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structure reduces everyone’s costs below what it costs to put the improvements in over a 20- year period. I’m meeting three universities that want to assess the risk so they can get it credit rated. We think we’ll get a triple A rating, and because we do these programs all over the country we may be able to aggregate the loans and sell enlarged packages, so we can get very good interest rates no one else can compete with. “So the fund should
really energize that whole market and, most importantly, create jobs.” Local administrations
tend to lack contractor management, engineering and
other skills, let alone the amount of capital required to carry out the kind of project Pace laws are designed to enable. This is where Ygrene and the other fund partners come in. Hunter says: “We make agreements with cities and counties in the 26 states where laws have been passed enabling local municipal
In the US, it’s estimated $3tn will fl ow into this sector by 2020, so it has far-reaching ramifi cations for job creation, fi nancial stimulus and reduction of energy use
party validation of the engineering and design of these projects by insuring the guaranteed energy savings. Armbruster says: “The combination of large-scale fi nance and quality assurance is designed to overcome the challenges faced by facilities managers in securing approval for large capital expenditure in such projects, since returns are typically not foreseeable in the timeframes investors demand.”
Slashing costs That is set to change. Hunter says: “The
WWW.CARBONWARROOM.COM
bodies to step up without cost. “We provide the management skills
they lack, arrange the money they don’t have to invest, through Barclays, and provide interested asset owners access to best-in-breed engineering skills through our alliance with Lockheed Martin, all while ensuring the construction work creates jobs for locals. “Energi guarantees savings for
commercial buildings so owners know if they spend money on the retrofi t they will increase profi ts for their business. “By bringing all these parties together
in a coherent manner so the job is done at least cost, we’re trying to renovate America so we can reduce our carbon footprint and secure our energy dependence.”
The War Room in action The fund is proof positive of the value of Carbon War Room’s practical, hands-on approach and shows there is room for another organization campaigning on carbon emissions. From the outset, Richard Branson and the other founders of the War Room were adamant CWR would utilize their entrepreneurial vision – and heavyweight contacts – to achieve concrete results. Armbruster says: “The Pace Commercial Consortium fi nancing mechanism represents the missing piece in the jigsaw puzzle for many cities trying to implement green plans. We’ve been working to solve the puzzle for over 18 months as part of our Green Capital Global Challenge operations. I believe this groundbreaking mechanism will unlock a $1tn market for green retrofi ts, creating jobs and growth globally.” The fund is already talking to the administrations of the major population centres in Florida, Hunter’s home state of California, Chicago and Detroit – where car manufacturers are big energy users – as well as Washington DC. Sporting the competitive advantage of being the only provider of energy effi ciency retrofi ts in the US with access to “pretty much unlimited” capital through the asset-backed bond market, the fund aims to expand operations into every state where Pace legislation is in place as quickly as possible. Red tape is the only thing slowing it
down. “Unfortunately, politics being what it is in America, moving fast means six months to a year, as the process is slowed just going through all the administration that has to be done to get a city or county signed up,” Hunter says. But conquering the US isn’t the Carbon War Room’s only goal. A team is to visit China with a view to setting up a similar program, and Australia is another target. Hunter says: “We think it’s potentially a game changer worldwide.” ||||
ISSUE 04. SEPTEMBER 2011
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