justifying investment
£51.5 million scheme should
provide bridge financial
support which allows
energy saving projects to
proceed immediately.
for completion within a single financial “It is only necessary to look round the
year, there is normally sufficient cash establishment to see whether timer
available. In terms of a County Council’s switches, for example, are working cor-
total revenues, for example, even a rectly or need to be replaced. Or that
£200,000 project could be covered. Fi- there are no controls which can isolate
nance officers across the public sector parts of a building to reduce energy us-
accept the bona fides of the commitment age when it is not occupied.”
letter and are happy to commit resources Having eliminated the obvious sources
against it. of energy loss, it is probably a good strat-
“The only potential problem might egy for energy managers to start moni-
arise when the project starts in one fi- toring consumption in a more structured
nancial year and is not completed until manner. The installation of half hour
the next. We are aware of that situation UK’s first ever comprehensive low car- meters in organisations which do not
and are prepared to make stage pay- bon transition plan to 2020. already have them, is one possibility but
ments in what will no doubt be excep- In numerical terms, the plan aims to the cost appears rarely to be justified by
tional circumstances.” deliver an 18% reduction in carbon emis- the benefits.
A test for the success of the new Salix- sions by that time (compared with 2008),
managed scheme is the number and or a one third reduction on 1990 levels).
quality of applications. “By the end of To emphasise the significance of the
Questionable benefits
August, we had received applications for Plan, the statement from DECC was sup- As we have considered in the examina-
325 projects with a total value of approxi- ported by parallel publications on the tion of the CRC, increasing the proportion
mately £13.5 millions. same day addressing energy saving in of such meters within a CRC participant
“Many were from schools and col- the private business sector (from the could lead to a notional improvement in
leges, which suggests that we had taken Department for Business Innovation and its league table position, but the perceived
the correct approach by setting a first Skills) and transport (from the Depart- benefits would almost certainly be over-
closing date. applications which meet ment for Transport). taken by the costs.
the criteria for the scheme will receive With the final format of the Carbon Re- Salix is understandably cautious
a formal offer at the same time. This al- duction Commitment scheduled for pub- about funding investment in half hour
lows the successful candidates to press lication around November 2009, activ- meters. “As a general rule, we do not fi-
on with their projects.” ity – or at least talk about activity – has nance their purchase but we would al-
He noted that this tight turnround of never been more intense. How far can low organisations to add them into the
applications, combined with the first Salix Finance use its unique role in fund- total cost of a qualifying project.”
deadline being set for 17 July, enabled ing public sector carbon reduction Organisations may be happy to spend
many of the successful schools and projects to persuade those responsible money on carbon initiatives which have
colnew scheme is around £44,000, com- for energy management that they should ‘photogenic’ outcomes such as highly
pared with £12,000. be using SEELS money to invest in en- visible wind turbines (which Salix can-
ergy-saving projects? not normally fund because the payback
Scheme set in context
Keir is keen to avoid the installation is outside the limits of its schemes), but
of energy-saving kit where it is not the same management is somewhat reti-
Impressive though the size of the SEELS needed. A school, for example, might be cent about committing even a tenth of
fund might appear, the scheme should better off spending time looking for ways the same amount on replacing a 12 cm
not be seen in isolation from other UK in which energy is being lost, and plug- control box on the inside wall of its plant
government initiatives. ging those gaps in its infrastructure be- room.
In July 2009, for example, DECC pub- fore investing in replacement boilers. As the Salix CEO noted, “Salix is there
lished its UK Low Carbon Transition Plan. Checking whether the existing controls to finance the boring projects – which
Subtitled ‘National strategy for climate have been set correctly to reflect the or- just happen to be the ones which can
and energy’, the White Paper established ganisation’s real need for power, is one way save the largest amount of energy con-
what the Department described as the of reducing energy consumption. sumption, of CO
2,
and costs, of course.” §
The Informed Executive
19
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