Government to invest €35m in energy fund

The Government is to invest €35m as seed capital in a new energy efficiency fund (EEF) it hopes will help finance start-up projects in the energy efficiency sector.

It will also spend another €9m improving the energy efficiency of Government buildings in the next three years.

The EEF is being created with the private sector and it’s hoped it will eventually be worth €70m.

The fund was created, according to Energy Minister Pat Rabbitte as a “mechanism to allow the financing of competitive proposals for energy efficiency projects”.

“Overcoming the financing hurdle is the single greatest barrier to economic activity at present. We know there is a pipeline of exciting and innovative projects out there, we just need to unlock these barriers,” Mr Rabbitte has said.

The Government wants to create an innovation environment that will attract investors to build a far bigger fund, one that will be big enough to realise the multi-billion euro worth of economic activity that they believe retrofitting and energy efficiency projects could be worth.

Under the Government’s national energy efficiency action plan, it has set out measures to make savings of 20% in Ireland’s energy output. Retrofitting of buildings in the private and public sector is a central plank of this blueprint.

Last night, Friends of the Earth welcomed Mr Howlin’s re-iteration of the Government target of retrofitting 100,000 houses every year from now to 2020.

“But the €35m in support funds announced today is far too little. There is real uncertainty over the future of the popular SEAI grant schemes and uncertainty about when the new “pay-as-you-save” scheme will be up and running. This makes it likely that retrofitting will stall in 2013 rather than take off. Moreover, the new property tax will act a real disincentive as the investment required for retrofitting will push your house into a higher tax bracket,” he said.

Public Expenditure Minister Brendan Howlin said the new energy efficiency fund would put retrofitting projects on a more sustainable footing.

“Good progress has been made on exploring private funding participants’ interest, but as a sign of the Government’s intent I have agreed to provide resources of €35m as seed capital for this fund, with a view to establishing a leveraged fund of over €70m,” he said. Mr Rabbitte will announce further details in due course.