Effective Energy & Carbon Reduction EAUC 12 th Annual Conference - 31 st of March 2008

1. Effective Energy & Carbon Reduction EAUC 12th Annual Conference - 31st of March 2008 Kevin McDonald & Paul Smyth - Salix David Stutchfield – St Andrews Our mission is to work with the public sector to reduce carbon emissions through investment in energy efficiency and renewable technologies.

2. Salix Finance – Agenda Introduction to Salix Finance Update on current HEI & FE activities HEI activities – new opportunities from April 08 Recent improvements to the fund St Andrews - A Client’s perspective Questions?

3. Salix Finance Introduction to Salix Finance

4. Salix Finance – who are we? Independent not-for-profit company Set up by the Carbon Trust in 2004 Work only with public sector bodies To reduce energy costs and carbon emissions Show leadership in tackling climate change

5. Salix Finance – what do we do? Stimulate investment Using ring-fenced funds Recycle all projected savings Focus on cost-effective projects with high CO2 reduction impact Match funding – typically £250K Initial fund spent over 2 years Reduce energy bills Make capital go twice as far

6. Salix Finance - types of technology • The following lists the main types of technology in the fund • BEMS • Boiler replacements and controls • Cooling and heating projects including controls • Insulation Building Fabric • Lighting upgrades and controls • Motors and motor controls • Office equipment improvements and network PC management • Renewables • Swimming pool covers and controls • Ventilation • Voltage reduction

7. Salix Finance – All Clients projects breakdown

8. Salix Finance – All clients projects breakdown Insulation Projects Insulation Projects

9. Salix Finance - project criteria • Projects must deliver both CO2 & revenue benefits • Two project compliance criteria • 5 year payback period and £100/tCO2 • 7.5 year payback period and £50/tCO2 • Energy efficiency projects • As documented in the Salix Project tool • Or approval through suitable demonstration project • CHP and renewable energy technologies • Include a feasibility study carried out according to a recognised methodology

10. Salix Finance Update on current HEI & FE activities

11. Salix Finance - working with Higher Education Initial Pilot consisted of 8 Universities: University Cambridge Kings College Leeds Met UWE Edinburgh Glasgow St Andrews Stirling Total Salix Fund £2,079K Total Fund £4,171K Two clients have now increased funding size

12. Salix Finance - working with Higher Education Projects undertaken – March 08 snap shot Commissioned & In Progress Number of HEIs - 8 Number of projects - 93 Total value of projects - £ 1,870K Projected savings Annual financial savings - £ 515K Lifetime Energy Saving - £ 4,389K Annual CO2 saved - 3,417T Total CO2 saved - 29,000T Average payback - 3.63 years Average fund age is only 12 months, all clients are ahead or in line with schedule

13. Salix Finance - working with Higher Education HEI New Phase I clients will be University Durham Exeter Newcastle The Open Portsmouth Sheffield York Aberdeen Abertay Napier Strathclyde Total Salix Fund £2,219K Total Fund £4,438K

14. Salix Finance - working with FE Colleges LSC Salix / LSC Pilot Assessed applications Number of Colleges - 230 Number of projects - 1,248 Total value of projects - £ 22,721K Projected savings Annual financial savings - £ 6,441K Lifetime Energy Saving - £ 49,208K Annual CO2 saved - 47,047 T Lifetime CO2 saved - 359,457 T Average payback - 3.52 years Grant payments to be made in April 08, projects to be completed by September 08

15. Salix Finance HEI activities – new opportunities from April 08

16. SALIX Finance – new HEI opportunities New Salix Funds are now confirmed - DEFRA press release 13th of March 30 Million over three years 10 Million earmarked for HEI (2 years x 5) Intention is that these funds will be used in conjunction with HEFCE Revolving Green Fund – Institutional Fund Time line for 1st round of applications anticipated to be July 08 closing date and September 08 award

17. The HEFCE – SALIX Partnership Two strands to the funding with an annual application process An institutional small projects fund - Size £20M - This will use the traditional Salix model with HEFCE providing the match funding on behalf of the HEI A transformational fund - Size £10M - The purpose is to tackle large projects that will transform the institutions energy consumption and reduce its emissions

18. The Institutional Small Projects Fund HEFCE will match Salix’s funding on behalf of each HEI & fund size will be determined on an individual application basis HEI’s will be required to contribute a minimum of 25% of their fund value but they are encouraged to exceed this and those that do so will be preferred in the selection process HEI’s will be able to use their contribution to fund projects that fall outside Salix’s criteria but still give savings Closing date of Consultation is 21st of April 08

19. The Institutional Small Projects Fund – Assessment Criteria Applications to the fund will be assessed using Salix’s current assessment process. Considering the following The number of ‘ready to go’ projects at the time of the application The presence of energy management expertise and capability to manage the fund The level of financial contribution from the institution

20. Salix Finance Recent improvements to the fund

21. Changes over the last 12 months - New structure Starting in February 07 we brought our client facing activities in- house and set up a team of Client Relationship Managers. The aim was to take a more pro-active approach to working with clients. This has resulted in: More time being spent with clients on-site and in group meetings Improved ‘key point of contact’ communication Support in accelerating project implementation and carbon delivery Better sharing of information and technology Two way feedback helping us to continue to improve the business model

22. Changes over the last 12 months -The application process • To support recruitment of new clients we have appointed a Business Development Manager. We have also worked hard on the application process resulting in: • Hands-on support to explain the Fund and support the application process • A revised application document with only 7 pages. Previously it was 30 pages • A compliance tool complete with supporting technical notes that logs projects and provides both financial and carbon savings in a consistent format • Sharing of approximately 1000 projects showing clients what is working in their sector

23. Changes over the last 12 months - Making the model work for you Making use of the scheme management charge (SMC) For each project undertaken, a client can exercise a right to take up to 15% of the project spend as a scheme management charge which can then be used for the following options: To fund resource to run the Salix programme To support consultancy investigations to establish new Salix projects To pay for investment in M&T To pay for Infrared Thermography technology To help make a new non-compliant project compliant, based on a 20% non-repayable contribution option

24. Salix Finance St Andrews - A Client’s perspective

25. Skills for SustainabilityExeterEffective Energy and Carbon Reduction David Stutchfield Energy OfficerUniversity of St Andrews

26. St Andrews University Overview • Voted Best University in Scotland 2007 (source - Sunday Times UK University Guide table 2007) • 1st place in Scotland People and Planet SD League table 2007 • 6,808 students (UG &PG) • 1,884 staff • £120M annual turnover • 229,792 m2 building stock • 180 buildings from 1410AD

27. Measure your footprint - HECMP ·

28. Utilities Strategy • 4 Utilities Workstreams - Ultimate aim to be carbon neutral for energy • Information and tools (M&T and AMR systems) • Behaviour (Awareness - Interhall Energy Competion, Psychology project) • Investment (Salix) • Renewables

29. Effective use of the advice bodies • Higher Education Carbon Management Program • Partnership Agreement with Carbon Trust – gives access to significant consultancy of Site Surveys for carbon reduction each year. • Energy Reduction in buildings • Renewable Resources • Design Advice on new buildings from Carbon Trust • Green Fleet / Travel Plan Review from Energy Saving Trust • Low Carbon Technologies grants from Energy Saving Trust and Low Carbon Buildings Phase 2 (GSHP, Solar PV & Thermal etc) • Big Splash Water Saving Review from Envirowise • Salix funding for specific projects

30. Effective Use of Salix Fund • Develop program of works based on HECMP or Carbon Trust Site Survey reports • Work out what is the maximum the University can afford to match fund, and what is the maximum number of projects you have time to implement. • With Salix Funding of £524K, and a total of £1,068K to be spent over a two year period, St Andrews has the largest fund value of all the pilot universities.

31. Operation of Salix Fund • Examples of work undertaken • Loft Insulation • Pipe insulation • Window draught sealing • Refrigeration motor controls

32. Utilities – Renewable Energy Solar thermal Wind Geothermal Gas and Biomass CHP

33. Thank You www.st-andrews.ac.uk/environment

34. Salix Finance Questions?

35. 25 Southampton Buildings, London WC2A 1AL t: 020 3043 8800 f: 020 3043 8799 info@salixfinance.co.uk www.salixfinance.co.uk

36. Salix Finance - Maintaining the Fund

37. Salix Finance - Maintaining the Fund

38. Salix Finance - Maintaining the Fund

39. Must reinvest min 60% of annual repayments Salix Finance - Maintaining the Fund