Practical Financing of Energy Efficiency Measures

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• Practical Financing of Energy Efficiency Measures
• Finding Internal Sources of Finance
• HEEPI Workshop Financing Energy Efficiency
• Held at University of Loughborough, 18th March
  2004
• Jamie Goth
• Energy Manager, University of Leicester

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Agenda

• Introduction why save energy?
• Finding a Budget for Energy Efficiency Measures
• Establishing a Budget
• Working with Other Peoples Budgets
• Influencing Investment Decisions
• Financial Tests
• Reviewing Success Return on Investments
• Conclusions

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Why Save Energy?

• Reduce the cost of teaching and research
• Avoid unnecessary waste
• Increase comfort conditions for staff and
  students
• Improve safety
• Give a sense of doing the environmentally correct
  thing
• Save natural resources
• As a co-product of the things you really want to
  do

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Will energy management conflict with my main
priorities?
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Finding a Budget for MeasuresEstablishing an
Energy Efficiency Budget
Senior Management Commitment
Budget Type (central or devolved)
Energy Policy Statement
Cumulative (keep savings)
Fixed Sum (e.g. 0.1M p.a.)
Proportional (e.g. 5 p.a.)
No Budget (when funds allow)
Financial Criteria
Whole Life Cost (least negative)
Environmental
Payback Period (e.g. 4 years)
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Finding a Budget for MeasuresUsing an Energy
Efficiency Budget

• Urinal controls
• Lighting controls
• Fridge motor controllers
• Variable speed drives
• Pipework insulation

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Finding a Budget for Measures Using an Energy
Efficiency Budget to Meet Others Needs

• Thermal Comfort
• Draught-proofing
• Loft insulation
• Thermostatic radiator valves
• Maint.- control longevity
• Variable speed drives
• Urns in place of kettles
• Timeswitches for urns
• Security
• PIRs for external lighting

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Finding a Budget for MeasuresUsing Other
Peoples Budgets Departmental Equipment

• Plant growth cabinet modifications
• Control of cooling water flow for air compressor
• New equipment specifications
• air compressor
• fridge freezer cabinets
• Chilled-water cooled ULT freezers

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Finding a Budget for MeasuresUsing Other
Peoples Budgets Maintenance Budget

• Replacement lamps
• Replacement light fittings
• High efficiency motors
• Heating controls upgrades
• Cold room replacements
• Legionellae control
• insulate cylinder pipework

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Finding a Budget for MeasuresUsing Other
Peoples Budgets New Build Refurb.

• Get in before the budgets set
• Include energy efficiency costs in budget
• Ensure Part L compliance
• Justify overcost to typical installations with
  WLC
• Examples of New Build/ Refurb. Projects -
• Building Management Systems
• Generous heating zone control
• Chilled water / VRF instead of DX
• Heat Recovery
• High levels of insulation

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Finding a Budget for MeasuresInfluencing
Investment Decisions

• Energy Codes of Practice for Refurb.
• Campus-Wide Strategies for
• Heating
• Cooling
• Controls
• Procurement Policies
• Equipment Standardisation
• Quality System
• Transport energy use
• Academic Interest

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Finding a Budget for MeasuresInfluencing
Investment Decisions

• Renewable Energy Strategies
• Physical installations
• Lease and investment
• Green electricity tariffs
• Policies in new developments

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Financial Testsfor Energy Efficiency Measures
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Financial TestsSimple Payback Period
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Whole life costing

• Aim
• To identify the right quality option with lowest
  cost to whole institution over lifetime of
  purchased item
• Must be -
• Transparent
• Predetermined
• Legal fair
• NOT
• Lifecycle Costing
• Environmental Footprint
• New or radical
• Optional

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Investment ReviewFunctional Suitability and
Return on Investment

• Functional Suitability
• Does it do the job that was asked for?
• Was it done on time?
• Was it the right job to ask for?
• Investment Review
• Was it completed within budget?
• Were the estimated savings made?

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Conclusions

• Achieve energy savings through other peoples
  investments
• Meet other peoples needs through investments in
  energy efficiency
• Saving energy is just one of the many outputs of
  well run projects