basics:affordability:investing_in_energy_efficiency:economy_and_financing_of_efficiency_new_buildings_renovation_and_step_by_step_retrofit
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basics:affordability:investing_in_energy_efficiency:economy_and_financing_of_efficiency_new_buildings_renovation_and_step_by_step_retrofit [2016/02/17 09:09] – [Risk and return] kdreimane | basics:affordability:investing_in_energy_efficiency:economy_and_financing_of_efficiency_new_buildings_renovation_and_step_by_step_retrofit [2019/03/20 11:08] (current) – cblagojevic | ||
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|//**Figure 2:** Residual values for calculation period of 20 years// | |//**Figure 2:** Residual values for calculation period of 20 years// | ||
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- | • Life cycle of the measures: make sure that revenues (e.g. saved energy’s costs) yielded after the end of the pay back time are not forgotten. Total life cycle results are what counts.\\ | ||
- | • When calculation periods are longer than the life cycle of the measure or the component, replacement | + | * Life cycle of the measures: make sure that revenues (e.g. saved energy’s |
- | • Interest (discount) rates: often the expected rates of return are inadequately high (see next chapter)\\ | ||
- | • Future energy prices and price increase: Assumptions on constant rate of growth may lead to unrealistically high energy prices | + | * When calculation periods are longer than the life cycle of the measure or the component, replacement costs must be considered. However, when they are shorter (which is often the case for buildings), residual values must be regarded at the end of the calculation |
- | • Point in time of the measure: does the measure fit within the normal renewal cycle, or is there a residual depreciation | + | * Interest (discount) rates: often the expected rates of return are inadequately high (see next chapter)\\ |
- | • The starting point of energy efficiency interventions: | + | * Future energy prices and price increase: Assumptions on constant rate of growth may lead to unrealistically high energy prices for long calculation periods.\\ |
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+ | * Point in time of the measure: does the measure fit within the normal renewal cycle, or is there a residual depreciation of the component? In the latter case, the residual value of the basic investment has to be added to the extra energy efficiency investment. This proves that undertaking retrofit based on potential energy savings is not an effective strategy\\ | ||
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+ | * The starting point of energy efficiency interventions: | ||
===== Risk and return ===== | ===== Risk and return ===== | ||
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If energy saving investments are already economically feasible, funding should avoid keeping them expensive. Instead, financial aids should focus on:\\ | If energy saving investments are already economically feasible, funding should avoid keeping them expensive. Instead, financial aids should focus on:\\ | ||
- | • improving liquidity and reducing the financial burden. This can be achieved through direct financial support, but also special credit lines with low interest rates (especially in the first years)\\ | + | * improving liquidity and reducing the financial burden. This can be achieved through direct financial support, but also special credit lines with low interest rates (especially in the first years)\\ |
- | • supporting collaterals to facilitate access to attractive bank credits\\ | + | |
- | • binding financial support to quality assured design to realize the expected performance and guarantee damage-free construction and long lifetime measures\\ | + | * supporting collaterals to facilitate access to attractive bank credits\\ |
- | • achieving very high energy efficiency, because the next renovation will only happen after many years. In this respect, medium quality would hinder the necessary reduction of energy demand and emissions and cause a "lock in" effect.\\ | + | |
- | • An interesting example is offered by the German KfW credits (www.kfw.de). The low interest loans for energy efficient new and retrofit buildings are coupled with direct subsidies, which are higher for better energy efficiency.\\ | + | * binding financial support to quality assured design to realize the expected performance and guarantee damage-free construction and long lifetime measures\\ |
- | • Many German regions provide extra subsidies in support of energy efficiency. For the Hanover region e.g., it could be proved that every Euro granted by the proKlima-Fonds: | + | |
- | • generates a total investment of 16 €, while the additional investment for additional efficiency is only 2 € (but double the value of the incentive)\\ | + | * achieving very high energy efficiency, because the next renovation will only happen after many years. In this respect, medium quality would hinder the necessary reduction of energy demand and emissions and cause a "lock in" effect.\\ |
- | - | + | |
- | - | + | * An interesting example is offered by the German KfW credits (www.kfw.de). The low interest loans for energy efficient new and retrofit buildings are coupled with direct subsidies, which are higher for better energy efficiency.\\ |
+ | |||
+ | * Many German regions provide extra subsidies in support of energy efficiency. For the Hanover region e.g., it could be proved that every Euro granted by the proKlima-Fonds: | ||
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basics/affordability/investing_in_energy_efficiency/economy_and_financing_of_efficiency_new_buildings_renovation_and_step_by_step_retrofit.1455696599.txt.gz · Last modified: 2016/02/17 09:09 by kdreimane