Financing Energy Efficiency in Housings

Transcription

1 Financing Energy Efficiency in Housings Mexico City, 2017 Dr.-Ing. Rudolf Hennes H K Development Consult

2 Overview An economic paradoxon Barriers Designing a financing scheme and what it means! The example: German experience

3 Multiple benefits of EE measures Not complete (e.g. social effects (reputation) are missing)! Some benefits justify public support (in countries which can afford or which subsidize energy)! Source: IEA Capturing Multiple Benefits of Energy Efficiency

4 Barriers for EE in housing Lack of awareness Lack of information Lack of finance Lack of knowledge, expertise,.

5 Life Cycle Cost Life Cycle Cost Optimum 100 Investment & Operation 0 Economic area Cost optimum Cummulative Cost -100 Energy savings Energy Efficiency 5

6 EE gap Market LCC Markets are close to the regulatory limit and not to cost optimum! Regulatory standard Why? Focus on first cost! Cost optimum Why? Operational Cost not relevant for decision making? Behavioural economics framing Market standard Energy efficiency level

7 LCC cumm Framing the investment cost Once in a lifetime At affordability(bankable) limit First cost = Cost of investment Running cost = Cost of Living = Anyhow Cost Incremental Cost Status High transaction cost Many other desires might have sacrificed due to financial restraints Time [years] User-investor-dilemma

8 Rational for Financing Residential Homes by Public Banks Housing traditionally market for lending (construction, mortgage, ) EE leads to incremental costs Market failure justifies public support which can be effectively provided by financing Multiple benefits o o o o Saving running cost Economic (balance of trade, reduced dependency on fuel, job creation) Social (housing, health, ) Environment and climate (CO2 savings, ) Building stock: Mandatory building code to improve EE of existing dwellings politically not feasible.

9 A building standard or a Llst of single measures What does it need? Regulator Finance Institution Technical solutions Research, Industry, TA Incentives (low interest loans, grants, ) National Sources International Sources Finance Finance Institution Awareness, confidence, commitment Government, FI NGOs Design & Implementation Capacity Industry, Professionals Monitoring & Evaluation Quality Assurance Government, FI, Research Industry, Professionals

10 What might happen? Financing will help to surmount other barriers (awareness, information) Financing will create a new market for more efficient housing (suppliers, contractors, auditors, buyers) Financing will enhance building standard Financing institution might become de facto regulator in the market Multiple benefits will generate public awareness and keep the momentum high

11 one interest rate for financing Step up of bonus if efficiency target reached Promotional Incentives Step up of bonus if efficiency target reached One interest rate for financing Grant Higher energy efficiency means a higher bonus or Energy Efficient Construction Energy Efficient Retrofit 1,21 % eff 15 % 10 % 27,5% 22,5% 0,75 % eff 30,0% 25,0% 5 % 17,5% 20,0% 15,0% 17,5% 12,5% 15,0% Single measures 7,5% 10,0% 12

12 Financial volume of the German EBS program Financial volume of EBS program in mio EUR Public Budget Grants Leveraging of public funds by the financial sector KfW commitments Total construction cost Positive effect for public budget due to taxes and social security contribution (partial self financing due to backflow of funds)

13 MIO EUR Financial volume and effects of the German EBS program Zuschuss BHH mio EUR Zusage KfW mio EUR Bauvol mio EUR CO2 Red. To/a Jobs created Housing Units Economic stimulus package for small and medium sized enterprises (apply to 83% of jobs) Defining the market standard: 50 % of all new dwellings are compliant with KfW standards quality assured!

14 Development of Energy Efficiency in Buildings Development of regulatory minimum requirements of energy efficiency of new constructed houses compared to best practice an research E Primary n e r g i e Energy e f f i z Demand i e n z Solarhouses 1.WSVO Low-energy- houses 3-liter- houses 2.WSVO 3.WSVO Regulatory minimum requirements Best practice research EnEV 2002 EnEV2009 Zero-energy- houses Plus-energy- houses 15

15 How the value chain for Mexico could look like? one interest rate for financing Step up of bonus if efficiency target reached Step up of bonus if efficiency target reached One interest rate for financing Grant Energy Efficient Construction Higher energy efficiency means a higher bonus Barriers Incentives Capacities Delivery mechanism Awareness Demand Energy Efficient Retrofit or. 1,21 % eff 15 % 10 % Ecocasa PH 27,5% 22,5% 0,75 % eff 30,0% 25,0% 5 % Ecocasa Oro 17,5% 20,0% Ecocasa 15,0% 17,5% Ecocasa exist. 12,5% 15,0% Single measures EERE Single measures 7,5% 10,0% 16

16 Conclusion The energetic building standard is at present not being defined by optimum life-cycle cost. The example from Germany demonstrates that the financing can reduce the gap and might have substantial structural effects. The financing of EE in the residential sector demands new skills and capacities from the financing sector, but opens a giant potential. Mexico has made the first steps, but there is more potential.

17 Muchas Gracias!