Deals

UK focus on energy efficiency ‘encouraging’

However, more remains to be done to unlock investment according to Ingenious Clean Energy, which has completed its latest deal in the space.

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Ingenious Clean Energy, the London-based investor and adviser which has just agreed an energy efficiency upgrade at a Dorset secondary school, has hailed the focus on energy efficiency in the UK Budget last week.

“Energy efficiency was referred to a number of times in the Chancellor’s Budget reflecting the seriousness with which it is taken by government,” said James Axtell, an investment director at Ingenious in a statement.

However, he added: “To most effectively unlock the industry for private investment, the government should introduce measures to allow the public sector to more easily undertake initial energy efficiency projects by improving procurement processes and stimulating the early adoption of energy efficiency.”

The greater focus on energy efficiency is designed to mitigate higher energy prices and is being adopted increasingly by schools, local authorities, housing associations, leisure centres and councils.

Energy efficiency projects are typically based on an ESCO (energy savings company) model where the owners of buildings bear no upfront costs and ESCOs and investors recoup the costs of installation through sharing in the energy savings generated.

In its latest deal in the space, Ingenious has teamed with AESSL – an ESCO – to invest £2 million (€2.4 million; $3.3 million) to transform energy usage at St Mary’s, a 300-pupil secondary school in Shaftesbury in Dorset, England. The project includes: 220kWp (kilowatt peak) of solar PV in the grounds and on roofs; a 995kWp biomass boiler for the school’s buildings; a new air handling unit for the swimming pool; 1,600 new LED lamps; valve insulation to help the heating infrastructure; and 130 smart meter points.

The measures are expected to reduce the annual energy bill at the school by £130,000.

The investment came from the Ingenious Energy Efficiency EIS Fund, £10 million fund closed in May 2012. Energy efficiency was originally one of three strategies for the £180 million-target Ingenious Clean Energy investment trust, which is soon to list on the London Stock Exchange. However, it was decided that energy efficiency should be a separate strategy, and the fund will now focus on wind and solar.