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"With a five year payback, transferring the risk from the public purse to the private provider of the work, it has made both environmental and financial sense."


National rollout of London's retrofit scheme to help councils cut emissions

The Guardian

David Rees

7 February 2013

In November 2012 the Department for Energy and Climate Change (DECC) announced it would fund a nationwide rollout of RE:FIT, The Mayor of London’s programme to improve energy efficiency in the public sector.

The scheme works by helping public organisations retrofit their buildings with energy-saving technology that did not exist when they were first built such as combined heat and power, photovoltaic solar panels, low-energy lighting and more efficient boilers.

The mayor's programme, first launched in 2008, was revised earlier this month to incorporate the lessons learned from the work carried out so far. The changes include making the scheme more flexible and simpler, as well as extending the range of funding options available.

To date, 63 public sector organisations across London have signed up to participate and a number have already seen real benefits. Ealing council's £1.1m scheme took 10 months to complete, has found a 29% per annum saving on the local authority's energy bills. It has also cut the council's CO₂ emissions by 1,000 tonnes a year. With a five year payback, transferring the risk from the public purse to the private provider of the work, it has made both environmental and financial sense.

When the current programme has been completed in 2015 it will have had a significant impact on the capital city. The current pipeline of projects will have created more than 1,000 jobs and CO₂ emissions will have been reduced by nearly 47,000 tonnes a year – the equivalent to 5,402 flights from London to Paris. Nearly 1.7m sq metres of public property will have been retrofitted, space which could be stretched across 250 football pitches, finding energy cost savings of nearly £9.7m.

As this scheme is rolled out across the country, there more options for councils who are interested in retrofitting their own estates to save money on energy bills. These range from allowing fully financed projects which do not require upfront investment from the authority, to potential benefits from a tax and accounting treatment of any investment, such as off balance sheet investment. Simpler tendering processes through a pre-agreed model will also make smaller projects (costing less that £1m) much more viable.

Now it will be available outside the capital, the RE:FIT scheme is likely to provide a workable option for owners of older buildings to reduce energy consumption and CO₂ emissions. Other energy saving schemes often offer only theoretical benefits, involve hidden costs and be very complicated to develop and oversee with no guarantee of success.

In contrast, I'd argue that RE:FIT has been proved in practice within London, and this should mean that it will prove more attractive elsewhere and make a real difference to the national challenge of reducing emissions.

David Rees leads PA's local government services

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