Lithuanian local authorities explored innovative financing models at CITYnvest seminar in Vilnius

On the 17th of May 2016, representatives of local authorities, financial institutions, academia, housing associations and policy makers from local and regional level gathered in Vilnius to explore the innovative financing instruments for energy retrofits in the municipal building stock. The event was co-organised by CITYnvest and the Association of Local Authorities in Lithuania.

The local authorities in Lithuania recognize the necessity of renovating existing buildings on their territory. However, while financing programmes for the residential and governmental buildings retrofits have already been implemented with the support of the national government, financing for renovations of the municipal stock is still being developed. Thus, the participants of the event were very eager to learn more about good practices from Rotterdam and Berlin.

It seems like in Lithuania, there is a special interest in exploring ESCO model. However, there were only a few attempts of implementing Energy Performance Contracts and the local authorities do not have sufficient expertise. The funding may also be an issue, as ESCO financing increases the public debt. Yet, Lieven Vanstraelen from CITYnvest stressed that ESCO is rather an operational than financial model thus it can be combined with other sources of money, such as grants, own funds or loans.  On the other hand, Ard den Outer from the Rotterdam Green Buildings project advised to combine renovations with maintenance contracts in case of using ESCO model, which would allow more efficient budget planning.

It is difficult for an individual municipality to be a pioneer, says Lieven Vanstraelen. If you don’t have a level of size, you need to have the level of aggregation. That is what happened in the Liège region. GRELiège, an organisation responsible for stimulating economic growth in the region has set up a department within this existing organisation. This department, called RenoWatt developed a one-stop-shop, which provides assistance to municipalities in energy efficiency renovations in buildings. RenoWatt is bundling the projects, which allows to reach a profitable size of investments.”

The panellists stressed that someone needs to take the initiative and start a pilot project, which would allow to build up expertise in innovative models in Lithuania. In order to do so, a political commitment and a clear definition of a level of ambition and a target audience are necessary. Thus regular meetings of all stakeholders, which would allow to achieve common understanding, can be a good starting point for the development of innovative financing models in Lithuania.

All presentations and pictures from the event are available on the page of the event.