Business Models for Renewable Energy in the Built Environment IEA‐RETD

Citation

Warren, C.M.J. (2013), "Business Models for Renewable Energy in the Built Environment IEA‐RETD", Property Management, Vol. 31 No. 4, pp. 359-360. https://doi.org/10.1108/PM-04-2013-0030

This book is the result of a project initiated and funded by the International Energy Agency (IEA) Implementing Agreement for Renewable Energy Technology Deployment (IEA‐RETD). The project was launched in 2005 with five founding members, but has grown to include Canada, Denmark, France, Germany, Ireland, Japan, the Netherlands, Norway and the UK. The project's aim was to enhance and accelerate the introduction of renewable energy technology. A part of this project identified a need to address the business case for implementation of renewable energy technology into the built environment and resulted in the IEA‐funded project: Business Models for Renewable Energy in the Built Environment (RE‐BIZZ). The steering group and authors of the report were drawn from the participating countries, with Laura Wurtenberger from the Netherlands being the lead contact author.

The book seeks to address many of the barriers to the implementation of renewable energy technologies into buildings, recognising the need to overcome market and social barriers. A key issue is the need to overcome the low, or no, return on investment and potentially high up‐front costs at a time when capital for investment is restrained. The report tackles these issues by presenting an analyses of ten business models in three major categories:

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  product service systems/energy service companies;

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  business models based on new revenue models; and

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  business models based on new financing schemes.

In presenting the ten business models the authors demonstrate the important role which policy makers have to play in facilitating the uptake of renewable energy schemes by building owners and occupiers. Governments can significantly influence renewable energy implementation through legislative means and by providing financial incentives. The business models presented in the book recognises the split incentive that exists between landlords and tenants occupying a building and the need to enable building owners to recoup the additional investment required to implement renewable energy initiatives. In order for this to occur the authors recognise that government intervention may be necessary to change rental legislation rendering rental increases possible, particularly in the residential sector.

The book provides valuable insight for both policy makers and those who invest in the built environment. It presents a series of possible routes to implement new and innovative business models that can stimulate the deployment of renewable energy technologies (RET) and energy efficiency (EE) measures in new and existing buildings. In Chapter Two a thorough analysis of the barriers to implementation of RET in the built environment is provided and Chapter Three follows with the three categories of business model listed above. It also proffers a series of new and innovative business models which might be adopted to overcome some of the implementation barriers.

Chapter Four analyses the business models introduced in the previous chapter and seeks to identify how each model might be able to increase the use of RET and EE initiatives in the built environment. Chapter Five draws together each of the business models and provides a conclusion as to how these strategies might be implemented and Chapter Six is dedicated to articulating recommendations to policy makers and market professionals who can facilitate changes to legislation and alter attitudes to RET investment. The business models are supported and illustrated with reference to 12 case studies contained within the appendices. These case studies are drawn from around the world and include RET/EE initiatives in Manitoba, Melbourne and Berlin among others.

The objective of the project which culminated in the publication of this text was to enhance the uptake of RET/EE initiatives. The report provides a very thorough analysis of the issues and goes some considerable way to demonstrating the financial constraints that need to be overcome in presenting a business case for investment in renewable energy. I regard this book to be essential reading for any building manager or developer with an interest in enhancing their buildings’ sustainability credentials.