|Financing Solution Name||Lease-Purchase/Equipment Finance|
|Financing Solution Description||Leasing enables a building owner to use a energy efficiency installation without having to buy it. The installation is owned or invested in by another party, usually a financial institution such as a bank. The building owner pays a periodic lease payment to that party. Leasing is a well established method of financing energy efficiency projects. While the term is virtually interchangeable with equipment finance, the contracts typically cover all materials, labour and soft costs associated with an energy efficiency project. The customer either arranges lease financing through the manufacturer, vendor, or installer of the energy equipment being purchased or, if unavailable, directly with a third-party lessor. The customer and lessor sign a lease agreement once the project terms are agreed upon, and the lessor then provides the capital to purchase the equipment and associated installation services from a contractor. Once installation is complete, the customer begins making regular (typically monthly) fixed payments to the lessor on an agreed-upon schedule. However a critical distinguishing feature of equipment leasing is that the equipment is the collateral for the financing. The possibility that an equipment finance lender would repossess the equipment for non-payment puts the lender in a strong position but in practice it may be difficult to remove energy efficiency equipment that is embedded into a building or process.|
|Financing Solution Reference||https://oneplace.fbk.eu/financing-energy-efficiency/financing-energy-efficiency/transnational-methodological-framework/financing-models-for-energy-efficiency/leasing/|
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Frequently Asked Questions
We have fund our selves at a crossroads. Buildings energy efficiency is not moving fast enough to meet the Paris Agreement goals. Innovative financial instruments, business models and regulatory frameworks are urgently needed.
We can continue in this direction. Or we can explore a new way forward. The encyclopenergy aims to do just that in a bid to streamline and optimise the way the built environment community shares knowledge.
The enclyponergy aims at creating a comprehensive compendium to support the spread and scale of innovation in financing solutions, business models, and regulatory frameworks to accelerate the transition to a less carbon-intensive built environment.
The project ‘Climate Positive Circular Communities’, short name ARV, is funded by the European Green Deal initiative as an Innovation Action within the Horizon 2020 Framework Programme. The enclycopenergy is a flower germinating from the ARV in order to map the world state of art when it comes to energy efficiency financing, business models and regulatory frameworks. The Green Digital Finance Alliance as an ARV Consortium partner is in the lead of such an effort.
The Encyclopenergy is a crowd-open-sourced encyclopedia of energy efficiency enablers. It is a crowdsourced global catalogue of financing tools, business models, and regulatory frameworks enabling, empowering, and scaling energy efficient solutions for the built environment. It also offers intelligence to list demonstrations and organization working in the field with the hope this will be a boomerang to boost the renovation wave.
Everywhere. Ubiquitus. Onlline. And in your pocket. The encyclopenergy wants to be a practical tool available to all at all time. You can surf it, download it and populate it from anywhere.
The encyclopenergy is still in its infancy. It was kickstarted on March 1st 2022. Help this living knowledge hub to grow, refine and ameliorate so that it can graduate into a useful tool for a climate positive built environment.
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Information in this encyclopedia serves for informational purposes only. The information has been crowed-collected from the global community willing to share their knowledge on energy efficiency enablers. Input has been approved by the Green Digital Finance Alliance (GDFA) team by a validation process via desk research following a transparent approach. However, GDFA does make any express or implied warranty or representation concerning the completeness or correctness of information provided. Therefore, GDFA hereby disclaim any liability for any loss or damage resulting from use of information in this encyclopedia or reliance or decisions based upon the information or outcomes of this database.
Information in this encyclopedia serves for informational purposes only. The information has been crowed-collected from sources believed to be reliable, and input has been approved by the Green Digital Finance Alliance (GDFA) team by a validation process via desk research following a transparent approach. However, GDFA does make any express or implied warranty or representation concerning the completeness or correctness of information provided. Therefore, GDFA hereby disclaim any liability for any loss or damage resulting from use of information in this encyclopedia or reliance or decisions based upon the information or outcomes of this database.Each user and/or third parties are advised that they are responsible for reliance on the database, data, information, findings and opinions provided by GDFA.
Any reference to a specific data source, information or service by trade name, trademark, manufacturer, or otherwise, does not constitute or imply an endorsement, recommendation, or favouring by GDFA.
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This project has received fundings from the European Union’s Horizon 2020 research and innovation programme under agreement No 101036723