DECC Energy Savings Opportunity Scheme (ESOS) South West Launch - Bristol - 10th November 2014

PRESENTATIONBY:PRESENTATIONBY:
Monday 10th November
Carl Reynolds
The Energy Saving
Opportunity Scheme
South West Roadshow

What we’ll cover • Business energy efficiency - challenges and
solutions
• two presentations
• Energy Savings Opportunity Scheme (ESOS)
• an introduction, discussion, questions
• Financing for energy efficiency
• presentations on the national and local picture
• The wider energy efficiency policy landscape
• an overview, discussion, questions

Objectives
To build awareness of the Energy Savings
Opportunity Scheme (ESOS) and;
The benefits of going beyond compliance by
implementing energy efficiency opportunities.
To gather feedback on the wider business
energy efficiency policy landscape.

Jes Rutter, JRP
Solutions on behalf of
Rolls Royce Business case study:
Rolls Royce

Rolls-Royce proprietary information
Trusted to deliver excellence
© 2014 Rolls-Royce plc
The information in this document is the property of Rolls-Royce plc and may not be copied or communicated to a third party, or used for any purpose other
than that for which it is supplied without the express written consent of Rolls-Royce plc.
This information is given in good faith based upon the latest information available to Rolls-Royce plc, no warranty or representation is given concerning
such information, which must not be taken as establishing any contractual or other commitment binding upon Rolls-Royce plc or any of its subsidiary or
associated companies.
The Energy Conservation Programme at Rolls-
Royce Bristol.
Jes Rutter – JRP Solutions Ltd
Strategic Energy Partner to
Rolls-Royce

The Recent Global Energy Challenge

Bristol Energy Reduction

Energy Charter
Critical Success Factors Benefits / Measures Major Risks, Assumptions
Energy Reduction Charter
Summary
Objective
This project will deliver energy consumption and cost reductions through a combination of capital
investment in viable energy hardware improvements and a management lead behavioural change to
eliminate energy waste.
Executive Sponsor P Craig Date 1/5/2014
Current Stage Operational areas of the Defence business are well advanced in terms of identification of numerous
schemes for capital submission and the ‘no-cost’ behavioral change required to eliminate energy waste.
Greater focus and management commitment is required in office locations to achieve the benefits we
know are available.
Project
Management
I Carr Version 1
Problem / Opportunity Objectives Scope
Out of hours surveys and analysis of data confirms high occurrences of
energy waste. Typically a potential cost saving of £9,000 per weekend
has been calculated in Bristol due to equipment and lighting being left
on during out of hours periods and holidays.
This needs to be addressed as a priority by all areas of the business.
This is seen as a key business opportunity that will contribute to the
‘COST’ element of the Groups 4 ‘C’s focus.
The reduction in consumption will also make a positive and measurable
contribution to the Group Green House Gas (GHG) reduction target.
To ensure all Defence businesses locations have effective
plans to eliminate occurrences of energy waste.
Gain the commitment and support of the management
community at all levels.
Increase the current ‘energy champions’ community to
mandate a member in all departments, delineated by its
physical boundaries or owner manager.
Implement written ‘shut down’ plans for weekends, holidays
and out of hour periods, in all departments.
To build upon the activities and Energy Champion roles
already in place across the business.
In Scope
All areas of Defence business.
Equipment, machinery and systems that can be
readily switched off, without impact to the
business, process or equipment.
All Personnel.
Out of Scope
Only equipment and systems which are critical
to remain live (i.e. servers, identified machinery).

Energy Charter
Executive level engagement and prioritisation of the improvement
activities in each area of the business.
Capacity of business management to actively engage with the
project.
Effective communication that positively engages all personnel.
Continuation of SME support from current external provider.
Benefits
Reduction of energy consumption and associated
costs.
Achievement of the business reduction target of
10% by 2015.
Measurable contribution by the business to
Corporate GHG reduction commitment.
Reduced negative impact on customers.
Metrics
Current business metrics aligned to Group HS&E
targets.
Major Risks
Failure to drive project requirements through the
business/site management structure.
Failure to proactively engage personnel across the
whole business.
A total absence of capital for low cost < £10k
projects.
Major Assumptions
DLT/Executive level sponsorship- Paul Craig
Delivery Approach Stakeholders Resources
Phase 1: Repeat the Energy awareness campaign with
Executive sponsor mandated actions.
Activities include the following:
Production, customisation and roll out of support tools
Build the existing, knowledgeable network of Energy
Champions
Provision across the site of SME advice and support
Build the current site community of practice
Phase 2: Capturing the thoughts and ideas of key
stakeholders the project team will be responsible for shaping
and improving a site wide improvement programme that can
be shared much wider. Activities will include the following:
Establishment of base lining and collection of performance
data
Detailed review of energy reduction schemes aimed at
submission for targeted funding
Extension of current training (Bristol) for new Energy
Champions
Identification and defining of roles for Energy champions
Refreshment of existing energy reduction schemes
Review and sharing of best practice across the business
through the current Defence Energy CoP.
Project Sponsor
Defence Leadership team
Management of all Defence business locations.
Business / function Leads
Local Energy Champions.
Ian Carr – Project Lead
Tracy Moore – Project support
SME – Jes Rutter (JRP-UK), Anthony Hatfield
(GP), Daniel Waller (GP-USA), Mukesh Jha (JCI)
Carrie Snaden – Business / Site Communications
Business senior and Line Management
Business Energy Champions

Identify Where Energy is Used and Monitor
Identify where energy use is
high and target those areas for
reductions. Identify areas
where energy use is increasing
and find out why!
Understand which
business activities
are the most energy
intensive to focus
the reduction
strategy.

Energy Project Planning & Management
Energy projects
identified, prioritised,
tracked and validated
centrally.

Energy Champions Training
Calling all Energy Champions
Defence news asked Executive Vice President Customer Services Paul Craig why he feels saving
energy is important: “The Defence Leadership Team is 100% behind this initiative. Everyone is focused on cutting costs -
but some solutions can be achieved by just flipping a switch. With very little effort required to save large costs and reduce
energy - the benefits speak for themselves.
"By following a simple checklist, switching things off or turning things down etc. before we leave our place of work every day
and especially before a longer break, we can save thousands in cash across every Defence site around the globe – so the
question is why wouldn’t we do it? We wouldn’t leave lights and lots of electrical appliances plugged in at home while no-one is
around so why do we think it is okay to do that in work? Perhaps if we all imagined the energy bill being paid for out of our own
wallets then maybe we would take a minute to switch things off before we left work.
“I have nominated myself as sponsor of a Defence Energy Charter aimed at all employees. The charter includes some key
objectives for managers in all areas and I want all managers to embrace the Charter and sign up to their requirements. A key
tool in succeeding will be the identification of Energy Champions in all areas like those pictured in Bristol recently receiving their
training certificates.”
Some of the Bristol site Energy Champions receiving their training certificates from Paul Craig.
From left: Back row: Angela Swan, Jonathan Lee, Julie Robinson, Carrie Snadden and Dave Empson. Front row: Robin Butterworth, Nick Jefferies, Paul Craig, Tracy Moore, Gary Harper
and Ashley Thurston

Energy Awareness Programme
• Poster Campaign
• Workshops & Training
• Energy Champions

Easter and Bank Holiday Shutdowns
Energy consumption
for Bristol was lower
over Easter than an
average weekend
and less than half of
a normal week day.
Bristol saved around
£4,000 when compared
to a normal weekend due
to the Easter shutdown
awareness campaign.

Easter and August Bank Holiday Shutdown
Building 184A Bristol
• Cost savings for Easter and bank holiday shutdown
between £1,000 and £3,000 per day.
• Shut down at weekend saves £4,000 per weekend or
£200,000 per year.

LED High Bay Lighting Upgrade
• Savings for the first 9 months are 800 MWh or £68k.
• Forecast 2014 energy saving £95k.
• Annual maintenance saving £80k.
• Fine tuning of controls on going.
• Payback 2.8 years.

Energy Improvement to Hot Wash Tank in NDT
Cell

Detuner Covers
• Test cells have large detuner chimneys that are open to
atmosphere.
• Significant heat loss when test rigs not running.
• Install covers on detuners to limit heat loss during
periods with no testing.
• Savings £7,500/year
• Payback 1½ months

Renewables
• We are currently exploring the installation of solar PV at
our Bristol site and are proactively seeking to utilise this
technology in 2015.
• Possible locations are on the roofs of the newest
buildings 184,185 and 186.

Thank You and Any Questions

Martin Adams, DECC
ESOS presentation

Energy Savings Opportunity
Scheme
Martin Adams, ESOS Team Leader

“Cost-effective energy efficiency
has the potential to deliver a triple
win for businesses, the
environment and the wider
economy […] ESOS can support
businesses in realising their energy
efficiency potential” – CBI
23 Energy Savings Opportunity Scheme - Emerging Thinking

Key facts about ESOS
What is ESOS?
• UK-wide mandatory energy measurement and auditing scheme
• Introduced in response to EU Energy Efficiency Directive – aims to help achieve latent
cost-effective energy efficiency potential
Who must comply?
• Large undertakings and large corporate groups across the UK.
• Target highest UK-parent but allow disaggregation
And by when?
• Qualification date - 31 December 2014
• Compliance date – 5 December 2015
• Audits must be repeated every four years (i.e. second phase ends 2019)

The consultation
25 Energy Savings Opportunity Scheme: Emerging Policy Thinking
500 300
150
Met with over 500
stakeholders
(and given presentations &
webinars to many more)
From over 300
organisations
Received 150
written consultation
responses

Key messages from consultation
Keep it simple, and understandable yet make it meaningful
• Respondents want the scheme to provide outputs that are relevant to each business
• Respondents want ESOS to add value and identify real measures that can be
implemented
Avoid duplication in existing regulation and requirements
• There a range of energy efficiency policies operating in the UK – ESOS needs to fit
• Take advantage of alternative routes to compliance – e.g. ISO50001
Minimise costs
• Allow discretion on the number of site visits required within audits
• Using internal team members for their knowledge and skills
• Only having lead auditor requiring accreditation under the scheme – but need for
whole audit team to be of sufficient quality to ensure that output is meaningful

27 Energy Savings Opportunity Scheme
0
50
100
150
200
250
300
350
400
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
Estimated energy bill savings (£m) for ESOS participants, split by sector
Other Transport Industrial Commercial
1real 2014 prices
ESOS is estimated to have a £1.6bn net benefit to the UK. This will
primarily be felt by business through lower bills

Am I part of a group
undertaking?
Do I employ 250 or
more people?
Is my turnover more
than €50m
Does the group
undertaking include in
the UK one or more
‘large enterprises’?
Is my annual balance
sheet more than €43m
AND


I am a ‘large
enterprise’
I am a ‘large
enterprise’
I am part of a
large group
enterprise
 Organisations
subject to the public
contracts regulations
2006 are exempt from
the scheme

Routes to compliance
ESOS compliant
organisation
Previous
activity that
meets ESOS
standards
DECs / Green
Deal
Assessments
ISO 50001
• ISO50001
• Display Energy Certificates
• Previous audits to ESOS
standards
And…
• ESOS compliant energy
assessments (either
conducted in-house or by
external assessor)

Conducting an ESOS assessment
1. Measure
energy use
3. Evaluate
opportunities
4. Store data
and notify
scheme
administrator
5. Implement
savings, and
further
disclosure
(e.g. in annual
report)
2. Identify
energy
efficiency
and energy
management
opportunities
Mandatory
Voluntary

32 ESOS: Next Steps
2011 2012 2013 2014 2015
Auditing activity from 6 December 2011 can be used to support
compliance for phase 1 (if approved by a lead assessor)
Key dates for phase 1
Reference period for total
energy consumption (12
months, must include
qualification date)
31 Dec
’14
Qualifi
-cation
date
5 Dec
’15
Compl
-iance
date

Use a qualified lead assessor
Professional
body
Lead
Assessor
Belongs
to a…
Which is
approved by…
Scheme
administrator
• PAS51215 – sets standard of competence for lead assessors (professional bodies will
ensure members meet this standard)

Registers of lead assessors

Any questions?
esos@environment-agency.gov.uk
https://www.gov.uk/energy-savings-opportunity-scheme-esos

ESOS Round
table discussion
At your tables:
• agree a discussion manager/leader
• agree a recorder/time keeper
• introduce each other
Use the information sheets provided to answer
the questions on the worksheet
You have 30 minutes
We’ll share key questions with the DECC/EA
panel afterwards.
They will also be circulating among you to clarify
issues

James Tiernan
UNITE Students Business case study:
UNITE Group PLC

James Tiernan
Group Energy & Environment Manager
Unite Students’ Energy Management
Journey

• Part of The UNITE Group plc, formerly , now
• A Bristol born & based company
• UK’s biggest student accommodation provider
• Purpose is to create a Home for Success for our students & staff
• FTSE250 listed, over 1,000 employees,
• ~44,000 students bedrooms across 130 properties (wholly owned
and fund/JV owned) in 23 UK towns & cities,
• High quality, fully serviced, safe & secure accommodation
• All inclusive rent – no energy surcharge, cap or deposit
• Direct students lets, & partnerships with over 50 University
• Various building types & services strategies
• Obligation to encourage sustainable living
• Numerous drivers to reduce energy (mandatory reporting,
voluntary disclosures, stakeholder expectations, rising costs)
40
Who are Unite Students?

Utilities & Carbon Headlines
41
£0
£5
£10
£15
Elec Water Gas
Millions
Annual utilities spend
(£m’s)
Scope Use Tonnes CO2e
1
Accommodation:
gas
5,209.7
HQ Office: gas 75.6
Company car use
on work business
76.5
2
Residential: elec 50,314.5
HQ Office: elec 38.1
• Multiple drivers to cut energy & carbon
• Highly distributed consumption
• Majority of consumption under customer control
• Challenging customer engagement

Typical accommodation
42
“Cluster flat”
Shared lounge/
kitchen
En-suite
bedroom
“Studio
flat”

Unite Students’ Energy Strategy
43
• Procure good value utilities
• Pay the right amount
EFFECTIVE
PROCUREMENT
• Understand demand &
consumption
• Reduce demand
BE LEAN
• Meet demand efficiently
• Minimise wastageBE CLEAN
• Reporting, verification &
certification
• Reduce Scope 3 emissions
• Renewables opportunities
BE GREEN
STRATEGICOBJECTIVES:
Bill checking,
validation &
meter estate
Customer &
staff
behaviour
Optimise &
improve
hardware
Expand
environmental
/ sustainability
agenda
ACTIONS:AIM: Control & reduce energy consumption

Building types & energy usage
45
DOMESTIC HOT
WATER
SPACE HEATING No. of
sites
Average £/bed/yr
Elec Gas Total
Local electric
immersion
Local electric 85 sites £350 £0 £350
Central gas boilers Central gas boilers 13 sites £278 £96 £374
Central gas
calorifiers
Local electric 11 sites £283 £119 £402
Local gas combi-
boilers
Local gas combi-
boilers
6 sites £171 £219 £391
Central gas CHP &
gas boilers
Central gas CHP & gas
boilers
3 sites £214 £126 £340
Off site district
heating & on site
back up gas boilers
Off site district heating
& on site back up gas
boilers
2 sites £331 £0 £331

Benchmarking
46
“All electric”
District heating
Gas
CHP
Central gas
boilers
Gas DHW,
elec. heat
Local
combi-
boilers
Electricity consumption per bed per year

Benchmarking
47
Focus on “all electric sites” as biggest opportunity
Variation
Opportunity
Electricity consumption per bed per year

Landlord demise
Tenant demise (“behind the flat door”)
Challenges:
No standard or typical student living or occupancy patterns
Mostly small, distributed, student controlled loads; few large, central loads
Variety of building services, fabric, age, condition and location
Building Level Energy Usage
48
27%-46% of site’s total electricity
54%-73% of site’s total electricity
20%-35%
20%-25%
20%-35%
15%-30%

• Rolling out major LED lighting & controls upgrade over 2014-16
• 3 full site trial installations achieved ~20% energy savings
• Expecting ~15% energy savings across whole estate
• 30% reduction in maintenance jobs
• Significant improvement to internal lighting levels & quality
Progress made: LED Lighting
50

• Optimise settings for existing “Prefect” controllers, trialling across
4 sites, ~20% savings
• Piloting retrofit smart local & web-controlled heating & hot water
controls including presence detection
• Reduced kWh consumption
• Improved customer comfort & satisfaction
• Peak demand shedding: Triad & red DUOS avoidance
Progress made: Heating & DHW Controls
51

Progress made: Student & Staff Behavioural Change
• Looked at numerous different student engagement approaches
(“Carrot”, “Stick” and competition)
• Trialled various off-the shelf programmes
• Recruited in house expertise and have developed and
launched major customer & staff engagement initiative
52
• Called “Up to uS”
• Bespoke programme to encourage responsible
living habits
• Focus on reducing energy & water use,
increasing recycling, and general sustainable
living, incudes NUS “Green Impact” scheme
• Includes national, local and individual levels to
drive behavioural change
• Very difficult to quantify savings, but expect 5%
- 10% reduction

• 3rd party verification of energy & carbon data reported
• Rolling out hot-water saving measures
• About to install 1,000 energy & water saving shower heads,
specially selected to balance customer expectations over
energy/water savings, while also preventing lime-scale and
biofilm
• Developing ISO14001 ready EMS
• Planning for ISO50001 based EnMS
• Use Sustainability Champions in buildings to identify local
opportunities
Coming soon…
53

Lessons learned
• Structured approach vital to keep on track
• Understand & prioritise opportunities & solutions yourself
• Make targeted use of external support to achieve specific aims
• Customer satisfaction is critical
• Support & buy-in from senior management & building
operations teams is key
• “A good plan today is better than an excellent plan tomorrow”:
Need to be flexible & ultimately actions are what count
54

• Definitely an opportunity
• Undertake data collection & survey that would be difficult to
justify otherwise
• Combining ESOS & compliance with the Minimum Energy
Efficiency Standards (MEES) for EPCs to minimise costs
• Collect accurate & useful data to inform future energy strategy
• Capture data in an accessible & usable format
• Target the “outliers” with most significant potential savings
• Drive towards ISO50001 for subsequent phases
Our take on ESOS
55

Thank you
Any Questions?
James Tiernan BSc MSc IEng MIE ACIBSE
Group Energy & Environment Manager
Unite Students
james.tiernan@unite-students.com
0117 302 7115
56

Miles Alexander
Green Investment Bank Financing for Energy
Efficiency

Financing for Energy Efficiency
Miles Alexander
Head of Commercial & Industrial Energy Efficiency
UK Green Investment Bank plc

59
AGENDA
1. GIB Introduction
2. Energy Efficiency
3. Financing for Energy Efficiency
4. Case Studies
5. Conclusions
6. Questions and Answers

61
£3.8bn
Capital to invest
in green projects
WHO WE ARE
70Specialist investors
and technical experts
Chaired by Lord Smith
Independent Board
100%
Owned by the
UK Government
Mobilise
private sector
investment
Accelerate the
UK’s transition to
a green economy

62
OUR JOB
Our vision: green and profitable Our task: crowding-in capital
Our markets:
Offshore
Wind
Waste &
Bioenergy
Energy Efficiency

63
We have invested in every
part of the UK, in all of our
sectors and using all our
financial products
WE ARE INVESTING
Our investments will save 1.3
million tonnes of waste from
landfill
We have backed 6 local
authority, 3 commercial and 4
anaerobic digestion waste
projects
We have backed large and
small projects; from a
CapEx of £2m
to £1bn
We are building a market in
energy efficiency, including
streetlight conversion and 4
NHS projects
Our investments will produce
enough renewable electricity
to meet energy needs of 2.9
million homes
We’ve invested £623m
in 5 offshore wind
projects, including
construction equity
We have set up 5 funds,
with £250m, to back
small projects
Our investments will cut CO2
emissions equivalent to
taking 1.5 million
cars off the road
We have committed £1.4bn of capital to 35 projects, mobilising a total of £4.9bn

65
ENERGY EFFICIENCY OPPORTUNITY
THE ENERGY
EFFICIENCY
OPPORTUNITY
Cost Savings
SustainabilityUK Plc
UK businesses can reduce
their energy bills by 15%, or
£1.6bn per annum
Socially cost-effective
investments can save
196TWh in 2020,
equivalent to 22
power stations
£17.6bn UK sales in 2011
– forecast to grow 5% pa
Currently accounts for
136,000 UK jobs;
potential to create
>300,000 new jobs
Sources: CBI: Shining a Light; Energy Efficiency Deployment Office; Lavery/Pennell; Westminster Sustainable Business Forum

66
ENERGY EFFICIENCY DRIVERS
Source: McKinsey, Lavery Pennel, ECUK,DECC – Energy Efficiency Strategy, GIB
Drivers
Energy Efficiency is underpinned by strong and sustainable drivers
Industrial
Competitiveness
Sustainability
• UK energy efficiency target of 20% reduction by 2020
• Increasing energy prices & volatility
• Technology improvement leading to significant cost reductions & improved payback profiles
• Companies can see cost reductions versus competitors due to reduced energy usage
• Differentiating brands through focus and proven delivery of sustainability
Regulation
Energy Prices
Technology
Development

67
GIB EE TECHNOLOGY CLUSTERS
ONSITE GENERATIONBUILDING
RETROFIT
INDUSTRIAL
PROCESSES
̶ BMS/ Voltage
optimisation
̶ HVACs
̶ WallInsulation
̶ Replacement
glazing
̶ Boiler/Chiller
Upgrade
̶ Indoor & other
lighting
̶ Municipalities
̶ Hospitals
̶ Hotels
̶ Universities
̶ Offices
̶ Ground
Source Heat
Pumps
̶ Air Source
Heat Pumps
̶ Biomass
boilers
̶ Municipalities
̶ Hospitals
̶ Retailers
̶ Supermarkets
̶ Universities
̶ Leisure
̶ CHP
̶ Mini-CHP
̶ Hospitals
̶ Hotels
̶ Universities
̶ Offices
̶ Street
Lighting
̶ Other
Outdoor
Lighting
̶ Lighting
Controls
̶ Hospitals
̶ Municipalities
̶ Retailers
̶ Airports &
Stations
̶ Car parks
̶ Furnace
insulation &
upgrade
̶ Process
control/opt.
̶ Reactor
upgrade
̶ Variable Speed
Drives
̶ Motors
̶ Pumps
̶ Waste heat
recovery
̶ Power mgt syst.
̶ Chemicals
̶ Food &
Beverage
̶ Mineral
Products
̶ Paper &
Publishing
̶ Comms
networks
̶ Smart meters
̶ Data
management
̶ Grid storage
̶ District
Heating
̶ Utilities
̶ Telecoms
̶ Meter Asset
Providers
̶ Communicati
on Hub Asset
Providers
GIB focuses on seven energy efficiency technology clusters
INFRASTRUCTURE
̶ Transport
infrastructure
̶ Hybrid/
Electric
vehicles
̶ Charging
infrastructure
̶ Rolling stock
̶ Municipalities
̶ Retailers
̶ Logistics
̶ Transport
service
providers
Renewable
Heat
EXAMPLES
EXAMPLE
CUSTOMERS
CHP
Efficient
Transport
Smart Grid
Outdoor
Lighting

68
Financing for Energy Efficiency3

69
GREEN FINANCING OPTIONS
Number of financing methods for sustainable projects
Company
cash flow
Corporate
(green) loans
Green bonds
Off balance
sheet
financing
Energy
Service
Companies
Purchase
power
agreements
• Use existing company
cash resources
• Often used but tends to
lack long-term
sustainability strategy
• Bank cash flow loans,
asset financing,
mortgages
• New funding for green
projects eg Sainsbury’s
Green Loan
• Expanded from utility
green bonds to wider
branding including
consumer focused
companies (eg
Unilever)
• Special Purpose
Vehicle established to
reduce risk to company
but at a higher cost
• Difficult to establish for
embedded technology
• ESCO takes on
implementation risk and
guarantees savings
• Ability to also provide
bank financing
• Ability to buy-in green
power but only off-
setting carbon
reduction rather than
self-reducing CO2

70
GIB FINANCING OPTIONS
GIB can finance a wide array of green projects with flexible capital
GIB Funding
 £3.8 billion of UK Government funding
 GIB funding is on commercial terms
 Focus on opportunities with £10m+ of
funding requirement (can be across
multiple projects)
 GIB can invest much longer than other
banks (25+ years)
 Can invest across the capital structure,
providing equity or debt or a hybrid, with
low or no equity from host company
 GIB has the ability to sculpt return
profile so that savings pay for the
investment
 Independent investment committee
 Focused mandate allows for efficient
investment process
 Supportive senior management
Benefits of working with GIB
 GIB brings green and finance credentials,
as well as government backing with long-
term perspective
 GIB can engage early in a project to
develop the opportunity, leveraging know-
how and contacts
 Flexibility for host to have operational
involvement or be at arms length
 GIB is willing to work through difficult
situations to support project execution
 GIB has strong financial, industrial and
technical skillset and wide contact base
 Focused mandate allows for an efficient
investment process

71
GIB BACKED EE INVESTORS
• Non-domestic energy
efficiency within the
NHS
• Expected average
project size of £5m
• Energy efficiency
saving measures which
offer an annualised
reduction in GHG
emissions during the
lifetime of the financing
• Includes biomass,
CHP, medical waste
incineration, lighting,
VSDs, heat recovery
• £2.2m investment to
fund installation of a
CHP unit at
Cheltenham General
Hospital
Focus
Investment
criteria
Technologies
• Non domestic energy
efficiency
• £500k to £30m of
required capital
saving measures
which offer an
annualised reduction
in GHG emissions
during the lifetime of
the financing
• Building retrofit,
infrastructure
improvements, district
heating, renewable
energy, industrial
energy efficiency
• £0.4m equity
investment to fund
retrofit of a Kingspan
warehouse. Revenues
are based on a share
of energy cost savings
• Asset financing
• GIB-DLL Syndication
Alliance focus on NHS
• Asset financing of all
equipment sizes
• GIB-DLL Syndication
Alliance minimum of
£1m and maximum of
£25m loan value
• Energy efficiency saving
measures which offer an
annualised reduction in
GHG emissions during
the lifetime of the
financing
• Includes CHP, lighting,
building management
systems, VSDs
fund CHP upgrade,
boiler upgrade, LED and
building management
systems at Queen’s
Medical Centre
• Non domestic energy
efficiency
• £500k to £30m of
required capital
saving measures
which offer an
annualised reduction
in GHG emissions
during the lifetime of
the financing
• Biomass to heat,
CHP, district heat,
building retrofit, EPC,
smart metering
fund the installation of
a biomass boiler at
Tomatin Distillery near
Inverness
Project Size
Financing
example
• Asset financing
• Public and private sector
• Asset financing of all
equipment sizes
• GIB-SGEF Syndication
Alliance minimum of £2m
and maximum of £20m
loan value
• Energy efficiency saving
measures which offer an
annualised reduction in
GHG emissions during
the lifetime of the
financing
• Includes CHP, boilers,
building retrofits, lighting,
and energy reduction
technologies for
production processes
• £5m investment to fund
the installation of a CHP
unit, dual fuel boilers,
biomass boilers and
effluent treatment at
Rampton Hospital

72
OTHER ENERGY EFFICIENCY FINANCIERS
efficiency within SMEs,
aiming at turnover >
£25m
• £200m Carbon Reduction
Fund through
government’s funding for
lending scheme
• Through RBS’s
partnership with Mentor,
businesses are offered
energy efficiency audits
(£1,000 cost)
• RBS offers financing to
cover audit
recommendations, with
1% reduction on standard
rate of interest and covers
the costs of any
associated fees, including
cost of the initial audit
Focus
efficiency equipment with
project size > £1,000
• Independent carbon
saving assessment is
undertaken by Carbon
Trust Implementation
Services, with financing
provided by Siemens
Financial Services
• Financing can be
arranged directly by the
customer or through the
scheme’s recognised
suppliers
• Suppliers are able to
apply to become
recognised, enabling
them to combine
financing with product
sales
• Financing payments are
offset by anticipated
energy savings
Financing
• SME lending
• Corporate ‘green’ loans
• Lloyds financed with
Rabobank the first ever
corporate ‘green’ loan
(£200m loan to
Sainsbury’s)
• Structure is consistent
with Green Bond
Principles 2014
• Loan accredited as green
and independently
monitored by
Sustainalytics
• Eligible projects include
renewable energy, energy
efficiency, water use
management and carbon
reduction
• Business loans across the
SME to corporate
spectrum
• Many other providers of
capital including high
street banks which will be
familiar with different
lending options and can
provide face-to-face
contact for businesses
• Corporate/commercial
divisions provide
dedicated relationship
directors to give advice
• Lending to fund energy
efficiency projects
supported by a sound
business case could be of
interest to these and other
lenders
• Energy audits should help
support SMEs in building
their business case

74
CASE STUDY: KINGSPAN WAREHOUSE RETROFIT
Finance
• It is structured as a fully equity funded energy services
agreement, requiring no capital investment from Kingspan
• Revenues are based on a share of measured and verified
energy cost savings
• The Pari Passu co–investor
• Mobilisation 1:1
Summary
• The UK Energy Efficiency Investments Fund ‘UKEEI’,
which is cornerstoned by GIB, has committed to a
£0.4m equity investment to fund the retrofit of a
Kingspan warehouse in Wales.
• The investment provides 100% of the funding
required to retrofit its Holywell insulated panel
manufacturing facility factory to reduce energy
demand and creates cost savings through lighting,
compressed air and extraction fans, metering and
motor replacement.

75
CASE STUDY: TOMATIN DISTILLERY BIOMASS BOILER
Finance
• It is fully equity funded, with shares and a subordinated loan
note agreement
• Revenues will be generated by the sale of heat, lease payments
and the receipt of RHI
• The Pari Passu Co-investor is a parallel Fund raised by Equitix
• Mobilisation 1:1
Summary
• The Energy Saving Investment Fund ‘ESI’, which is
cornerstoned by GIB, has made an investment of
£0.6m for the financing of the installation of a biomass
boiler at Tomatin Distillery near Inverness
• The boiler installation produces heat for the steam
utilised in the production of whisky. The boiler
replaces a high maintenance, inefficient oil fired
boiler. The new boiler will replace 80% of the heat
load usually generated by the oil fired boiler.

76
CASE STUDY: GIB GREEN LOAN
 Assistance in business case development including up to
£0.5m Starter Loan to fund costs
 Green Loan funding covers LEDs, CMS, column renewal
and other project costs
 Fixed rate funding with interest paid only on amounts
drawn
 Repayment profile can be sculpted to forecast energy
efficiency savings (see below):
 Potential to blend with other sources of finance
 Certainty of programme funding or the Authority
 Confidence for new EE ‘spend to save’ programme
 GIB technical, legal and financial due diligence and on-
going green monitoring
 Compatible with variations to PFI projects without the
need to alter existing funding in the PFI SPV

78
CONCLUSIONS
• Energy efficiency projects are a means to making your business more robust
• Saves energy … which saves money
• Saves resources … which can be better used to grow your business
• Saves carbon emissions … which enhances your position with your stakeholders
• Energy efficiency can be funded from many sources
• Your own cash which will be paid back with upside returns from the savings
• Your bank or third party funding
• Government incentives
• Energy efficiency needs companies to prioritise it
• Dedicate resources to identify, build the business case and implement the EE projects
• Reward employees to drive the energy efficiency projects
• Energy savings will be a source of future capital and dividends
Financing should not be a barrier to grabbing your energy efficiency opportunity

80
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confidential basis solely for information purposes only. No reliance can be placed on this Document by any recipient or any other person. This Document and its contents are confidential to
the person to whom it is delivered and must not be reproduced or distributed, either in whole or in part, nor its contents disclosed by such persons to any other person without the prior
written consent of UK Green Investment Bank plc. Except as required by law, neither UK Green Investment Bank Plc nor any of its connected persons accepts any liability or responsibility
for the accuracy or completeness of, or makes any representation or warranty, express or implied, with respect to the information contained in this Document or on which this Document is
based or any other information or representations supplied to the recipient. UK Green Investment Bank Plc will not act and has not acted as your legal, tax, accounting or investment
adviser. This Document does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase, any investment and UK Green Investment Bank Plc does
not arrange investments for/introduce parties as a result of sharing the information set out in this Document.
Registered Office: Atria One, Level 7, 144 Morrison Street, Edinburgh, EH3 8EX. Company Number SC424067. UK Green Investment Bank Plc is wholly owned by HM Government. The
company is not authorised or regulated by the Prudential Regulation Authority or the Financial Conduct Authority.
Headquarters
Atria One
Level 7
144 Morrison Street
Edinburgh
EH3 8EX
Tel: +44 (0)330 123 2167
London Office
21-24 Millbank Tower
Millbank
London
SW1P 4QP
T +44 (0) 330 123 3070
CONTACT US

Andrew Garrard
Bristol 2015
Amy Robinson
Low Carbon South West
Go Green and Bristol
2015

Our journey so far
Long journey to make Bristol the UK’s greenest city, with many landmarks.
The Green Capital aspects are:
• 2003 Community Strategy:
“Bristol; a green capital in Europe – creating sustainable communities
and improving the quality of life.”
• 2007 Bristol Green Capital Partnership founded
• 2008 European Green Capital Award created
• 2013 Bristol awarded European Green Capital 2015

European Green Capital Award
Awarded to a city that:
• Has achieved high environmental standards;
• Is committed to ambitious goals for sustainable
development;
• Can act as a role model to inspire other cities.
Technical Assessment and Independent Evaluation
Stockholm
Nantes
Hamburg
Vitoria
Copenhagen

Why Did We Win?
• Many years of pioneering
environmental efforts
• Strong performance across 12
categories versus other competing
cities
• Strong community action and
effective partnerships
• Ambitious and real investment in
the future
• Exciting plans for 2015
• Sense of fun!

The Organisations
• Bristol Green Capital Partnership
– The UK’s largest city green network – over 500 organisations are members
– Democratic structure with Chair and Steering Group elected by members
– Focused on helping make Bristol a more sustainable city
• Bristol 2015 Ltd
– Independent Board including Mayor and Chair of Partnership
– Focused on securing funding, planning and orchestrating the 2015 programme
• Bristol City Council
– Key roles in supporting and contributing to 2015 programme and managing
relationships with UK Government etc
– Focused on delivering our major projects, managing Neighbourhood and
Strategic Grants and ensuring lasting impacts of year

The Organisations
• UK Government
– Both Treasury and DECC have supported the commitment of funding to Bristol
2015
– There is cross Government Department interest is supporting Bristol with Bristol
2015 as a catalyst
• Commercial Partners
– Strong private sector support through significant cash and in-kind commitments.
On-going sponsorship discussions across a number of categories
• Strategic Partners
– Important strategic and resource support
– Partners include the Universities, BusinessWest, Low Carbon Southwest, and
Destination Bristol

To become a global leader
in sustainable urban living
Local Empowerment
Empower existing
initiatives, networks and
communities to help
change attitudes and
behaviour.
Sustainability
Leadership
Exchange sustainability
expertise between
cities and contribute to
the 2015 UN climate
change negotiations.
International Profile
Build Bristol’s global
profile to support
appropriate exports,
inward investment,
tourism and economic
growth.
Bristol’s Vision
Goals for Bristol EU Green Capital 2015

Reinforce
the
necessity of
sustainable
living
Nature
Shared responsibility to create
healthy and happy cities
Food Energy Resources Transport
EducationArts & Culture
Fun New Economy
Built Environment
Health
Bristol 2015

Bristol 2015 Programme
Volunteer
Programme
Grant
Funded
Projects
Major Event
Programme
Official
EU
Events
Business
Go
Green
Visiting
cities and
businesses
Partner &
Community
Projects
Bristol
City
Council
Commissions

Local Empowerment
• Bristol 2015 Grants Scheme - £2m
– Neighbourhood Partnerships
– Small Grants Programme
– Strategic Grants Programme
• Volunteering Programme
• Bristol Welcome
• Go Green Business Engagement
• Arts Council Exceptional Award

International Profile
• Bristol Debates and International Summits
– Politics and the Environment
– Young People
– Business
– City Leaders
• Green Tech International Festival
• International Fair Trade Towns Conference
• Bristol attendance at key international events

Sustainability Leadership
• International Delegations to Bristol
• European Commission Events
• European Green Capital Network of cities
• UN Conference on Climate Change – COP 21 (Dec 2015)
• Eurocities Environment Forum
• National Schools Programme
• Bristol Method

Engaging local business
• Go Green
• Adding your own events
• Dating agency
• Maximise inclusion

Amy Robinson
Network Director, Low Carbon South
West
10th November 2014

Delivered by: Supported by:
“Supporting the Low Carbon Sector”
• Membership organisation and CIC
• sector partnership between businesses,
academia, investors, local authorities and
national agencies
• Over 3000 in the network
• Devoted to building the Low Carbon economy
in the South West

• Originally established by Forum For The Future
• Started in 2009
• A network of businesses, NGOs and public sector
organisations committed to a reducing their
carbon emissions.
• Members signed a declaration of intent and
reported on their carbon impacts
• Peer to peer learning and networking events

Why LCSW is involved with WECC

Some of our members

What has changed?

Go Green - What is it
• Collaboration between LCSW and Business West
• Programme of events and bespoke web-tool
• Open to businesses of all sizes
• Supporting businesses however ‘green’ they are
• Easy to get involved
• With a straightforward way to identify strengths
and areas for improvement

Why?
• There is a huge range of advice but it can be difficult to navigate
• One-front-door that will signpost to valuable resources and advice
• Does not reinvent the wheel – promotes existing schemes, projects and
opportunities
• Tailor-made web platform enables:
– Businesses to prioritise their activities and track and report on their
progress
– Us to collate information and report on overall progress of members
• The advice will be tailored to reflect size, location and prior progress
• Creates opportunities to learn from others and share success stories
• Provides a brand that helps businesses to demonstrates their commitment
to improve

How does it work
TRAVEL&TRANSPORT
ENERGY&EFFICIENCY
PROCURE&PREPARE
HAPPY&HEALTHY
RESOURCES&
RECYCLING
PLEDGE
ACCREDITATION + MEMBER CSR CONTRIBUTION
( prove what you are doing + help others to do the same )
SAY IT
DO IT
PROVE IT

Get Involved
Register your interest:
www.gogreenbusiness.co.uk
gogreen@lowcarbonsouthwest.co.uk

Dr Philip Douglas
DECC The UK landscape of
business energy
efficiency policies

Introduction to the
business energy efficiency
policy landscape
Dr Philip Douglas
Head, Energy Efficiency and Community Energy Strategy, DECC

Energy efficiency, decarbonisation and growth
110 Introduction to the business energy efficiency policy landscape
“The choice between going green and going for growth is a false choice. Green and
growth do go together, and the statistics back this up”
The Colour of Growth, CBI, July 2012
"...make no mistake we are in a global race and the countries that succeed in that race,
the economies in Europe that will prosper, are those that are the greenest and the most
energy efficient."
David Cameron, Energy Efficiency Mission launch, 4 Feb 2013
Energy efficiency belongs at the heart of a low-carbon economy. By reducing energy use
and cutting down on waste, we can reduce energy bills, make our energy system more
sustainable, and drive down greenhouse gas emissions.
Edward Davey, Secretary of State
“Large UK businesses are paying out more than £1.6bn too much on their energy bills
every year because many are yet to seize the full opportunity
to cut bills by around 15% through energy efficiency measures”
Carbon Trust, The Business of Energy Efficiency, October 2012

“We estimate that through socially cost-effective
investment in energy efficiency we could be saving
196TWh in 2020, equivalent to 22 power stations”

The Energy EfficiencyStrategy:a missionto realise the
UK’sEnergy Efficiencypotential
Embryonic
Markets
Misaligned
financial
incentives
Information
Under-
valuing
energy
efficiency

The policy landscape
ProductStandards
CRC
CCL &
CCAs
ESOS
EU
ETS
GHG
Reports
EDR
Green
Govt.
Salix Green
Invest.
Bank
Re:Fit
Green
Deal
Buildingregulations
EPCs
Smart
meters
DECsPublic sector
Business
Domestic
Standards
Information
Financing
Taxation / Trading Schemes
ECO
Akey challenge is ensuring that policies
complement each other… and then
effectively communicating that…
ECAs

ESOS
CRC
EU ETS & CCAs
Key business energy efficiency policies
have different primary targets
Covers all large and
smaller non-SME
enterprises
Energy intensive
industry – site based
Less energy
intensive commercial
organisations (major
energy users)

Power Plant Installation – EU ETS
All elements will be
covered by ESOS if part
of large UK enterprise
Head Office - CRC
Chemical Facility –
EU ETS & CCA
Chemical Facility
off-site offices –
CRCCar showrooms - CRC
Packaging Plant -
CCA

Policy Simplification I: Overview, CRC &
ESOS
• DECC has taken steps to simplify our policies to reduce overlap and
administrative burdens on industry
• CRC simplifications have delivered a 55% reduction in admin costs, saving
participants around £275 million up to 2030
• ESOS allows flexibility to organisations to choose their 12 month period of
energy data collection, so data gathered under existing schemes can be
used for their energy audits.

Policy Simplification II: CCAs and EUETS
• The simplified CCAs scheme removed any overlap with EU ETS as well as
simplifying overlap with the CRC Energy Efficiency Scheme
• We have simplified EU ETS through a more proportionate and consistent
penalties system and improving the independence and efficiency of the
appeals process
• A small emitters and hospitals EU ETS opt out offers 247 installations an
estimated £39million in savings between 2013 and 2020 while maintaining
environmental incentives

The current policy package is on track through to 2020 but additional
action is needed to maintain progress after 2020.
Carbon Plan scenarios require energy
efficiency to contribute a reduction in
final energy consumption per capita
between 2011 and 2050 of 21-47%

We invite your feedback
Howdowecollaborateto cost-effectivelyachievemoreenergy
efficiency?...Inthe policymix…
1. Whatishelpingenergy
efficiency?
2. Whatishinderingenergy
efficiency?
3. Whatismissingthatis
neededtodrive moreenergy
efficiency?

Wider landscape
table discussion
At your tables:
• agree a discussion manager/leader
• agree a recorder/time keeper
• introduce each other
Use the information sheets provided to answer
the questions on the worksheet
You have 30 minutes
We’ll share key questions with the panel
afterwards.
They will also be circulating among you to clarify
issues

DECC Energy Savings Opportunity Scheme (ESOS) South West Launch - Bristol - 10th November 2014

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DECC Energy Savings Opportunity Scheme (ESOS) South West Launch - Bristol - 10th November 2014