SDCL and BRE work together on Green Investment Bank backed fund.

Fund manager Sustainable Development Capital (SDCL) has launched a £100 million fund to back energy efficiency retrofits of UK non-domestic buildings. The fund manager is working with BRE on the initiative, with the latter providing monitoring and verification to minimise investor risk and maximise benefit for the building owner.

The UK Energy Efficiency Investments Fund has £50 million of cornerstone commitment from the government’s Green Investment Bank (GIB). The fund will support projects that deliver reduction in energy demand, cost and greenhouse gas emissions for four areas:

- Building retrofits, including LED lighting; heating ventilation and air conditioning; voltage optimisation; and chillers and pumps in commercial buildings and industrial facilities
- Renewable heat, including installations of biomass boilers in hospitals, leisure centres and manufacturing facilities.
- Combined heat and power (CHP) in hospitals, universities and perhaps even whole districts
- Urban infrastructure, including heat networks, street lighting and measures to cut energy use in car parks and airports.

The fund is open to projects of £2 million plus and provides backing for up to 100% of project cost, in equity or equity-like investments. The return on investment will come from a proportion of the savings in energy bills. It is typically looking for projects with a three year to five year payback period. Projects will be expected to offer an average annualised reduction in greenhouse gas emissions of at least 1 tonne of CO2 for each £2,000 to £3,000 invested.

Speaking at the fund launch, Rufus Logan, director of BRE Scotland said that BRE’s role would be to provide strategic and technical support: “We are not here to replace project teams. We will provide the hard evidence to help in assessing the risks, delivering performance and ensuring that projects get the recognition they deserve, through standards like BREEAM”.

Jonathan Maxwell, founding partner and chief executive of SDCL said, “As a fund we have significant capital to invest in the UK. If you have a project that is ready, we would be happy to look at how we can help.”