Clients: City of Tartu, Ayuntamiento de Pamplona, Stad Genk, VITO, Flux50, BPIE + 26 others
Date: 2023 – 2027
Location(s): Estonia, Spain, Belgium
Bax is supporting the cities of Tartu, Pamplona, and Genk to deliver three of Europe’s first Positive Energy Neighbourhoods (PENs). Contributing to a “living lab” approach which integrates local partners’ state of the art energy technologies, engagement solutions, and business models, Bax is exploring how innovative public-private financing instruments can enable viable investment models for scaling PENs across Europe.
European cities increasingly need resilient and affordable local energy and building systems which reduce overall energy demand whilst producing a surplus of locally generated clean energy for citizens. Despite their technological maturity, the commercial integration and viability of these systems is less well developed. New business models and financing options must be developed to ensure PENs deliver energy for socially disadvantaged households while also attracting investors across the public, private, and citizen-led sectors.
Approach
Bax’s Energy team helped partners to secure the original funding for the living lab concept through Horizon 2020, proposing a competitive consortium to help advance the state-of-the-art on neighbourhood-level energy systems. Within the consortium, Bax is conducting market assessments, cashflow modelling, expert engagement, and event coordination to identify, compare, and build a PEN investment strategy at city level. This combines more conventional vehicles of debt, equity, bonds, and crowdfunding with more novel instruments such as ESCOs, public guarantees, PACE financing, and ESG finance to reduce upfront costs and spread payback over longer than usual timelines.
Impact
Bax is supporting PEN development in diverse contexts across all three living lab cities. Pamplona is establishing a PEN within a multi-user commercial estate as well as a social housing development for low-income residents Tartu is renovating multiple 9-floor apartment buildings and Genk is taking a more distributed approach, connecting 30 individual houses through a suburban PEN model.
We increasingly see that cities, companies, and governments are trying to build viable investment models to scale local clean energy systems out of the pilot scale, often using strategies which combine public support with private investment. The cities of Tartu, Genk, and Pamplona within oPEN Lab, are flagship sites towards this goal, working with their local technology providers to bridge the PEN ambition with realistic models that are scalable and beneficial for all.
– Dominic Stephen, Energy Innovation Consultant
