#celive #seuk @CleanEnergyLive cleanenergylive.co.uk

4-6 October 2016 The NEC, Birmingham, UK

#celive #seuk @CleanEnergyLive cleanenergylive.co.uk

Clean Energy Live

05 October 2016

Alex Gilbert – Amber Infrastructure Ltd

Amber is a Sponsor and Fund Manager of Social and Environmental Infrastructure

Assets. It has within its portfolio over 120 projects and ~£5bn of assets under

management

International Public Partnerships (INPP)

A public FTSE-listed infrastructure company, launched in 2006,

specialising in essential social infrastructure in developed countries

The London Energy Efficiency Fund (LEEF)

A specialist fund, launched in 2011, established by the Mayor of London

and the European Investment Bank (EIB), investing in energy efficiency and

district heating in the capital’s buildings

The Scottish Partnership for Regeneration in Urban Centres (SPRUCE)

A specialist fund, launched in 2011 by the Scottish Government and

the EIB, with support from RBS, investing in Scottish regeneration

Amber Infrastructure

Utilising its own balance sheet for specific infrastructure, new energy

and property investments

£215m of JESSICA capital and a focus on direct investment (risk

capital) into Storage and Communal / District Heating schemes

Amber Green – Sustainable Fund Management

An Introduction

• LEEF has £112m from the London Green Fund and the private sector; to be lent to public

or private sector borrowers on projects that promote energy efficiency

• We will work with building owners, developers, ESCOs and other project promoters

• LEEF can also support larger projects such as Combined Heat and Power, District

Heating and Renewable Energy Generation

• Loans are extremely flexible and competitive; with tenors of up to 10 years and interest

rates from 1.70% per annum

You can benefit from LEEF if …

• You are undertaking a refurbishment programme / retrofit project in a London-located

property

• Your works contribute to improved energy efficiency through reducing consumption and/or

carbon emissions

• Your funding requirement is between £1m and £20m

• You wish to work with RE:FIT, RE:NEW or other such frameworks

5

LEEF Investment Criteria

Heat & Power in London: Two Sources of Finance

London Energy Efficiency Fund

• A £112m fund; successfully deployed and now in its recycling period (until 2018)

• Focus on Energy Efficiency; Renewables; and Low Carbon Heat

• Typically offers fixed rate loan facilities – flexible and up to 10 years (may be

tailored to projected energy savings)

• Drawdown profile to match the capital expenditure – 100% funding

Output Targets

• 20% energy or carbon saving (building retrofit only)

• <£5,000 / tonne of CO2 saved

Procurement, Finance & Delivery

• No requirement to procure

• Borrowers may wish to procure works from an ESCO using an EPC

Amber Heat & Power

• Equity-financing energy infrastructure

• Likely to be DBFOM

• May inc. CHP, EfW, Purpose-Built Electricity Generation, Battery Storage

• Demographics, weak energy infrastructure and local / central government support

• Synergistic with Amber’s PPP background and expertise

Output Targets

• No carbon targets; Project IRR of 8-12%

Procurement, Finance & Delivery

• May involve OJEU or other procurement

• Developers keen to partner with, but outsource to, ESCo specialists

• Amber has access to European Funds (for instance, LEEF)

The Changing Grid: An Opportunity for Storage Investment

• Traditional generation such as coal and gas turbines, use rotating equipment that naturally resist

changes in frequency due to the sheer mass of the spinning turbines. Renewables like wind and

solar are increasing but have less inertia per unit of generation capacity.

• All coal plants due to shut by 2025 with many already closing as no longer viable.

• Predicted losses of system inertia somewhere between 15%-20% by 2020, and up to 40% by 2025.

• Energy Storage, in particular, Li-

Ion Batteries have the ability to

respond faster than any existing

technologies, making the grid

more stable and reducing the

requirement for existing services,

effectively reducing NGET costs

of managing the grid.

The Case for Heat

Peak Gas Demand

• 5x level if spread evenly over the seasons

• 12x the Summer max

• 6x current peak in electricity system

… allowing for the fact that this is changing!

LEEF – A Success Story?

Backed 7

major carbon

saving projects

Committed

£67 million

of capital

Invested

throughout

the Capital (76

buildings across 9

London Boroughs)

Mobilised

£350m external

finance through

our capital

Saved 20,000,000

kWh of energy; the

equivalent of 1,100

homes

Reduced annualised

CO2 emissions by

35,000 tonnes;

equivalent to taking

32,000 cars off

the road

Supported 1,600

construction and

operational jobs

Case Studies – LEEF: PRIVATE SECTOR HEAT & POWER

£14.5m – Greenwich Peninsula ESCo

Loan to fund an energy centre and

district heat network serving the

Greenwich Peninsula regeneration

development

15,000 residential units and 3,500,000

sqft of commercial space to be

served by the CHP and heat network

Significant leverage of private sector

investment

Substantial (20,000 tonnes p.a.)

carbon savings over scheme’s life

LEEF’s first private sector deal and

its initial funding through ‘Recycled

Capital’

Case Studies – LEEF: THE REFURB

£20m – Tate Foundation

Off balance sheet to the Tate Gallery

Flexible, low cost financing solution,

using public and private sector

capital

Forecast energy savings of 26% p.a.

(7.7GWh)

Forecast CO2 savings: 2,500 tonnes

Carbon neutral new-build extension

Energy Conservation Measures

include: pioneering transformer waste

heat recovery; River Thames bore-

hole cooling; passive measures to

fabric; ‘gallery standard’ lighting,

metering and controls

£13.3m – St George’s NHS Trust

Installation of a CHP plant,

remodelling of an energy centre and

broad ECM retrofit

An innovative source of funding to an

NHS entity proceeding through the

Foundation Trust conversion process

Project tender won by British Gas and

to be delivered under an Energy

Performance Contract with

guaranteed energy savings

Expected to save over 7,000 tonnes of

carbon and reduce energy usage by

6.5 million kWh (58%)

Case Studies – LEEF: THE EPC

£4.6m – London Borough of Hackney

Installation of a communal heating system

in ten social housing blocks, providing

significant fuel poverty alleviation

Procured via the GLA’s RE:NEW

framework

Provision of energy to 1,500 social

housing tenants; average energy bill

reduced by 56% (£980)

Potential 40% CO2 savings due to fuel

switch

Private sector finance, in the form of

Npower ECO grant; for domestic works

LBH benefits from lower maintenance

costs and O&M contract with ESCO

Case Studies – LEEF: THE FUEL SWITCH

£3.6m – London Borough of Croydon

A low cost of finance loan to energy

efficiency schemes being prioritised by

the Council

Over 30 separate buildings being

extensively retrofitted, including: schools,

libraries, social housing and civic

buildings

Forecast energy savings of 17% per

annum

ESCO procured under the GLA’s RE:FIT

scheme, which includes the benefit of an

energy savings guarantee

Wider scheme may leverage European

Investment Bank monies

Case Studies – LEEF: THE FACILITY

£6m – London Borough of Enfield

Seed-capital for a substantial, path-finding

district heating network

Waste energy from the Edmonton (EfW)

Eco Park, plus additional heat sources, to

serve over 6,800 homes and businesses

First project in the UK to be ‘match-

funded’ through collaboration between the

EIB and a JESSICA Fund

Potential 50% CO2 savings compared to

standard alternative (8,000 tonnes p.a.)

Project advised by DEPDU, the GLA’s

Decentralised Energy Project Delivery Unit

Case Studies – LEEF: THE DE SCHEME

Case Studies – LEEF: THE HERITAGE BUILDING

£Undisclosed – Salters Livery

Company

A debt-financed project that will reduce

energy consumption by 39%, across two

sites: the Salters Livery Hall on the

Barbican Campus and an office block on

King William Street

Improves the rental capabilities of the

property

Forecast CO2 savings: 592 tonnes

One of the first refurbishments in London

to reach a BREEAM “Excellent” standard

Debt financing

ECM upgrades to: lighting; building

fabric; space/water heating

The Investor Confidence Project

The Developer /Contractor markets don’t have sufficient

equity of their own

The Banking market remains very cautious and is

unlikely to lend more than 65% ( not sure what

benchmarking provisions that the NIIF will have to

operate within)

For an exceptional but speculative project the NIIF may

initially consider higher levels of equity (possibly seeking

to partner with another party to avoid concentration risk

et al)

Once momentum generated it would be the ambition to

reduce equity levels

Need to explore and compare the different business

risks in the Belfast/ NI market to other locations in the

UK.

• The ICP is an EC Horizon 2020 project that aims to unlock access to

finance by standardizing how energy efficiency projects are developed,

documented and measured

http://europe.eeperformance.org/

• On Site Power Generation for a London based private sector office

• ESCO pays for and installs a CCHP

• Offtaker purchases power at less than the grid price

• Payback period longer than banking market is comfortable with

• Refinancing risk too great for the ESCO and Offtaker

• LEEF will address market failure given assurances on system

performance and savings

Contact Info

Contact Name Role Email Phone

Alex Gilbert Relationship /

Technical

alex.gilbert@amberinfrastructure.com 020 7939 7106

Peter Radford Finance peter.radford@amberinfrastructure.com 020 7939 0591

Joanne Patrick Legal joanne.patrick@amberinfrastructure.com 020 7939 7103

Leo Bedford Director leo.bedford@amberinfrastructure.com 020 7939 0550

For further background / general information:

www.leef.co.uk

www.ambergreenspruce.co.uk

www.amberinfrastructure.com

For project / funding specific information: