• Energy Research

On-bill schemes are innovative financial frameworks for supporting investments in energy efficiency with a particular focus on residential buildings. These schemes are interesting since they allow to attract private capital in the energy efficiency market, and they also see the involvement of energy utilities which can be regarded as market aggregators. Despite the conceptual simplicity of these mechanisms, namely the utility provides upfront capital for the investment which is repaid by final users on the bill in a number of years, solid and innovative business models are necessary to support their development and implementation. To this aim the present paper employs the Value Flow Model to develop four business models to implement on-bill schemes. In particular, standard on-bill financing and on-bill repayment business models are developed in detail. In addition, more complicated and innovative business models, namely on-bill repayment via a Special Purpose Vehicle and on-bill repayment with a Master Servicer, are also developed for more complex schemes. These four fundamental business models can be used and adapted according to market context of operation. Finally, the possible involvement of Distribution System Operators as service providers or facilitators for on-bill schemes is also outlined.

Abstract The Energy Performance Contracting (EPC) market is still embryonic in South Europe since there are still many barriers: difficult access to financing, limited investors’ confidence in EPC models, scarcity of flagship projects, lack of certification schemes and financing mechanisms, especially for the tertiary sector (hospitality, tourism, healthcare), which presents a huge potential for Energy Efficiency (EE). The Trust EPC South project, funded by Horizon 2020 Research and Innovation Programme, aims to scale up investments in EE solutions in the private tertiary sector in South Europe, by delivering a robust investment standardization and benchmarking framework and a pipeline of bankable EPC projects in 6 countries (Portugal, Spain, France, Italy, Croatia and Greece); its results will eventually be extended to the Balkan. Tailored capacity building activities will allow an easier access to third-party financing, thus unlocking the large tertiary sector EE and Renewable Energy market potential. Initially, national market analyses took place (EPC providers, beneficiaries-clients, and financial institutions) to identify the market potential. National Discussion Platforms were set up to develop the national roadmaps addressing mechanisms for mitigation of policy, legal, and especially financial barriers. An investment standardization and benchmarking framework, built upon an established real estate assessment tool (Green Rating™), is actually setting up in order to build trust amongst all parts of the EPC value chain. The methodology will be upgraded including a financial assessment model.

Artículos en revistas Solar photovoltaic is increasingly seen as a key technology for low-carbon electricity generation. However, the deployment of growing shares of this technology is not without important challenges for their efficient integration in power systems. This paper aims to contribute to overcoming the barriers that hamper a large-scale integration of photovoltaics in the electricity distribution grids. The methodology followed is problem oriented. The paper firstly reviews the technical solutions available to integrate distributed photovoltaics, classifying them in three areas: Distribution System Operator (DSO) solutions, prosumer solutions and interactive solutions. Then, the set of barriers that hinder the implementation of the solutions in a European context are identified, assessing the relevance of each barrier in different countries. Four major barriers are discussed in detail: (1) DSO regulation does not promote smart grid investments, (2) rules limiting PV curtailment, (3) missing frameworks enabling DSOs to access advanced PV inverter capabilities, and (4) regulation hampering storage solutions. Finally, recommendations to overcome these barriers are presented, highlighting that DSO regulation should shift the focus from a short-term to a long-term cost assessment and revenue setting framework, equalizing the treatment of capital and operational expenditures, and implementing specific incentives for DSO innovation. Moreover, a fair debate on the definition of the boundary conditions for the use of renewable curtailment when the other technical solutions cannot be applied or are not economically optimal is required. Regarding the provision of services to DSOs by prosumers and the deployment of distributed storage, the roles, rights and limitations of the different stakeholders need to be clearly defined. info:eu-repo/semantics/publishedVersion

On-bill schemes are innovative financial frameworks for supporting energy renovation based on private capital. Direct intervention of public authorities may not be necessary. The pivotal role is assumed by energy utilities which are the originators of the business and act as market aggregators. On-bill schemes are based on a simple principle, namely the utility supports the energy renovation of final users by providing the upfront capital to repay on the utility bill. This implies that energy supply and renovation services are provided by the same company. This could be a limitation since the user may be obliged to stay with the same energy supplier for all the duration of the on-bill scheme. Even more complications can arise when the dwelling is sold or rent to another tenant. For such a reason it is important to find solutions for the possible decoupling of energy supply and energy renovation services. The present paper introduces an innovative business model which involves Distribution System Operators or other designated entities acting as market facilitators supporting the decoupling between energy supply and building energy renovation services. To characterise precisely the business ecosystem and the relations among the different actors, the Value Flow Model is employed.

Implementation of energy efficiency interventions in the residential sector is pivotal to drive the energy transition and achieve energy policy targets. For such a reason, public programs supporting the renovation of residential buildings are available globally, but public incentives are not enough to address all the potential and it is necessary to attract private investments. An innovative approach to consider is represented by on-bill schemes, which foresee investments by energy utilities with possible cooperation of financial institutions. The present contribution proposes an in-depth description of on-bill mechanisms, their possible frameworks, the barriers to their implementation as well as the impact they may have on the core business of utilities. The study is based on a review of the existing literature integrated with the results of on-field interviews and discussions with the aim to obtain a full picture of on-bill schemes in a European replication perspective. Methodologically, the paper is based on structured desk research and on-field feedback obtained from selected stakeholders. Additionally, a SWOT analysis is developed highlighting that on-bill schemes may result very convenient for power utilities and energy retailers. Furthermore, on-bill schemes can help to address the issue of the split incentives. In conclusion, on-bill schemes can be considered a valid tool to support energy renovation in the residential sector, but they do not represent a global solution since their application is not tailored for all the contexts. The analysis highlights that power utilities are in a strong position since they can use on-bill schemes to switch part of the demand from fossil fuels , e.g., natural gas, to electrical power. Similarly, energy retailers are in a good position since they can enlarge their business by selling energy efficiency as a service through on-bill schemes.