do." Architectural Science Review 54 (1):15-22.
The Existing Energy Efficiency Ideal:
Technical Potential (and its progeny)
The Efficiency
“Gap”
[email protected] & Learning Stories, ECEEE
2013 Janda & Topouzi Page 58
Why do we need to broaden the idea of
energy savings potential?
Insanity:
Page 59
…doing the same
thing over and over
again and expecting
different results.
Albert Einstein
[email protected]@ouce.ox.ac.uk
Buildings are dynamic,
sociotechnical systems
Building design
Energy
services
Occupant behaviour
Site &
environment
Source: Gavin Killip, ECI
Behavior Can Trump Design
Source: Keesee, M. 2005. “Setting A New Standard - The Zero Energy Home Experience
In California” ISES 2005 Proceedings
Proper use
Some Problems…
• Information deficit model doesn’t work
• Attitude / Behavior / Change model doesn’t work
• “Smart” may not equal “proper”
• And then…
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
DECs
Green Leases
Is “technical potential” the right target?
Hero & Learning Stories, ECEEE 2013 Janda & Topouzi
Page 68
Social potential
vs.
• Things some people do anyway
• Existing social change pathways
People as Active Participants
Ladder of Citizen Participation (Arnstein 1969)
Nudge
Feedback
Google Ngram Viewer English Language Corpus
Citizen
Consumer
1910 2005
1970 2008
Citizen
Consumer
User
Christmas Bird Count at Lake Como, 1963, Fort Worth Audubon Society (http://library.uta.edu/spco/timeframes/christmas_bird.html)
citizen SCIENCE
Interested Citizen
• Has data
• Cannot understand or analyze it
Building Expert
• Needs data
• Can provide context and analysis
Stakeholder Engagement – the behaviour literature
Source: WBCSD 2009
organization
individual
Groups
Organisations
Buildings
Janda, K. B. 2014. "Building Communities and Social
Potential: Between and Beyond Organizations and
Individuals in Commercial Properties." Energy Policy 67
(April):48-55.
Cool Biz Corporate Social Responsibility
Intensive & Multiple Uses
Green
Leases
Middle-Out
National Governmen
t
Citizens
Janda, K. B., & Y. Parag. 2013.
"A Middle-Out Approach for Improving Energy Performance in Buildings." Building Research & Information 41 (1):39-50.
Missing Middle (s)• Local government• Utilities• Community groups• Building professionals• Congregations
Parag, Y., & K. B. Janda. 2014. "More than Filler: Middle Actors and Socio-Technical Change in the Energy System from the "Middle-Out"." Energy Research and Social Science 3 (September):102–112.
Summary & Conclusions
• Technical potential is an ideal, not a reality– Even with “proper” and “smart” behavior
• Social potential is a different ideal– Offers different opportunities through
• Citizen science (polisdigitocracy)– might increase engagement and understanding of both
experts and non-experts
• Building communities (not just buildings)
• Middle-out change– Expertise used for public good
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Lunch Break
Session 3
Managing Tenants’ Expectations Owner/Investor Challenge
#BuildUpon
CKIW
WORKING with
Infrastructure Creation of Knowledge and Energy strategy Development
http://www.energy.ox.ac.uk/wicked/
A WICKED approach to better building performance: connecting tenants and landlords
Katy Janda, Environmental Change Institute, Oxford UniversityWICKED Co-Investigator and Research Director
BUILD UPON: Co-creating Ireland’s National Renovation Strategy (2017-2020) Workshop 1: Initial Commercial Buildings Sector Workshop April 12 2016, Ocean’s 11, Dublin
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Common claims about energy efficiency…
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
DECs
Green Leases
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
WICKED’s perspective: It isn’t easy being “green”
A ‘wicked’ problem (Rittel & Webber 1973) is:
Complex and interdependent
Difficult to solve (may be difficult to recognize)
Addressing one aspect of a wicked problem may reveal (or create) other problems
Energy use is a WICKED sociotechnical problem: The retail sector is diverse and complex.
One size will not fit all.
Technological solutions must fit organisational characteristics
Top-Down
Analyticsof the Data Rich
Learning
from the
Middle-Out
Bottom-Up:Enriching the ‘Data Poor’
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
14 July 2015
The WICKED challenge: what new information and tools can help different segments of the retail sector develop proactive energy strategies?
InfrastructureTechnical
Organisational
Legal
Creationof
KnowledgeEnergystrategy
Development
Working with…
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
WICKED time frame July 2014-16, partners
14 July 2015
In advanced discussion:
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
One size solution will not fit all.What about 6 sizes…?
14 July 2015
WICKEDMarket segments
Owner occupiers Landlords Tenants
Data RichAMR + energy
managers
Type A
Type B
Type C
Data PoorManual meters, no energy managers
Type D
TypeE
TypeF
Leased Space
Best
practice
leasing
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
‘Greener’ leasing practices: why?
14 July 2015
Traditional Leases: problematic environmental practices
‘Split incentives’ $
Landlord invests in plant, equipment, building fabric; tenants pay energy costs
My
energy
bills
My
building
landlord
tenant
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
‘Greener’ leasing practices: why?
14 July 2015
Traditional Leases: problematic environmental practices
‘Split incentives’ $
Adversarial relationship: ‘utility maximising’
Rent is
too
expensive
Need to
increase
rent!
landlordtenant
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
‘Greener’ leasing practices: why?
14 July 2015
Traditional Leases: problematic environmental practices
‘Split incentives’
Adversarial relationship
Ignore environmental issues
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
‘Greener’ leasing practices: why?
14 July 2015
Traditional Leases:problematic environmental practices
Greener Leases: environmental preservation and opportunity
‘Split incentives’ ‘’Green improvement” clauses: example, tenant allowed to upgrade and reap savings benefit; shared costs
Adversarialrelationship
Working together: duty to co-operate in relation to energy management and sustainability
Ignore environmental issues
Data- sharing
Maintain energy ratings
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
14 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Landlords leading tenants
17 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
17 July 2015
My core
business
My
building
Building
performance
landlord
tenant
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
17 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
The promised land (?) indoor environmental quality
Improving: noise, air quality, odor, visual acuity
Energy demand response, localized control
Leads to: Increased productivity
Decreased presenteeism
Reduced absenteeism
17 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Landlords leading tenants
Pros:
Builds trust
Builds learning
Builds expertise Landlords
Tenants
Builds value E.g, GRESB
Reduces environmental impacts And regulatory costs
Cons:
May not be quick wins because scale matters Tenants are different
Buildings are different
Higher resolution information may expose “failures” in current practice in particular places Landlords/FMs could learn
from “high reliability” organizational practice
17 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
BREAK
14 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
14 July 2015
Janda, K. B., S. Bright, J. Patrick, S. Wilkinson, & T. Dixon. 2016. "The evolution of green leases: towards inter-organizational environmental governance." Building Research & Information. DOI: 10.1080/09613218.2016.1142811..
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
M&S
800 stores in UK + 400
overseas
Governed by “Plan A”
sustainability objectives
Announced “green lease”
policy in 2013
70 MOUs with existing “Better
Building Partnership” landlords
Learning
from the
Middle-Out
14 July 2015
CGreen Leases for multi-national retailer (data rich tenant)
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Findings 1: What a green lease is and does…
Model green clauses promoted by UK and Sydney ‘Better Buildings Partnership’ (BBP) industry groups contain: Varying levels of ambition, specificity and
enforceability Only the Sydney BBP has a model green clause
enabling the landlord to recover the cost of environmental improvements through service charges
Adopted green clauses in the UK and Australia: Tend to be broad and unenforceable Include very general commitments:
to improve environmental performance to cooperate (e.g., share data about
environmental performance)
14 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Findings 2: Who tends to use green leases?
WHO? Across the UK and Australia, green leases are used by large powerful
organisations. Generally led by landlords, particularly BBP members Exceptions:
The Australian government requires green leases for its offices
Marks & Spencer (M&S) is implementing a green lease & MoU policy across its the UK properties
WHERE?
More prevalent in the office sector than in the retail sector
More prevalent in prime properties than in sub-prime properties
14 July 2015
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Findings 3:
Green leases have more symbolic value than material impact
Lease clauses, including green ones, appear to have little relevance to day-to-day operations
Early adopters suggest the negotiation process provides a platform for discussion and cooperation
14 July 2015Janda, K. B., S. Bright, J. Patrick, S. Wilkinson, & T. Dixon. 2016. "The evolution of
green leases: towards inter-organizational environmental governance." Building
Research & Information. DOI: 10.1080/09613218.2016.1142811.
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Conclusions and Next steps
14 July 2015
Room for voluntary
improvement
Tenant
Business as Usual Capacity to Improve
Landlord
Business as Usual
Capacity to Improve
XTenant
Leads
landlord
(e.g, M&S)
Landlord
leads (?)
tenant
Green leases(co-evolution of
improvement)
W ICK
EDhttp://www.energy.ox.ac.uk/wicked/
Thoughts for further research
14 July 2015
My core
business
My
building
Building
performance
landlord
tenant
http://www.energy.ox.ac.uk/wicked/
#BuildUpon
Coffee Break
Session 4
Scaling Up Deep Renovation
#BuildUpon
BUILD UPON: Co-creating Ireland’s National Renovation Strategy (2017-2020)
Workshop 1: Initial Commercial Buildings Sector Workshop 12th April 2016
Ocean’s Eleven, Google Docks, Barrow St, Dublin 4
Scaling Up Deep Renovation
Fiona Tutty MSc BSc, HDip – on behalf of SEAI
Overview of this Session
• Introduction to Scaling Up Deep Renovation (3.30pm to 3.45pm)
– The Investment Gap
– Comparing Models
• World Café Discussion (3.45pm to 4.20pm)
– Breakout groups to discuss the Irish context
– Feedback – 5 mins each (4.20pm to 4.50pm)
The Investment Gap
Upscaling investments in energy efficiency and renewable energy is a major challenge to meet the EU’s energy and climate targets for 2030 and beyond.
The Challenge
IEAThe Investment Gap
EU: €100bn investment needed to achieve energy efficiency targets
The Investment Gap
Types of Financial
instruments
Loans
Guarantees
Equity
Addressing lack of available financing
Providing financing at favourable conditions
Advantages of financial
instruments
Leverage effect
Revolving nature
Better quality of projects
Increasing efficiency and effectiveness of EU funding
Summary Of Financial Instruments
Key Financing Instruments
• Dedicated credit lines
• Leasing
• ESCO financing with Energy Performance Contracts (EPC)– Operational EPC
– Finance (3rd party) EPC
Emerging Structures
• Energy Service Agreements (ESAs)
• On-bill financing, investment funds, green bonds, and asset based securitization.
Summary Of Financial Instruments
ESCO Model
‘Facilitators’: a missing link for enabling clients and creating a ‘demand pull’
What Finance is Available?What Finance is Available
Why Finance Energy Projects?
• Enable project scale and deep retrofit
• Long term paybacks can be financed
• Pay for Performance - Energy contracting
• Energy services can be financed
• Use energy savings to fund the project
Standardisation Standardisation
Project Development Assistance• Structural Funds
• Horizon 2020 – allocates €194 million for Energy Efficiency in 2016 and 2017
– Market uptake measures to remove market and governance barriers by addressing financing, regulations and the improvement of skills and knowledge.
– Ratio 1:15 PDA : Project Investment
– EE-22-2016-2017:Project Development Assistance (Sept 16)
– EE-24-2016-2017:Making the energy efficiency market investible (Sept 16)
– EE-23-2017:Innovative financing schemes (Jan 17)
How to classify models
• Operational scheme– Facilitation or Integration, – With or without aggregation
• Operational Services– Marketing Assessment– Financial advice– Facilitation– Integration– Aggregation– Financing
• Financial Scheme
– Own funds
– Financial Institutions financing
– ESCO financing
– Program Delivery Unit financing
– Investment fund
How to classify models
• Implementation methodology
– Separate contracting based (SCB)
• Multiple measures, each step with different supplier, individual projects, traditional route, high internal risk
– Energy Contracting (LESC & EPC)
• One client, one contractor/ESCO, low internal risk
– Combination of above
How to classify models
Comparison of Models
• Levels of ambition
• Beneficiaries
• Impact considerations
– on the public debt
– human and financial resources,
– size of the program
Ambition Mapping
Name Country/
Region
Ownership Program
Delivery Unit
Beneficiaries
Berlin Energy
Saving
Partnerships
Federal state
of Berlin,
Germany
Public/Private Berlin Energy
Agency (BEA)
Local authorities
(95%), Health
Care Sector ,
SME’s &
Businesses (5%)
Eco’Energies CCI Nice Côte
d’Azur) France
Public CCI Nice Côte
d’Azur
SMEs
Comparison of Models
Comparison of ModelsModel Berlin Energy Saving Partnerships Eco’Energies
Date of Creation 1996 2014
Operational Framework Facilitation through PDU Facilitation through PDU
Operational Services Marketer
Facilitator
Financial advisor
Aggregator
Marketing
Facilitation
Financial advice
Implementation Model Energy Performance Contracting Energy Performance Contracting
Financial Framework Financial institutions
ESCOs
Property Owners
using Equity/own funds, EPC
Financing, Loans, Grants
Financial institutions
ESCOs
Property Owners using Loans
Grants, Utility incentives, EPC
Financing
Funding Requirements Moderate - Less than €10m less than €1 million
Model Berlin Energy Saving Partnerships Eco’Energies
Ambition Market based
26 projects with investment amount
of 53M€ with an average of
26% energy savings.
10% – 50% energy savings
Resources Moderate 5 FTE Low, Less than 5 FTE
Growth phase Mature Start-up
Scalability High High
Replicability High High
Growth Potential Large Large
Impacts Government
Balance Sheet
Moderate Low
Comparison of Models
World Café Discussion
Discussion
1. What kind of strategy would you like to see in Ireland?.
2. What do you think will be the main barriers to implementing a strategy with innovative financing in Ireland?
Checking questions
• What kind of operational model• Facilitation or Integration
• What type of finance framework
• What kind of implementation model is envisaged?
– EPC/ESCO or Single Contractor
– Who are the beneficiaries of the model?
• What’s is the level of ambition of the model?
Contact details
Fiona Tutty - Project Facilitator
00353 87 9940578
Henk Van Der KampHead of the School of Transport Engineering, Environment and Planning
- DIT
#BuildUpon
Co-Creating Ireland’s National
Renovation Strategy – V.2
Dublin, 12th April 2016
This project has received funding from the European Union’s Horizon 2020 research and innovation programme under grant
agreement No 649727.