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Iñigo Prior
Senior Advisor Deutsche Bank – Investment Manager eeef
April 26th, 2017
eeef - European Energy Efficiency Fund
Advancing Sustainable Energy for Europe
eeef – key elements
Agenda
1
2 Portfolio Overview
eeef – Key Elements
eeef at a glance
eeef’s capital
Beneficiaries
Objective eeef is an innovative public-private partnership dedicated to
mitigating climate change through market based financing in the member states of the European Union
Initial capitalization of the fund amounting to €265m provided by the European Commission, the European Investment Bank, Cassa Depositi e Prestiti and Deutsche Bank
Municipal, local and regional (and central) authorities or public and private entities acting on behalf of those authorities such as utilities, public transportation providers, social housing associations, ESCOs etc.
Investments
Fund’s investments are split into three project categories:
Energy Efficiency (EE)
Renewable Energy (RE)
Clean Urban Transport
Commitment of the EU member states to achieve the 20/20/20 goals: 20% increase in EE, 20% reduction of CO2 emissions, and 20% RE in EU's energy mix by 2020
Substantial potential for EE and small scale RE in the European public sector
Set up a funding source to enhance EE and foster RE dedicated financing within the European Union, primarily through the provision of dedicated financing to:
municipal, local and regional (and national) authorities
public and private entities acting on behalf of those authorities such as utilities, public transportation providers, social housing associations, ESCOs etc.
Focus areas: EE, RE and clean urban transport
European Commission(Initiator)
European Investment Bank(Founding investor)
Cassa Depositi e Prestiti(Founding investor)
Deutsche Bank(Investor and investment advisor)
Objective and sponsors of the eeef
Background and objective Sponsors
eeef structure
Investors
Super-Senior Tranche
(Notes)
Mezzanine Tranche
(B Shares)
Issuer
Vehicle
Luxembourg
Junior Tranche
(C Shares)
Institutional Investors
EUR fundingEUR, Local FX investments
Investment CommitteeTechnical Assistance
Facility
Inve
stm
en
t A
dvis
or
Senior Tranche
(A Shares)
Private Investors, International Financial
Institutions or Development Finance Institutions
Mu
nic
ipa
l, lo
ca
l, r
eg
ion
al a
nd
na
tio
na
l a
uth
ori
tie
s a
nd
pu
bli
c
or
pri
va
te e
nti
tie
s a
cti
ng
on
be
ha
lf o
f th
os
e p
ub
lic
au
tho
riti
es
Direct Debt & Equity
FIs Senior & Sub
Debt LoansLoans
Management Board
Private Investors, International Financial
Institutions or Development Finance Institutions
Advantages of the eeef
Fast and flexible
financing
Professional investment advisor, decision making process from initial screening (assuming all information is provided) until financial close no longer than 6 months
One-stop shop from project development support via grants from the TA facility to tailor-made financing of projects
Various financing
instruments
The fund offers various financing instruments including senior debt, mezzanine, equity, leasing structures and forfeiting loans
Fund can also operate as the sole investor in projects (single investor transactions) to simplify implementation and lower execution costs
Long maturities
Flexible with respect to maturities:
Debt can be provided for maturities up to 14 - 16 years
Equity or mezzanine capital can be provided to act as co-sponsor or long-term subordinated risk taker
According to eeef’s investment guidelines an investment has to meet several eligibility criteria:
General eligibility criteria such as:
public link
commitment of municipality to mitigate climate change (e.g. Covenant of Mayors Initiative)
Primary energy savings of at least 20% (Co2 savings for certain technologies)
use of proven technologies
Furthermore, each technology may have its own specific eligibility criteria
Financing need of the Project from eeef shall be preferably in the range of €5m to €25m – smaller project sizes will be reviewed on a case-by-case basis
Alignment with relevant EU legislation
Eligibility criteria of the eeef
Project eligibility
Role of Deutsche Bank in the eeef
Deutsche Bank, in its role as investment advisor for eeef, is the first point of contact for private and public clients, developing projects in the energy efficiency, renewable energy or clean urban transport sector
Identifies, evaluates and structures the investments for the Fund, the final investment decision is taken by the Management Board
Manages the existing project portfolio and interacts with all fund‘s service providers
Sources new investors for the Fund
Is the key point of contact for all investors, service providers, sponsors and project companies
eeef’s typical projects are so far...
Project examples Characteristics Project structures
Building upgrades
Energy audits completed, vast energy savings
potential
Sufficient know-how of ESCO in case of big projects
Savings guarantee required
Depending on counterparty risk additional
parental/municipal guarantee required
Senior debt
Mezzanine / equity
Funding via co-
investments in SPV or
NewCo
Forfaiting
Leasing (mostly for clean
urban transport projects)
Street lighting
Only light bulbs, switch boards plus EE related
measures can be financed, not the light pole itself
Ownership of lighting points need to be in municipal
hand
Technology with good track-record only
Biomass plants
Contracts for input (feed-stock) / output (e.g.
electricity/heat) in place
Substitution of input possible
Technology with good-track record (e.g. boilers,
turbines etc.)
O&M concept
Photovoltaic
Land ownership in municipal hand
Grid connection secured
Feed-in tariff secured
O&M concept
Bankable module supplier
GERMANY €0.9m forfeiting loan to
Jewish Museum Berlin via
Johnson Controls‘ ESCO
(EE: building retrofit)
€0.6m forfeiting loan to
University of Applied
Sciences Munich via
Johnson Controls‘ ECSO
(EE: building retrofit + CHP)
ROMANIA €25m subdebt to Banca
Transilvania
(Financial Intermediary
investment: EE, RE, Clean
Urban Transport)
ITALY €32m project and VAT bond
facility to project entity
upgrading University
Hospital S.Orsola Malpighi
in Bologna
(EE: reduction on energy in
entire fluid production and
distribution system)
FRANCE €5.1m junior funds to project
vehicle to supply heat to City
of Orléans
(EE: CHP/biomass)
€7.3m junior funds to project
vehicle to supply heat to City
of Rennes
(EE: CHP/biomass)
€30m senior funding to
Bolloré
(Clean Urban Transport:
electric cars)
€5m senior construction
facility to project vehicle of
Région Rhône-Alpes
(EE: schools retrofit)
eeef investments by country – project details
SPAIN €2.5m forfaiting loan to
Universidad Politécnica de
Madrid via Enertika (EE:
building retrofit)
UK €4.2m senior debt to project
entitiy Cardenden Heat and
Power
(EE: boiler replacement and
RE: onshore wind)
NETHERLANDS €8.5m senior debt to City of
Venlo
(EE: public lighting)
eeef Technical Assistance Facility
• Following the European Commission TA
Facility managed by the EEEF, the Fund
set up the EEEF TA Facility to support
ambitious public beneficiaries in developing
bankable sustainable energy investments.
• The EEEF TA Facility aims to bridge the
gap between sustainable energy plans and
real investments through supporting all
activities necessary to prepare investments
into sustainable energy projects.
• Going forward EEEF is open (no deadline)
for TA project proposals on a first-come-
first-serve basis, subject to availability of
funds and the Fund’s appetite for proposed
sector/technology etc.
More info: http://www.eeef.eu/general-
introduction.html
Portfolio Overview
14
eeef’s typical projects are so far...
Project examples Characteristics Project structures
Building upgrades
Energy audits completed, vast energy savings
potential
Sufficient know-how of ESCO in case of big projects
Savings guarantee required
Depending on counterparty risk additional
parental/municipal guarantee required
Senior debt
Mezzanine / equity
Funding via co-
investments in SPV or
NewCo
Forfaiting
Leasing (mostly for clean
urban transport projects)
Street lighting
Only light bulbs, switch boards plus EE related
measures can be financed, not the light pole itself
Ownership of lighting points need to be in municipal
hand
Technology with good track-record only
Biomass plants
Contracts for input (feed-stock) / output (e.g.
electricity/heat) in place
Substitution of input possible
Technology with good-track record (e.g. boilers,
turbines etc.)
O&M concept
Photovoltaic
Land ownership in municipal hand
Grid connection secured
Feed-in tariff secured
O&M concept
Bankable module supplier
15
Investments by Projects (in %) Investments by Country (in %)
Investments by type of Partner Institution (in %) Investments by Sector (in %)
79%
21%
Direct Investment Financial Institution
eeef investments as of 12/2016
26%
25%21%
7%
6%
4%
4%3% 2% 1%1%
University Hospital S. Orsola Malpighi Bolloré AutolibBanca Transilvania City of VenloDalkia City of Rennes Dalkia City of OlrèansSPL - Region Rhone-Alpes Cardenden Heat & PowerUniversidad Politécnica de Madrid Jewish Museum Berlin FoundationUniversity of Applied Sciences Munich
39%
26%
21%
7%4% 2%1%
France Italy Romania Netherlands UK Spain Germany
61%
25%
14%
Energy Efficiency Clean Urban Transport Renewable Energy
Project description
Partners: Progetto ISOM S.p.A (project SPV)
University Hospital S. Orsola Malpighi (grantor
of concession)
Measures:
energy
efficiency
CCHP
Upgrade of entire fluids’ production and distribution
system of the hospital
Including a tri-generation plant for the combined
production of cooling, heat and power (CCHP)
Results: Reduction of CO2 emissions of 14,136 t p.a.,
approx. 31% compared to baseline
16
Energy efficiency upgrade of the University
Hospital S. Orsola Malpighi - Bologna, Italy
Location
Project structure Investment characteristics
Key data:
Total project volume: € 41m (equity provided by Manutencoop
Facility Management, Siram, Sinloc and Iter Cooperativa
Ravennate)
EEEF funded volume: € 32m via a project bond structure
Duration of financing: 20 years
Highlights:
Largest energy efficiency upgrade in Italy under a Public Private
Partnership (PPP) framework
Complex energy efficiency upgrade of the hospital - won the
'CESEF Energy Efficiency Award 2015' in the Financial category
SPV Progetto
ISOM S.p.A.
Project bond +
VAT bond
Equity funding
UHSOM (Grantor of
concession)
Concession
agreement
EPC & O&M
consortium
EPC and O&M
Manutencoop Facility Management Siram Sinloc
Region
Emilia
Romania
Regional funding
of healthcare
Bologna, Italy
Project description
Partners: City of Orléans, Dalkia France, eeef
Measures:
Biomass
plant/
energy
efficiency
Dalkia won a public tender realized under a French
Regulation Commission Tender („CRE3“) for
electricity /heat generation fired by biomass
Biomass-fired combined heat and power plant with
a capacity of 7.5 MW in electricity and 17 MW
thermal energy
Results: Reduction of CO2 emissions of 20,500t p.a., approx.
89.1% compared to baseline
Energy production 50,826 kWh p.a.
Combined Heat and Power Plant (biomass) –
City of Orléans, France
Location
Project structure Investment characteristics
Key data:
eee is a 84.4% shareholder of Orléans Biomasse Energie s.a.s
Total project volume: € 36m
Total junior funds volume: € 6m
Duration of financing: 18 years
Highlights:
Decentralized energy supply for City of Orléans using existing
district network
Supply of biomass within 100 km
Long term PPA agreement with EDF
Orléans Biomasse
Energie s.a.s
Dalkia Biomasse
Orléans s.a.s
Operation and
maintenance ,
Incl. biomass supply
Contract for
electricity sale
City of
Orléans
Land rights
agreement
Construction
contract
Public concession for
Heat supply to district
heating network
EDF
Orléans, France
Project description
Partners: University of Applied Sciences Munich (UoM),
Johnson Controls, eeef
Measures:
Building
upgrade/
energy
efficiency
Installations of combined heat and power plant
Installation of energy efficient lighting
Optimization of heating
Optimization of building management
Results: Reduction of CO2 emissions 88t p.a. approx. 11.6%
compared to baseline
Guaranteed energy savings € 118,860 p.a. (41.7%)
18
Location
Financing structure Investment characteristics
Key data:
Financing volume: approx. € 0.6m
Duration of financing: 10 years
Highlights:
Second project with the innovative forfeiting structure
EE measure including a CHP plant (decentralized energy
production)
Role model for further energy efficiency investments in schools,
universities etc.
2
UoM
(Employer)ESCO (Seller)
(Purchaser)
Implementation of EE
measures acc. to
energy performance
contract (EPC)
Pays receivables/
energy savingsForfaiting agreement:
purchase of
70% of receivables /
energy savings
Savings guarantee
1
3
Building retrofit of the University of Applied
Sciences - Munich, Germany
Munich, Germany
Project description
Partners: Banca Transilvania S.A. (‘BT’)
Measures: EEEF and BT, one of the leading banks in Romania
signed a letter of intent regarding green lending to
support energy efficiency and renewable energy
investments
Provision of financing to public and private building
owners, homeowner associations and municipalities,
public sector entities and private sector companies
acting on behalf of the public sector
Results: Average CO2 emission reduction of at least 20% for
projects financed via BT
19
Location
Financing structure Investment characteristics
Key data:
Financing volume: approx. € 25m
Duration of financing: 10 years
Highlights:
First cooperation of the EEEF with a financial institution and also
EEEF’s first project in Eastern Europe
Strong local partner with credentials in financing several energy
efficiency projects
Role model for further Financial Institutions investments(Sub-
borrowers)(Borrower)
(Lender)
Sub-loans for EE and
RE projects
Loan Agreement
Green lending cooperation with Banca Transilvania-
Cluj-Napoca, Romania
Cluj-Napoca,
Romania
Project description
Partners: City of Venlo (Borrower)
Measures:
Energy
efficiency
Street
lighting
The City of Venlo upgrades of the existing street
lighting network of the city with energy efficient LED
lamps
The existing O&M contract for the street lighting
network with a private service company stays in
place and includes the upgraded lighting points
Results: Achievement of primary energy savings of around
62% p.a. compared to baseline
20
Street lighting upgrade of the City of Venlo -
Venlo, Netherlands
Location
Project structure Investment characteristics
Key data:
Total project volume: € 8.5m
eeef funded volume: € 8.5m via a senior debt loan covered by the
City of Venlo
Duration of financing: 15 years
Highlights:
First direct lending to a municipality by eeef. The street lighting
upgrade is part of an overall green development plan of the city
Reference project for European public authorities demonstrating
efficient financing solutions for energy efficiency and renewable
energy projects via eeef
(Lender) (Borrower)
Loan Agreement
Obligation to invest
into energy
efficiency projects
Venlo, Netherlands
Project description
Partner: Bolloré S.A.
Measures:
Public urban
transpor-
tation
Bolloré SA won the concession for the first large
scale electric vehicle renting scheme in the greater
Paris region (Ile-de-France)
expansion of Bolloré’s core infrastructure (e.g. cars,
charging stations, rental kiosks)
Results: Reduction of CO2 emissions of min. 50% compared
to baseline
21
Car-sharing programme for electric cars-
Cities of Paris, Lyon and Bordeaux, France
Location
Investment characteristics
Key data:
Bond issue (private placement): € 30m
Duration of financing: 5 years
Repayment: Bullet structure
Highlights:
First eeef transaction for clean urban transport in Europe
51 municipalities in the Paris/ Île-de-France region participating,
accessible to more than 4 out of 7 million inhabitants
Project structure
Paris, Lyon and
Bordeaux, France
Obligation to
expand core
infrastructure
Bond
purchase
100% 12 year concession for the
Paris/ Île-de-France region;
Lyon and Bordeaux to come
BordeauxParis Lyon
Project description
Partner: Universidad Politécnica de Madrid (UPM)
Measures:
Energy
efficiency
Building
retrofit
Energy efficiency measures in 32 buildings of the
University
Substitution of the 63 oil based with the gas based
boilers
Installation of 6,800 thermal valves in the heating
system an solar panels
Installation of a global energy management service
Results: Targeted primary energy savings of 27% and CO2
savings of 45% compared to baseline
22
New heating infrastructure for the Universidad
Politécnica de Madrid, Spain
Location
Investment characteristics
Key data:
Forfaiting structure to purchase receivables obligations related to
installation works: €2.5m
Duration of financing: 9 years
Repayment: monthly
Highlights:
Transaction completed in three months after signing of the Energy
Management Contract by the UPM and Enertika, demonstrating the
ability of the private and public sectors to align efforts to implement
projects in the energy efficiency sector
Project structure
Madrid, Spain
2
UPM
(Employer)
(Purchaser)
Implementation of EE
measures acc. to
Energy Management
Contract
Monthly payment of
the relevant share
based on issued
invoices Purchase of
of receivables
1
4
ESCO (Seller)
3
Pledge of
equipment
Project description
Partner: Cardenden Heat & Power Ltd
Renewable Energy Infrastructure Fund (REIF)
Measures:
Energy
efficiency
Wind
Gas boiler upgrade of more than 200 homes owned
by the local housing association
Construction of small size onshore wind-farms (each
0.5MWe) in the Fife Region
Results: Reduction of CO2 emissions of 1,732t p.a., 96%
compared to baseline
23
Energy efficiency upgrade of social housing homes and
construction of small size wind plants – Cardenden, UK
Investment characteristics
Key data:
Total project volume: €5.4m
eeef funded volume: €4.2m via a senior loan
Duration of financing: 15 years
Highlights:
First small scale wind power project development financed by the
eeef
eeef collaborated with the Scottish community to address the
technical and financial aspects to plan and implement climate
change related project
Location
Cardenden, UK
Project structure
Cardenden
Heat & Power
Senior loan
Equity funding
REIF
Subordinated
loan
EPC and
O&M partners
EPC and
O&M
Ore Valley Housing Association
Contacts
European Energy Efficiency Fund (eeef)
Lada Strelnikova
+49 (69) 910 46444
Iñigo Prior
+49 (69) 910 48603
Paola Rusconi
+49 (69) 910 84768
Matthias Benz
+49 (69) 910 46449
Zarpana Signor
+49 (69) 910 49858
www.eeef.eu
© Copyright 2017. European Energy Efficiency Fund, SICAV-SIF, 31 Z.A. Bourmicht, L-8070 Bertrange, Luxembourg. All rights reserved.
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provided in this Document and to communicate the received information of this Document to any third party without the prior written consent of
European Energy Efficiency Fund.
The Document is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefing provided by European
Energy Efficiency Fund. The Document is neither intended to serve as legal or tax advice nor should it replace it.
The information in the Document reflects prevailing conditions and European Energy Efficiency Fund's views as of this date, all of which are
subject to change.
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representation, warranty or undertaking, express or implied, as to the accuracy, reliability, completeness or reasonableness of the Document.
The aforementioned persons will be under no duty to provide access to any additional information or to update or correct (if required) any
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