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Saving Bromley Schools Money through Energy Efficiency
5 December 201316.30-18.00hrs
LB BromleyRE:FIT Schools ProgrammeSalix Schools Programme
Welcome to this BSSF twilight event
We are all facing increasing cost pressures
Schools need to be spending their budgets on educational outcomes…
… but increasing amounts are being unnecessarily wasted on energy bills
Tonight’s all about helping you to reduce your energy consumption and costs
Welcome
Schools account for about half of LBB’s carbon footprint, so naturally we want to help you save energy
All schools are different but you can all take action to reduce energy consumption
Officers have produced a circular (067/13) and tonight is about bringing that circular to life
We’ve reviewed the various procurement and finance options and identified two particularly useful schemes
I am particularly pleased to welcome RE:FIT and Salix to our meeting, and you’ll be hearing from them later
Welcome
What’s the problem?
What’s the solution?
Procurement Options
RE:FIT Schools Energy Efficiency Programme
Finance Options
Salix Finance
Q & A Session
Tonight’s Agenda
Legacy issues (neglected heating, lighting, buildings)
Energy prices are increasing faster than inflation
More electrical equipment (e.g. for ICT) being used
School rolls increasing
Extended hours
Limited capital and expertise for energy efficiency initiatives
… and it’s going to get worse!
But we have a plan
What’s the Problem?
Heating & cooling
Building fabric
Lighting
Voltage supply
Catering equipment
Electrical equipment (e.g. IT)
Energy management
Energy Savings Opportunities
Case Study 1: Lighting Upgrade
Lighting up The London Oratory School
The ChallengeLarge 1970’s built school
Energy intensive old lighting system
Lighting alone costing £24k per year
Electricity demand outweighing supply – possible new sub-station required
Lights on in unoccupied spaces
Lights used even when good levels of daylight available
Looking for ways to reduce energy consumption
Lighting up The London Oratory School
The solutionLighting system upgraded with LEDs
Movement sensors installed
Daylight sensors installed
Lighting up The London Oratory School
Key BenefitsEnergy savings: 77%
New annual electricity costs (lights): £5,467 (from £24k)
Payback period: 3.2 years
Intelligent controls to maximise energy savings; lights on as and when needed, supplements natural daylight
High quality light uniformity and colour; no flicker
Enhanced educational environment
Carbon savings: ~80 tCO2
Maintenance free for 8-10 years
Typical 5 year warranty
What does one tonne of carbon dioxide looks like?
Case Study 2: Lighting Upgrade
The ChallengeSport hall requires an average 300 lux light level (CIBSE lighting guidelines)
16 energy intensive (400W) SON lamps were being used
Hall used for after school activities and a training centre for the County Cricket Club
Lighting up Marston Vale Middle School’s Sports Hall
The SolutionLighting system upgraded with LED High Bay lights
Cost: ~£7,000
Key BenefitsOver £5,000 saved on electricity p.a.
Payback: 1.4 years
5 year warranty
Carbon reduction: 30 tonnes p.a.
Lighting levels improved
Lighting up Marston Vale Middle School’s Sports Hall
Case Study 3: Voltage Optimisation
Reducing electricity consumption at Treorchy Comprehensive school
The ChallengeLarge comprehensive school
Looking to reduce energy costs and reduce carbon emissions
In the UK, electricity is supplied at a higher voltage than required, resulting in:
• Surplus energy consumed• Higher electricity costs• Places strain on equipment
Reducing electricity consumption at Treorchy Comprehensive school
Your schoolcould bepaying forthis level of voltage!
The SolutionA PowerPerfector Voltage Optimisation unit installed
Voltage stabilised at 220v
Key BenefitsEnergy savings: 16.1%
Financial savings: £12,000
Carbon reduction: 51 tonnes
Prolongs the life and reliability of all equipment
Guaranteed savings/return on investment
Payback period: average 3-5 years
Reducing electricity consumption at Treorchy Comprehensive school
Case Study 4: Draught proofing
The ChallengeStaff and pupils experienced ‘draughty’ windows
Double glazing was not economically viable at the time
£19,903 annual gas bill
Quattro Seal Draught ProofingCastle Hill Primary, Croydon
The solutionQuattro Seal permanent draught proofing
Cost: £8,468
Key Benefits£3,021 (15%) saved on gas bill each year
Payback: 2.8 years
Carbon reduction: 22 tonnes p.a.
Warmer learning environment
Quattro Seal can be used for listed buildings as it is a fully reversible system and is applied internally
All the benefits of double glazing but at a fraction of the cost
Quattro Seal Draught ProofingCastle Hill Primary, Croydon
Your Procurement Options
Self-manage (contract directly with supplier)
EnergyPerformanceContracting
IndependentEnergyServices
?
RE:FIT Schools Energy Efficiency
Programme
Minimise costs; no middleman
Energy saving opportunities identified by school
Indicative savings v Guaranteed savings
Limited in-house expertise; missed opportunities
Burden on resources and time
Self-manage
Specialist energy solutions provider (e.g. Mears)
Complete energy performance solution
Guaranteed savings negotiable
Associated service cost ~ 10% (+)
Independent Energy Service Company
Utilises an Energy Service Company (ESCo)
Complete energy performance solution
Transfer risk of performance to the ESCo
Associated cost ~ 10% (+)
Energy Performance Contracting
RE:FIT Schools Energy Efficiency Programme
ROBERT MCKINNON
Marketing & Engagement Team Lead RE:FIT
[email protected] 759 8515
London’s building retrofit programme
RE:FIT – energy efficiency investment in Bromley’s schools5 December 2013
"Putting our energy into reducing yours"
The Mayor’s CommitmentLondon Mayor’s Climate Change Target
Today 2020 2025 2050
• Reduction in greenhouse gas emissions by 60%below 1990 levels by 2025
UK Climate Change Act (2008)
• Reduction in greenhouse gas emissions by 80%below 1990 levels by 2050
European 20‐20‐20 Target
• Reduction in greenhouse gas emissions by 20% below 1990 levels by 2020
• 20% increase in renewables • 20% cut in energy consumption
The Mayor’s commitment
42% of London’s CO2 emissions are from workplaces
CO2 emissions from London, 2008(excluding aviation)100% = 44.7 million tonnes CO2
Commercial & Public Sector CO2 emissions from London, 2008100% = 19.2 million tonnes CO2
Workplaces42%
Homes36%
Transport22%
Heating46%
Lighting19%
Catering11%
IT 3%
Cooling5%
Hot water9%
Other7%
Public sector comprises health (23%), education (47%) and offices (30%)
RE:FIT framework procurement
OJEU compliant framework established
Benefits for public sector clients:
• Provides ready‐for‐use, pre‐negotiated, EU compliant contracts
• No sharing of energy cost savings
• Opportunity to make significant energy and carbon savings
• Energy savings are guaranteed
• Low payback periods suitable for schools
• Uses experience to develop best practice templates/ standards
RE:FIT allows public bodies to make substantial cost savings, reduce energy bills and the carbon footprint of their buildings
The RE:FIT Building Energy Efficiency Programme
Then run a competitive mini‐competition to select an Energy Service Company (ESCO) to carry out the works and guarantee the resulting energy savings
This guarantees the payback of the investment with the delivery risk transferred to the ESCo
Energy Performance Contracting approach: The public sector building owner identifies a portfolio of buildings to retrofit, sets a target percentage energy savings and a payback period
Insulation
Enhanced building management system
Improved cooling equipment
Low carbon heatingNew lighting system
Pipe lagging and draft proofing measures
Voltage optimisation
Renewable energy generation
Efficient pumps / drives
Additional benefits of RE:FIT Programme
RE:FIT Schools provides guaranteed energy / water savings and other potential benefits:
Reduction in maintenance backlog and costsNew equipment (failing systems can be prioritised)Improved systems provide better building knowledge and early issue awarenessImproved and safer environment for pupils and staff
• Lighting & controls• Variable Speed Drives on pumps & fans• PC control• Building Management System controls• Insulation to pipework• Voltage optimisation• Draught proofing• Radiator reflector panels• Cavity wall insulation• Loft insulation• Heat recovery• Solar thermal• Combined Heat & Power• Photovoltaic panels• Secondary glazing/ double glazing
1E Nightwatchman software for PC auto shutdown
Energy Conservation Measures include:
RE:FIT achievements
• Universities• Hospitals• Cultural centres• Colleges
Retrofitting completed/near completion, 235 buildings
• Schools• Fire stations• Police buildings• Leisure centres
93 London organisations are engaged with RE:FIT:
• 28 London Boroughs • 21 NHS organisations• 39 Education/Government/Heritage organisations
• Civic centres• Office buildings• Community buildings• Libraries
A pipeline of 600 public sector buildings, c.£66.7m of investment
The Programme Delivery Unit
• Managing the RE:FIT framework of suppliers since 2011
• Facilitates the uptake by London‐based public sector organisations
• Supports clients through all programme stages (over 70 projects and growing)
• Uses experience and lessons learnt to develop best practice templates and standards
• £2,671,000 funding, 90% from ELENA (European Local Energy Assistance Programme), 10% from the GLA
• Provided at no cost to London’s public sector organisations
RE:FIT School’s Programme
• Targeting 200 London Schools over three yearsPrimary, Secondary, Six Form Colleges & organisations running groups of schools
• Developed with GLA, DfE, DECC and Salix£ 3 million funding commitment per year to support London’s schoolsVia interest free loans from SalixUp to 8 years repayment periodIncludes Grant Maintained and Academy Schools
• So far over 70 London schools and most London boroughs have shown interest
RE:FIT School’s Programme
• Slightly different process to the standard the RE:FIT framework
Schools can apply directly, via Councils or via other 3rdParties
Opt in agreement required from each school
Processes stream lined, phased approach
Pre‐selected Energy Service Company
Energy savings indicative per school and guaranteed per each phase
The RE:FIT School Processes
• Senior management and Governor buy‐in
• Opt agreement signed
• Data gathered on school buildings
• Initial Benchmarking
• Energy savings potential identified
• Agreement to proceed ( Call off contract phase 1)
• Investment Grade Proposal (IGP)
• Call off Contract Phase 2
• Building contract signed/ Funding agreed
• Verify savings for duration of the overall project
Opt in agreement
Benchmarking and initial ECM
survey
Investment Grade Proposal
& Implementation
Measurement & Verification
Benefits of RE:FIT
RE:FIT is a public sector initiative for the public sector.
There are no royalty or other costs associated with accessing the RE:FIT Framework, or receiving the energy savings benefits it will bring you.
London’s building retrofit programme
Examples of RE:FIT Schools projects
"Putting our energy into reducing yours"
Case studies: ODA Schools
Ealing Council
Harrow Council
Project: Retrofit 12 primary and secondary schools
Savings 35% reduction in energy costs
31% reduction of CO2 emissions
Value £550,000 capital investment
Average 4 year payback period
Timescale 11 month project, completed September 2012
ODA Schools
The ODA Schools RE:FIT project encompassed 12 schools in the following London Boroughs:
Hackney, Newham, Tower Hamlets & Waltham Forest
The progression of this programme was rapid:
Mini‐competition was completed in February 2012, EDF Energy appointed as the supplier.
Installation works commenced during the school holidays in July 2012 and were completed in September 2012.
A selection of Energy Conservation Measures were installed across these schools: ‐ Lighting upgrades / Lighting controls ‐ Computer power management ‐ Space heating controls ‐ Server room optimisation
Benefiting from over £130k in fuel bill savings pa
Case studies: Harrow Council
Ealing Council
Harrow Council
Project: Retrofit 6 first and middle schools
Savings 29% guaranteed cost savings per annum
345 tonnes of CO2
per annum to be saved
Value Over £586k capital investment
10 year payback period
Timescale Installation completed December 2012
Harrow Council
Harrow Council are now on their third phase of RE:FIT projects and their first phased encompassed 6 schools
Belmont , Cannon Lane, Glebe First, Pinnerwood, Stanburn First and Middle Schools and Norbury School
Following the mini‐competition , MITIE was appointed in February 2012 and worked closely with each school to ensure the works did not disrupt the activities and timetables. Scheduling works in school holidays and completed December 2012.
A selection of Energy Conservation Measures were installed across these schools: ‐ Boiler replacement ‐Lighting upgrades and controls ‐Heating controls optimisation ‐Voltage optimisation ‐Roof insulation / Loft insulation ‐Draft proofing
Norbury School’s Head teacher Deb Spruce said the school’s energy use has dropped significantly since the changes with new boilers fitted, lighting upgraded and a new temperature control system installed.
Colville (RBKC)
RE:FIT School’s Programme
Investment Level Ranging from
• Primary School: £30k to £70k • Secondary School: £75 to £250k
Savings and payback period
• The savings will vary between 10 and 30% on average
• Typical payback periods of 6 to 8 years.
Year 1 Year 2 Year 3 Year 4 Year 5Initial Funding
Year 6
Salix Loan
Net Saving
Repay loan
Repay loan
Repay loan
Repay loan
Repay loan
Net Saving Net Saving Net Saving Net SavingYear 7
Net SavingRepay loan
Salix Loan Example
The below graphic shows how the savings are achievedover a 7 year period
Robert McKinnon Turner & Townsend020 7759 [email protected]
www.REFIT.org.uk
Camilla Allwood Greater London Authority 020 7983 [email protected]
Schools’ Own Funds
Green DealOperating Leases
LEEF London Energy Efficiency Fund
?
Your Finance Options
EnergyEfficiencyFinancing
Salix
£100m from the European Regional Development Fund and London Green Fund: lent to public or private sector
Will work with schools, building owners, public and voluntary sector bodies, developers, ESCOs etc.
Loans are flexible and competitive; with tenors of up to 10 years and interest rates from 1.65% APR
www.leef.co.uk
London Energy Efficiency Fund (LEEF)
The school pays a rental fee for the hire of the asset (e.g. LED lighting) for a period of time
You don’t own the equipment but the kit can be changed if it becomes outmoded
Cash positive from day one; allows you to benefit from some of the savings
Bexley Business Academy used an Operating Lease (e.g. AFM) to fund the LED lighting and Biomass boilers
Operating Leases
Carbon Trust & Siemens Financial Services
Available to LA Maintained Schools (Academies require a letter from the Secretary of State)
More like a traditional finance vehicle: borrow a set amount for an agreed term
APR between 6 – 10%, term is up to 7 years
Savings must be equal or greater than the loan amount within the term
The Carbon Trust assess each applicationhttp://www.carbontrust.com/client-services/technology/implementation
‘Energy Efficiency Financing’
Energy-saving improvements can be made without having to pay all the costs in advance
It is a loan (not grant), that is paid back from the energy bill savings 6.5% average interest on the loan
Measures include: Insulation (e.g. solid/cavity wall), heating, draught-proofing, double glazing, renewable energy (e.g. solar panels)
Loan paid in instalments added to your electricity bill (agreed with provider) OR in advance (agreed with installer) www.gov.uk/green-deal-energy-saving-measures
Green Deal
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
100%INTERESTFREE
An Introductionto Salix Finance:Schools Programme
Sam IllsleySchools Programme Manager
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Who we are• Established in 2004
• Independent, publicly funded, not‐for‐profit company
• 100% interest free capital finance for the public sector
• Supporting Local Authorities, Educational Establishments and NHS Trusts throughout England, Wales and Scotland
Schools Programme
• £8 million funding from DfE
• Offering extended compliance criteria – 8 years and £200/tCO2lifetime for certain projects
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Salix funding offer
Delivering over 12,000+ projects
100%Interest freefunding
Capital finance funding programmes
Funding for alleligible public sector
organisations
Average project payback of 3.5 years
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Expression of interest and client relation support from Salix 1
2345
Application made
Application tested
Application tested by Salix
Application approved within (14 days)
Project started
Loan agreement sent
Funds transferred
Client is allocated funding from Salix and loan agreement
Salix loan submission is straightforward & quick
Salix dedicated client and technical advice and support is available throughout all stages of the Salix loan
submission
6
Client is allocated funding from Salix and loan agreement
8 Loan agreement sent
9 Funds transferred
Project completed7
Client starts project(s) (interim funding if required) The client now knows they can
Proceed with their project because funding is secure and payment guaranteed on completion
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Online Application System
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
annual tCO2
funding allocated
energy savings
projects
Schools and Academies Updates: Phase I
annual tCO2
funding allocated
energy savings
projects
Maintained Schools
Academies
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Project Types and Values
* * Multiple projects –mainly combined heating measures e.g. insulation, boiler controls, draught proofing
Multiple projects have been increasing in number recently. They will continue to increase when clients have more time to plan applications and look into a more holistic top‐bottom approach
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Salix Schools Update: Phase II
• The second phase of the new Schools Programme closed for new applications 31st October
• We received almost £8million of applications from both academies and maintained schools
• Funding still available for maintained schools that can complete their projects within this financial year
• Exemplar Schools project is now complete with 11 new case studies available as well as 4 schools taking part in a video case study
• New round of funding next year
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Salix Exemplar Schools Programme• Foundry Lane Primary School• Parrs Wood high School • Alfred Street Junior School• The Bemrose School• Glenmoor School• Thornhill School• Woodridge Primary School• Brinsworth Academy• Meon Junior School• Millbrook Junior School• Rye Hills School
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Exemplar Case Studies
SOLVING ENERGY EFFICIENCY FINANCE IN THE PUBLIC SECTORWWW.SALIXFINANCE.CO.UK
Exemplar Case Studies
Robert McKinnon (RE:FIT)
Sam Illsley (Salix Finance)
Alastair Baillie (LBB)
Lee Gullick (LBB)
Gerry Kelly (LBB)
Q&A Session
‘Thank you for attending’
RE:FIT Schools Energy Efficiency ProgrammeCall: 020 7759 8520Email: [email protected]: www.refit.org.uk/refit-schools
Salix FinanceCall: 020 3043 8800Email: [email protected]: www.salixfinance.co.uk/schools