SUNShINE

SUNShINE: Save your bUildiNg by SavINg Energy – towards 202 020 m²of deeply renovated multifamily residential buildings

Comprehensive building renovation makes it possible to preserve the full economic energy-efficiency potential of existing buildings, providing significant energy savings. However, achieving this requires design, financing, and implementation of complex energy-efficiency investments, which in Latvia is challenging because most apartments are privately owned.

Experience shows that the lack of technical knowledge, limited access to financing, high perceived risks, and unwillingness to take on debt are the main barriers preventing residents from starting renovation projects. Apartment owners are often insufficiently organized to manage their shared property, while building conditions continue to deteriorate rapidly due to Latvia’s climate conditions and inconsistent building management practices.

Project objective:

The SUNShINE project supports both public and private ESCOs. The project provides an innovative investment scheme for projects worth EUR 30 million, delivering guaranteed energy savings of more than 26 GWh per year and enabling the comprehensive renovation of more than 202,020 m² of buildings.

The main objective of the project is to demonstrate the financial viability of comprehensive building renovation projects by combining appropriate public funding with private capital.

The proposed approach is simple yet innovative — most ESCO companies have limited balance sheets and therefore are unable to financially support multiple long-term debts.

Project activities:

• Refinancing is achieved through the sale of future cash flows (receivables) using a forfeiting transaction. After this transaction, the ESCO continues to guarantee energy savings throughout the entire EPC contract period (15–20 years).
• Unfortunately, in emerging EPC markets such as Latvia, there is insufficient information about this financing model and a lack of practical experience. As a result, banks are often not prepared to offer such services to ESCO companies.
• The project addresses this issue by creating a dedicated special-purpose EPC fund that provides the same financing mechanism.

Project implementation period 01.03.2015 – 01.03.2018

The project was implemented under the Horizon 2020 Framework Programme for Research and Innovation, priority “Societal Challenges”, topic: “Secure, Clean and Efficient Energy”under Grant Agreement No. 952924.