lessons learnt & policy recommendations - leitat · lessons learnt & policy recommendations...

Lessons Learnt & Policy recommendations

FINAL DISSEMINATION EVENT,Brussels, Feb. 21st, 2017

Athanassios (Nassos) Petsopoulos

Most sports hall owners haven’t heard about theopportunities for implementing EE measuresthrough companies providing energy services (ESCO)

It is not rare that sports hall owners, both state andprivate, stress that they feel deprived in terms ofavailable funding opportunities, as they are usuallynot eligible for EU funding or do not have access tobank credits with preferential interest rates.

Bulgaria: Lessons learnt - BCC & EAP (1)

Abnormally low prices for the EE construction &assembly implementation works in Public tendering.

Investments, including ESCO, are diluted by thenecessary improvement of basic conditions andimplementation of the basic energy systems (i.e.HVAC).

Comfort levels and living conditions in sportbuildings are below average, due to the higherenergy intensity of the old building stock.


Sport building (excluding swimming pools) arecharacterized with required heating temperature of18ᵒC, which decreases the energy demand,increasing the payback period of any intervention.

The majority of the sport buildings in Bulgaria(excluding individual fitness centers) are publicallyowned. The sport club itself doesn`t generateenough funds to implement any large renovation,thus in order to implement EE measures they relyonly on third party aid.


There is still no financial mechanism in Bulgariadirectly supporting improving EE, and particularlysport buildings.

EE remains outside of the priorities of theMunicipality of Plovdiv.


Technical assistance to apply for funding: Sportowners and sport facility managers do not haveknowledge and time required to apply for fundingthrough the Spanish national energy efficiency fundsince a lot of technical documents must besubmitted, including the energy performance ratingof the sport building.

Inadequate national funding mechanisms forrenovating public sport buildings: For publicsport buildings a tender procedure is required bylaw and it’s not possible to indicate in advance thename of the companies which are going to renovatethe sport complex.

Spain: Lessons learnt – LEITAT (1)

Organization of guided visits in frontrunnerspilots: the guided visits organized in the pilot sportsfacilities that implemented energy improvementmeasures have been an effective strategy to replicatethe measures to other sport buildings

Low knowledge of public administration aboutESCO models: capital expenditure (“capex”) withinEPCs should be treated, by default, as governmentexpenditure, and as a consequence, the debt level ofpublic authorities will be increased. Projects have tobe approved by supervisory bodies.

Spain: Lessons learnt – LEITAT (2)

Not thorough investigation of financing mechanismsbefore finalizing pilots

Lack of commitment of municipalities to improveenergy efficiency through existing budgets and notas extra actions.

Provision of possibility of performing preliminaryenergy audits (not detailed energy audits) as one ofthe tasks of the project before finalizing the pilots–possible use of energy consumption data from localSEAPs (Covenant of Mayors)

Repayment of loans from banks according to energyperformance not possible

Lack of crowd funding mechanisms at local level

Hellas: Lessons learnt – SPEED SA

Portugal: Lessons learnt – JFC(1)

Decision makers of energyconsumers: With some exceptions, thesports buildings decision makers do notprioritize the energy efficiency as theyhave more concerns with investmentdirectly linked with the productionsector and they don't possess theappropriate skills to evaluate theseprojects;

Policies and Regulations:The policies are poorlyorientated and the existingregulation is poorly applied;

Equipment suppliers: Mostcompanies in this market havelack of adequate skills andtherefore there is an inherentlack of trust in them;Credit Entities: Don'tpossess the adequate lines ofcredit.


Availability of funds: The use of own capital has other priorities; Information: Lack of adequate technical communication between

clients and credit entities; Costs of development: The costs of development and engineering

may undermine other projects, especially those of low investment; Management and evaluation risks: Financial entities aren't

orientated towards the technical evaluation of these type ofprojects;

Lack of skills: Lack of appropriate knowledge and skills onvarious levels.


Energy Performance Contracts

Lack of financial interest on behalf of ESCO or private funds;

The Energy Performance Contracts costs, where applied toPublic entities, are considered as a public debt.

Loans

Low national banks funds;

Interest rate is not suitable for Public Bodies;

Inexistence of specialized credit lines for EE investments.

Own funds

Lack of own financing resources of the sport facilities;

Energy efficiency is not always a management priority;

The Public sector budget cuts within the last years have led todifficulties for sports buildings to invest in energy efficiency orrenewables measures;


National Energy Efficiency Funds

Limited and scarce available funds for EE projects;

The existing national funds have been cut or eliminatedsignificantly due the Government changes;

Financial crisis;

Some public funds are used in other strategic areas andpoor allocations of resources are available to implementenergy efficiency or renewables measures;

When the funding is approved and allocated, severalmonths can be still required until the start ofimplementation works.

Portugal: Lessons learnt – JFC (5)

National sports buildings are wasting a hugeamount of energy, especially in thermal;

Large number of national sport buildings needrefurbishment, namely the public buildings;

Legal issues and changes related with theownership of the sports buildings;

ADENE, the Portuguese Energy Agency, is stilldeveloping the nZEB definition;

Often the sport building manager is not the sameperson (or entity) who has the decision to investon the building (the sport owner). Lack ofrequired capabilities, knowledge or interestregarding the energy savings;


The Mayor and Councilors change frequently (every 4 years)and that can cause delays in the project. Due to the longduration of contracts this can also lead to change previousnegotiation decisions;

The Municipality staff initially involved may change severaltimes during the course of the project;

If the sports owner is not included since the beginning of theenergy process and the intention to perform renovations, itwill be difficult to decide positively for the investmentauthorization;

The Energy Performance Contracts are not completelyunderstood or communicated in a proper way.

Sweden: Lessons learnt – SEA (1)

Energy efficiency measures with a long depreciationtime (> 6-8 years) are rarely accepted as a realmarket and commercially acceptable measure.

Environmental and total resource argument may beappealing only to certain types of propertydevelopers, municipalities etc.

Reinvestments only in equipment that have reachedtheir technical-economic service life and the urgentmaintenance costs are very high

Sweden: Lessons learnt – SEA (2)

Sweden lacks of national and regional funds thatsupport investments in energy efficiency measures.

Mistrust in the EPC business model. The SwedishESCO market experienced a boom 10 years ago.However in 2009, the development came to anabrupt halt when the financial scheme OFFROTended. This coincided with an unsuccessful EPCprocurement process in Stockholm, causing adispute between the parties which ended up incourt.

Poland: Lessons learnt – KAPE

Administration of sport facilities does not haveknowledge about energy in buildings and energybalance,

Administration of sport facilities is not aware aboutavailable subsidies,

Without external funding it is hard to implement energyefficiency measures,

As sport facilities are mostly owned by state, unless it isabsolutely necessary, administration of facilities s arenot interested in modernization financed by loans orESCO.

The implementation and financing of energyrenovation works in sport buildings is complex andslow, even after clear renovation plans were producedand the technical assistance provided to get funding.

Current policies are insufficient to achieve thenecessary depth of deep energy renovation insport buildings, and a breakthrough is needed thatcan stimulate and foster this market,

step2sport: Conclusions

Governments need to create a framework to fosterappropriate financial mechanisms for stimulatingthe energy renovation of sport buildings.

The banking crisis has caused the requirements formortgage loans to be tightened, which prevents ownersfrom borrowing more for renovating their buildings.

Nowadays, the development of innovative financingproducts is often blocked by legislation.

step2sport: Key policy recommendations- (1)

National legislation should be adapted in MemberStates to allow more flexible financing products (e.g.financial models for EPC, national energy efficiencyfunds, etc.) favoring deep energy renovations of sportbuildings. Incentive programmes could then makepublic funding conditional on the level of energyperformance achieved.

Governments shall define new financial instrumentsin order to undertake an exemplary role in the energyretrofit of public sport building stock.


Address the EU and national accounting rules toallocate the capital expenditure in EPC. Since 2015all capital expenditure (“capex”) within EPCs should betreated, by default, as government expenditure. As aconsequence, the levels of public debt increase with theenergy renovation expenditures, being a significantbarrier for public authorities facing budgetaryconstraints. The impact of energy efficiency-relatedinvestments on the debt and deficit of governments inorder to promote Energy Performance Contracting as aninstrument to speed up the energy renovation of sportbuildings should be explored.


Awareness raising activities of sportowners/sport facility managers on energyefficiency. Governments should provideinformation to improve the awareness levels ofpublic authorities and sport owners about theimportance to renovate sport facilities with the aimto reduce the energy use but also to guaranteethermal comfort of the users. In some EU countries(e.g. Bulgaria, Hellas), energy efficiency in sportfacilities remains outside of the priorities of themunicipalities.


Use public funding to finance a facilitator role for guidingowners through the renovation process. A facilitator couldprovide guidance and personalized support to sportowners/sport facility managers to get funding to renovatetheir facilities. These advisors could also support thetendering process and provide contacts of qualified suppliersand building professionals. For a public authority the taskto prepare and implement an EPC project withoutprevious EPC experience is very challenging. The figure ofa facilitator at local/regional level can be effective to handlethe complexity of the whole retrofitting process lifecycle. Thefacilitator role could be played by the local/regionalgovernment or the private sector. The Roadmap towardsNearly Zero Energy Sport Buildings developed in theframework of STEP-2-SPORT could be an effective tool to beconsidered for facilitators.


Member States should define specific nZEB definitionsfor sports facilities since their energy usage is completelydifferent from other non-residential buildings. MemberStates should give more attention to sport buildings whendefining energy policies, and especially in the transpositionof the EPBD. Some EU Member States have only set a singlenumerical indicator for non-residential buildings withoutdifferentiating the seven non-residential building types(offices, educational buildings, hospitals, hotels andrestaurants, sports facilities, wholesale and retail tradeservices buildings, and other types of energy consumingbuildings) recommended in the Annex I of the EPBD recast.


It is recommended to include a numerical indicator of themaximum primary energy use at least for the followingtwo sport building types:

a) sports facilities with indoor swimming pools:

b) dry sports facilities (e.g. gyms, sport halls, …)

Since the energy consumption differs highly between bothsport building types, different requirements should bedefined. Sports facilities with indoor swimming pools arethe most energy intensive sports facilities and should meetless stricter nZEB levels than dry sports facilities. Furtherstudies should be conducted at national level to determinewhether it is necessary to include ice rink arenas as an

additional category with specific nZEB requirements.


To set less stricter nZEB levels for existing sportbuildings compared to new construction. In new nZEBconstruction, passive strategies can be considered in thebuilding design phase. Furthermore, in some existing sportbuildings as a consequence of its initial design, it can beunfeasible from the technical point of view to integraterenewable energies.

Set the minimum share of energy from renewablesources: according to EPBD, a significant amount of energydemand should be covered by on-site or nearby renewableenergy sources.


To be sufficiently flexible and adaptable to local climateconditions: nZEB thresholds should be defined for differentclimatic zones (when necessary) since weather conditionscan differ in different regions of a country.

To be ambitious in terms of environmental impact. nZEBlevels should be more ambitious than cost-optimalenergy performance levels. The results from energy auditsconducted in 26 pilot sports facilities under STEP-2-SPORTproject reveal that in existing sport buildings, a nZEB retrofittoday can lead to energy savings of over 50% additional

category with specific nZEB requirements.


Member States should also develop policies in order tostimulate the transformation of buildings that arerefurbished into nZEB. So far the EuropeanCommission only addresses directly new buildings,without establishing mandatory nZEB requirements forexisting buildings. Some countries/regions (e.g. Austriaand Brussels Capital region) have also set primaryenergy demand for existing buildings, while othercountries (e.g. Bulgaria, Cyprus, Denmark, Latvia) havedecided to keep the same nZEB levels for new andexisting buildings.


The development of standard EPC contract models for sportsfacilities, the organization of activities aimed to explain EPCbenefits to the sector and the support from governments arefactors that may stimulate this market.

Development of a mechanism for overcoming split incentives,different from Energy Performance Contracting, consisting on theaddition of green clauses in the contract agreement between thesport owner and the sport facility manager, setting mutuallyagreed performance targets to reduce the energy consumption ofthe facility during the contract duration.

There is a need to disseminate information to the sport sectoron the available financial instruments that support energyrenovations, such as national energy efficiency investment funds,citizen financing, grants, etc.


An integrative and holistic approach is needed toaccurately determine the energy performance of a sportbuilding, which is influenced by the interactions of manyelements and processes within the building and itsimmediate external environment.

Occupancy - variations in hours of operation between sportbuildings can be significant. In addition, occupant densitiescan vary significantly.

Another issue is the behavior-based approach by themanagers/owners of a sport facility to re-consider theexisting heating pattern, so as to provide the required“thermal comfort” conditions to the users (athletes andaudience) of the sport facility. This “thermal comfort” is alsoa requirement by all International sports Federations.


The parameter of CO2 emissions is missing in many EUM-S EPCs. It is a vital parameter, as CO2 is responsiblefor the existing climate change, and any attempt toreduce it can be clearly presented to themanagers/owners of a sport facility.


Thank you for your attention!

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