التصحيحات

- Do the preliminary study allowed you to identify precisely the jessicables projects?

- Did you complete the preliminary study by other studies / analyzes?

In many cases, studies were done in 2008, with ex ante studies with specific questions; no guide lines for ex ante studies, assumption that need a new study based on existing studies.

Studies are partly paid by the EIB, the region request the study formely to the commission, and if approuval EIB launches the tender for selecting the consultant who has on the ground knowledge and EIB completes the data with one info.

Don’t know how many studies can be launched by the end of the programation; responsibility for the local authority to order and pay for the ex ante evaluation.

Template can be set up next year.

- How does GLA direct the process?

Who take decisions on which projects to support (the governance scheme)?

The decisions on which projects to support are taken by the udf manager, the GLA set the investment policy, the udf set project which fit the criteria.

We have two key relationships: funding agreement delegated authority to the investment board, take decision on the UDF, and appoint most of the members sitting on the board.

- How does the Governance and decision-making process work ?

- Why choose to have a “green fund” umbrella, couldn't the UDF be run on its own?

Depends on the size of the fund, and the fact that money can be transferred from one fund to the other according to the performance of the funds.

Restricted thematics, with different level of risks, with investors having the same interest and risk profile and fund manager with specific expertise.

Average funds is 80 millions, smallest is 20 millions euros (exception), the biggest 260 millions euros.

- Which criteria in the choice of the projects : energetic performance ?

Geographical priorities?

(list of criteria) Energetic and urban funds are going to be off the shelves type of projects for the next programmation.

Other projects can be set up as well: starting of broad types of projects and decline the different criteria according to the needs.

Geographical priorities: focus on areas but not compulsory; depends at what level you set up the fund: national programmes will focus on specific areas, with geographical obligations - Which types of projects have been funded?

Investments or operating costs?

Operating funds can’t be funded with JESSICA.

- Mostly housing?

Private or public?

Energy efficiency improvement in existing housing only (EU regulation).

Housing: Exclusively public from French perspective.

No restriction from the EU level, restriction on national level.

- Are the beneficiaries of the EEUDF the retrofitted operation or some intermediary bodies such as ESCO?

Slightly complicated model, possible in France with third part investors.

ELENA: technical assistance funding whereas JESSICA is financial mechanisms.

GLA have two ELENA contracts.

- AMBER manages the UDF : what kind of a organisation is it?

Is / could AMBER also be a beneficiary?

AMBER is private sector fund manager like FORESIGHT.

EIB invest in private sector investment manager: most big banks in France, other private sector non banks: Meridian primarily to invest in PPPs.

Banks can be compelled to achieve certain types of objectives that are not financial but economic development.

Average management fee for the Holding fund: 1% per annum, depending on the size of the fund.

The UDF is 2 to 3%.

Need to know what the market is.

- How to launch the procurement contract ?

EIB can be selected without tender as a EU institution owned by state members.

In certain countries, regional banks like the landers in germany; in France: CDC is discussing the issue.

Appel d’offre is not fitting the definition of public procurement: either the local authority does the procurement on its own following national regulation or the EIB does it on its behalf following the EU regulation.

- Could a local authority add up the different way of getting the financing (guarantees, loans and grants)?

Combine the different sources of funding: now not possible, UDF can only invest in projects, loans, guarantee or equity.

No grants allowed for now.

Next programmation: might be possible.

ADEME: can be cofunding JESSICA fund, the same for all kind of public fund?

Depends on national regulation, not forbidden by the EU.

The cofunding to ERDF will be feasible at project level and will not be necessarily at UDF level.

Land and buildings should be “mobilisable”.

- Which is the range of the internal profitability rate’s (TRI) for the project?

The financial return expectation for the green fund social housing UDF is expected to be lower than other two: 3% per annum Hurdle rate (minimum rate) and incentive to go further.

The interest is meant to cover the management cost of the fund.

- How to evaluate the profitability of projects (market study) ?

The task of the UDF manager.

Profitability is to be evaluated according to targets set up.

- According to you is-it necessary to require a minimum level of profitability?

The Focus in France was to identify grey areas with lower profitability, or not already identified profitable market.

- How do you have calculated the risk for loans ?

The UDF manager job is to assess the risk and present it to the board; risk framework can be created by the EIB, taking into account the fact that it has economic development concern.

More risk is usually allowed.

- How do you manage to attract private finance in energy efficiency UDF ?

Professional fund manager, with good communication skills and network; sometimes bring a bank; cofinancing can be specific to certain sector.

Debt fund is easier to go along with for banks, opposite to equity investment.

Trade off with wanting to do economic grey zone project and having investors.

Investors invest at project level.

- Have you had an educational activity on these financial tools including the principle of subsidies payback ?

How did you organize the necessary knowledge on financial engineering in your team? Training?

Recruitment of specialists?

Communication tools ?

Different levels: project level: primary responsibility is the manager’s; at the udf level: EIB have directly talked to people, + various communication events; political coverage.

Each procurement generate a communication event; once the fund manager is in place: he/she is in charge of promoting (official or informql - How much time is needed between ordering a preliminary study and the implementation of the JESSICA Programme?

The timetable for the green fund: evaluation completed in sept 2008, HF in march 2009, march 2011, it took less time to the northern fund because it had the template.

Depends on what we consider as being the preliminary study and how far we go in details.

In six month, can have a study and xxx, State aid: address this issue as soon as possible, which is going to depend on what is planned to be done, activities undertaken, schemes on which can lay the fund.

See if the project fits state schemes.

The JESSICA scheme has to be written in the OP: negociations with the commission: priority to infrastructure(Greater London) or business support (EU)?

- What is the appropriate territorial and financial size to create such a fund?

On the current programme, driven by the OP; specific money cannot go outside unless specific other funds.

One can decide if want to go on another perimeter: see northern fund: result of political decision.

- Advantages / disadvantages to use a holding fund ?

The ex ante will help decide if the HF is needed.

Flexibility of transferring funds from one UDF to another?

Looking at the future, depends where want the funds to go - What are the rate duration (average and maximum terms)?

And the grace period ?

Green Fund have left it up to the Fund manager to decide: the project doesn’t have to be completed by the end of the OP period.

The project has to be paid before the end of the OP.

The project runs on on a longer period, and so does the repayment of the loan.

Need to reinvest the funds into the similar sector of activities, whatever the form (grant or financial tool).

Grace period is left up to the fund manager decision.

Only specific feature: the type of project - Repayments of borrowed funds can they spread beyond the programming period?

- How did you manage to secure the State Aid issue?

How difficult was it?

The approval for the scheme was very difficult, very slow process.

Needed to create something new.

The aid is tasted at different levels: HF, UDF, project level.

Negotiation on the risk taking.

Decided to set up scheme the same way private sector would do.

Investment of the state aid was done on the same terms and conditions as the private sector not to distorts the market.

- How is JESSICA perceived by projects holders?

Three investments done by GLF: the project holders quite liked the fact that it is ethical funding; not happy about all the rules but good return on image; - Have you considered solutions in cases of non-profitable project?

If yes, which ones?

- What types of difficulties the London Green fund is facing?

The kick issue at the moment is to find enough projects by 2015.

Takes very long time to get investments identified.

Starting to look at the strategy to reallocate funding.

Main concern is how to spend all of it?

Find good projects is the hardest part.

- Same question for its partners? HF manager ? UDF manager ?

Key concern: for the waste: very interesting project but take a very/too long time to get financed.

Looking to widening the scope of projects in order to ease the spending of the fund.

- Does it create innovative partnerships ?

Partnership is quite lose with GLA; working relationship with EIB has been the main high point.

They also are investors, not only managers.

For the third UDF: scenario where two to three hundred million will be invested in the Greater London: successful return on investment of the JESSICA fund.

In Italy, immature market so great impact in creating new partnerships.

- Which was the hardest part in the setting up and of the JESSICA fund?

Sorting out the match funding, had to use land, got complicated and managed to go back to cash: needed to get approval from the government was very long, no previous template.

EIB: also the fact that it is a pioneer initiative.

Difficult with admin to make them understand that it is not the same rules that apply to the administration and the Jessica fund.

Change in mentalities.

- What are the mistakes to avoid?

The major point is not to misunderstand the strategic size of the fund.

Find projects that are fit to JESSICA.

Find a way to be as much flexible as possible.

As far as procurements are concerned: not too many binding rules.

For the SME fund: procure a framework, enabling to change fund managers - What kind of advice would you give to JESSICA beginners?

Start of thinking what we want to do, bottom up approach.

We know what the eleven priorities are, start looking at does it mean on the ground.

Explore potential fund managers.

Use them to start shaping the project.

Communication strategy: despite huge efforts to pass the message on the JESSICA fund: further need to explain because of the little knowledge of the financial tools.

Look for political support, because it’s not a priority in elected officials agenda.

SME fund: 6 millions.

Used the money returned from investment from previous ERDF; the fund manager is obliged to secure at least 10 million; which means cofinancing, and the idea of setting up leverage by the private sector in the sector of activities the GLA wants.