Local Authorities
Local authorities have an essential role to play in helping to deliver Government climate change targets as they are uniquely placed to turn national policy into reality and to have a direct interface with the public through the services they provide. They are increasingly recognising the value of managing their own energy use to help reduce running costs and to help protect their communities from the impacts of climate change.
To date, over 100 local authorities including Warwickshire County Council, Bristol City Council and Buckinghamshire County Council have used Salix funding to improve their energy efficiency, boosting their environmental credentials and attaining projected lifetime savings of well over £180 million.
Projects We fund
Projects must deliver both CO2 and revenue benefits and, in line with the Salix objective, must offer long term CO2 savings. For example, a cavity wall insulation project will deliver CO2 savings far more consistently over a very long period compared to discreet user adjustable heating controls which tend to diminish after just a few years. Domestic and transport projects are not covered by the scheme since they are covered by other Government schemes.
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To ensure that the fund is used for projects that deliver long term energy and CO2 savings, all compliant projects must be prioritised on the basis of their capital cost per tonne of CO2 saved on a lifetime basis (£/tCO2LT2).
Projects must comply with the following criteria:
- Maximum 5 year payback period and £100/tCO2 lifetime basis, for energy efficiency projects;
- or Maximum 7.5 year payback period for projects with lifetime £/tCO2 =<£50, for approved energy efficiency and renewable projects.
- Projects must be identified as being additional.
Technologies And Project Types
We appreciate that our model provides real focus for ‘high carbon saving’ projects with the robust rules of 5 year payback and £100/t CO2 LT. However our experience to date confirms that many technologies can fall within these parameters, key examples being:
- BMS – bureau remotely managed
- Boilers – controls & replacement
- Heating – controls, distribution improvements, electric to gas, pipework insulation
- Hot water – point of use heaters
- Insulation - Building Fabric such as cavity wall & loft
- Motor controls – fixed & variable speed
- Office equipment improvements
- Radiator reflective foils
- Swimming pool covers – liquid, manual & motorised
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Where clients express an interest for new technologies to be considered, we are happy to receive material and in some cases pilot projects so that we can evaluate and incorporate them into the fund, recent examples are:
- Office equipment – network PC power management and Blade Server technology
- Voltage reduction equipment
It is also appreciated that some technologies are more difficult to fund within the compliancy rules and here we try and work closely with a client in order to obtain a solution.
- Lighting remains a key area of focus and luckily the technology continues to improve. If lighting is on for long periods of time we have seen good projects, such as car park lighting, which can be funded.
- Another recent success has been an initiative with the ESTA lighting controls group which has resulted in a definition for tamperproof lighting controls. Subject to lighting projects falling within the definition, Salix has increased the lifetime carbon cost threshold allowing specific project compliance.
- Finally we also support a non-refundable 20% client contribution which can help a project become compliant.
As part of the Carbon Trust Impact Assessment system we continue to use Persistence Factors (PFs) to determine technology lifetimes. We pass constructive feedback from clients back to CT to influence future revisions of the Persistence Factors.
Making The Model Work For You
In spending time with our clients we continue to improve the features and options of the fund.
Making Use Of The Administration Fee
For each project undertaken, a client can exercise a right to add up to 15% of the project spend as an administration fee 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
The administration fee has still to be paid for and this is recovered by extending the period/number of repayments made back into the Ring Fenced Fund.
Making Use Of The Annual Repayment %
Another option that can be exercised for each project is making the use of the repayment % and here the client can exercise a right to use up to 25% of the energy savings putting them back into ‘front line services’. These saving can be used to fund non-Salix projects, some examples are given below:
- Cycle shelters
- Water saving projects
- Poster campaigns supporting energy saving / carbon saving initiatives
- Other front line services
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