Setting Up Facilitation Structures to Accelerate the Renovation Wave in the Public Sector

The public sector plays a key role in delivering the energy transition, with a unique mandate over their public assets and a unique convening power on actors across the value chain. The European Green Deal’s Renovation Wave^[1] aims to double the renovation rate of buildings by 2030, which requires also massive investment into the public building stock. Moreover, Member States have to set out measures in their long-term renovation strategies in order to ensure a highly energy efficient and decarbonised national building stock and in order to facilitate the cost-effective transformation of existing buildings into zero-energy buildings^[2]. In line with the REPowerEU plan^[3] to phase out EU dependence on fossil fuels imports, the public sector is called to play a key role in reducing its energy consumptions through building renovations.

Currently, a substantial barrier to increased renovation rates in the public sector is to create and sustain long-term the financial and technical capacity amongst public authorities to develop projects. In particular, small and medium-sized municipalities often do not have sufficient resources to dedicate staff towards developing a project pipeline.

The challenge remains to upscale ambitious energy renovations of public buildings to demonstrate the exemplary role of the public authorities in decarbonising their assets and leading the way towards the European clean energy transition.

Hence, facilitation structures (e.g. one-stop-shops or similar) are needed at regional and national levels that can support a larger number of public project promoters in designing and delivering ambitious renovation projects in the public sector at scale and capitalising on existing solutions.

The experience from the technical assistance facilities (ELENA, H2020 PDA, eee-f) has shown that a range of competences are needed in public project promoters to bring sustainable energy projects alive, namely expertise in technical aspects (energy audits, project design), financial engineering (Energy Performance Contracts, blending different finance sources) and legal aspects (bundling, pooling, procurement, applying Energy Performance Contracts).

Proposals should establish and operate regional/national facilitation structures, for example one-stop-shops, to accelerate the renovation wave in the public sector (e.g. office buildings, social housing, schools, leisure facilities etc.) covering a larger territory and offering a comprehensive, all-inclusive service from technical, financial to legal advice, procurement and quality assurance of works.

The proposal needs to demonstrate clearly how the facilitation structures will be established in terms of governance, mandate, geographical coverage and sustainability.

Proposals need to describe the comprehensive service package that will be offered to public authorities which should include:

• Demonstrating how they will achieve long-term sustainability of the facilitation structure by obtaining stakeholder support and becoming financially self-sustaining.
• Approaches to reduce complexity and simplify decision making for public authorities to stimulate demand for building renovation and energy performance improvements.
• Approaches to proactively identify and mobilise public buildings for comprehensive energy refurbishments.
• Promoting the uptake of cost-effective deep renovation of buildings with highly ambitious energy savings in line with the Europe’s decarbonisation target.
• Legal assistance to facilitate and prioritise the aggregation of building renovation projects (belonging to one or several public entities) with the aim to upscale overall renovation and attract private investors.
• Development of efficient procurement processes ensuring that renovations are delivered at pace, enabling the bundling/upscaling of renovation projects and ensuring high quality of renovation works (including ambitious energy savings).
• Financial engineering support to facilitate the use of financial instruments and market-based instruments such as Energy Performance Contracts, refinancing models, Green/White Certificates, energy efficiency obligation schemes and, to increase blended finance of public and private sources and uptake of EU funding sources such as InvestEU, Recovery and Resilient Facility and European Structural and Investment Funds including REACT-EU and Just Transition Mechanism.
• Approaches to engage with relevant actors in the value chain e.g. construction companies, architects, engineers, urban planners, financiers, etc.
• Approaches to improve awareness and trust towards such facilitation structures through clear accountability, cost and service transparency and quality assurance.

Proposals should build on the vast experiences and solutions developed by over 150 ELENA and PDA/MLEI projects amongst other relevant experiences.

Proposals should support public authorities in finding alignment of their proposed investment with the guidance provided in the EU Sustainable Finance policy and legislation, in particular alignment with the EU taxonomy criteria, or going beyond the minimum requirements set out therein.

The Commission considers that proposals requesting a contribution from the EU of a range of EUR 1 million to EUR 1.5 million would allow the specific objectives to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts.

Proposals may be submitted by a single applicant or by applicants from a single eligible country.

Proposals should result in long-term facilitation structures which are tested, implemented and operational at the end of the action, i.e. delivering renovation projects.

Proposals should quantify their impacts using the indicators listed below, where relevant, as well as other project-specific performance indicators:

• Number of buildings with increased energy performance (e.g. ZEB levels) owned by public authorities in the specific areas/territories targeted with the facilitation structures.
• Number of public authorities supported through the services of the facilitation structures.
• Investments in sustainable energy triggered by the project (cumulative, in million Euro).
• Primary energy savings triggered by the project (in GWh/year).
• Renewable energy generation triggered by the project (in GWh/year).
• Additional amount of funding support (EU and/or private sources) leveraged into the territory thanks to facilitation services.
• Number of jobs directly and indirectly created.

The impacts of the proposals should be demonstrated during the project and within 5 years after the project lifetime.

[1]Communication from the Commission to the European Parliament, the European Council, the European Economic and Social Committee and the Committee of Regions, A Renovation Wave for Europe - greening our buildings, creating jobs, improving lives, COM(2020) 662 final

[1] Proposal for a Directive of the European Parliament and of the Council on the energy performance of buildings (recast), COM(2021) 802 final

[2]Directive 2010/31/EU of the European Parliament and of the Council of 19 May 2010 on the energy performance of buildings (europa.eu), amended by Directive (EU) 2018/ of the European Parliament and of the Council of 30 May 2018 amending Directive 2010/31/EU on the energy performance of buildings and Directive 2012/27/EU on energy efficiency (europa.eu)

[3]Communication from the Commission of 8.3.2022 to the European Parliament, the European Council, the European Economic and Social Committee and the Committee of the Regions, REPowerEU: Joint European Action for more affordable, secure and sustainable energy, COM(2022) 108 final.