1. Bank aus Verantwortung How does energy efficiency work in Germany? Berlin, 16 June 2014 Jürgen Daamen

2. 2 KfW survey: Barriers to energy efficiency investments in the corporate sector › Lack of capital or capital already tied up for different purposes › Lack of time / staff to identify / implement saving potentials › Long amortisation periods › Lack of knowledge (also on efficiency potential) › Energy costs do not pose a sufficient incentive How does energy efficiency work in Germany? / Berlin / 16 June 2014

3. 3 How does energy efficiency work in Germany? Factors of success › Associate highly reliable partners › Have simple terms and conditions › Introduce consistent standards › Offer attractive conditions and good services

4. Established:1948 Shareholder: 80 % Federal Republic of Germany, 20 % federal states Rating:AAA / Aaa Headquarters:Frankfurt am Main Branches:Berlin, Bonn Promotional volume 2013:72.5 bn Euro KfW is a government bank with a key role in the German Energy Turnaround 4How does energy efficiency work in Germany? / Berlin / 16 June 2014

5. 5 Highly reliable partners are substantial to achieve the common aim: support SMEs economically KfW Banks Chambers Experts Ministries

6. 6How does energy efficiency work in Germany? / Berlin / 16 June 2014 How does energy efficiency work in Germany? Factors of success › Associate highly reliable partners › Have simple terms and conditions › Introduce consistent standards › Offer attractive conditions and good services

7. 7How does energy efficiency work in Germany? / Berlin / 16 June 2014 Terms and conditions are mainly set by the financing partner: on-lending system for loans application before investment financing partner enterprise credit rating and fixing of securities by the financing partner loan agreement and disbursement KfW refinances the loan energy expert regional partner (chambers) contract service

8. Risk-adequate interest rate system allows risk-adequate margin for the financing partner KfW gives specifications financing partner assesses the risk risk-adjusted interest rate (  9 price categories) evaluation of client‘s financial standing (  solvency category) evaluation of collaterals (  collateral category) 8How does energy efficiency work in Germany? / Berlin / 16 June 2014

9. 9 The regional partner guides the way to grants for energy efficiency advice enterprise regional partner (chambers) energy expert 12 3 4 application online confirmation commitment and disbursement contract How does energy efficiency work in Germany? / Berlin / 16 June 2014

10. 10How does energy efficiency work in Germany? / Berlin / 16 June 2014 How does energy efficiency work in Germany? Factors of success › Associate highly reliable partners › Have simple terms and conditions › Introduce consistent standards › Offer attractive conditions and good services

11. Introduce consistent standards KfW Energy Efficiency Programme: Technical requirements 20 % energy saving 11How does energy efficiency work in Germany? / Berlin / 16 June 2014 *confirmed by an energy expert *

12. 12How does energy efficiency work in Germany? / Berlin / 16 June 2014 Introduce consistent standards as much as possible What is our benchmark? 1. Investment measures with substantial energy saving effects › Confirmation by an independent energy expert 2. Refurbishment and new construction of commercial buildings

13. 13How does energy efficiency work in Germany? / Berlin / 16 June 2014 20 % energy saving compared to the last 3 years 15 % energy saving compared to the industry average Introduce consistent standards as much as possible 1. Investment measures with substantial energy saving effects replacement investment new investment › Confirmation by an independent energy expert required on application benchmark measure

14. 14How does energy efficiency work in Germany? / Berlin / 16 June 2014 Consistent energy standards 2. Refurbishment and new construction of commercial buildings Benchmark is the efficiency standard of a new building according to the German building code (energy conservation ordinance). transmission heat loss primary energy demand per sqm

15. 15How does energy efficiency work in Germany? / Berlin / 16 June 2014 Energy Conservation Ordinance + 0 % for primary energy + 20 % for transmission heat loss refurbishment › Confirmation by an independent energy expert required on application benchmark measure Consistent energy standards 2. Refurbishment and new construction of commercial buildings Energy Conservation Ordinance - 20 % for primary energy + 0 % for transmission heat loss construction

16. 1. investment measures › acknowledged and listed at https://kfw.beraterboerse.de: › graduate engineer › additional training in energy consulting › 3 years experience in energy consulting › independant from purchase order › legally acknowledged according to energy conservation ordinance 2. refurbishment or construction of commercial buildings: 16How does energy efficiency work in Germany? / Berlin / 16 June 2014 Consistent energy standards have to be confirmed Qualities of the energy experts

17. 17How does energy efficiency work in Germany? / Berlin / 16 June 2014 How does energy efficiency work in Germany? Factors of success › Associate highly reliable partners › Have simple terms and conditions › Introduce consistent standards › Offer attractive conditions and good services

18. KfW Energy Efficiency Programme Attractive Conditions even for big Companies Eligible applicants:private enterprises up to EUR 4 bn turnover Maximum amount:usually up to EUR 25 m Term:5, 10 or 20 years Fixed interest period:5, 10 or 20 years Repayment-free start-up phase:from 1 up to 3 years Guarantees:as customary in banking Commitment fee:1 month free, then 0.25 % p. m. Unscheduled repayment:against early repayment penalty only Combination: with other funding within the EU aid limits from 1.00 % eff. * * as of 16.06.2014 18How does energy efficiency work in Germany? / Berlin / 16 June 2014

19. 19 SME Energy Efficiency Advice For whom? › Small and medium-sized enterprises › Located in Germany › With annual energy costs of more than EUR 5,000 How does energy efficiency work in Germany? / Berlin / 16 June 2014

20. 20 1. Initial advice by an independent energy expert SME Energy Efficiency Advice For what? › aim: determine the energy saving potential › grant of up to 80 % (not more than EUR 1,280) 2. Detailed advice by an independent energy expert › aim: drawing up a detailed energy concept including economic assessment › grant of up to 60 % (not more than EUR 4,800) Application with regional partner (e. g. Chambers of Commerce and Industry) How does energy efficiency work in Germany? / Berlin / 16 June 2014

21. 21 SME Energy Efficiency Advice Procedure 1. Choose regional partner (www.rp-suche.de) 2. Fill in online application 3. Choose energy expert (www.kfw-beraterboerse.de) 4. Conclude advisory contract 5. Initial / Detailed advice 6. Submit advice report and invoice 7. Receive grant How does energy efficiency work in Germany? / Berlin / 16 June 2014

22. 22 SME Energy Efficiency Advice Final reports are standardised Final report initial advice › Description of initial situation › Description of deficiencies › Recommendation of measures Final report detailed advice › Amount and costs of energy consumption › Evaluation of status quo › Deficiencies and savings potential › Priorities of efficient energy usage › Recommendation of measures › Recommendation for use of renewable energies › Specific recommendation of savings measures › Advice concerning support programmes How does energy efficiency work in Germany? / Berlin / 16 June 2014

23. 23How does energy efficiency work in Germany? / Berlin / 16 June 2014 KfW Energy Efficiency Programme Example print shop Old established family print shop: Replacement of an old printer by a new semiautomatic one (replacement investment) Requirement KfW-Energy Efficiency Programme: 20 % energy saving compared to the last 3 years Environmental effect calculated by an energy expert: - reduction of electricity consumption from 6,580 kWh to 2,397 kWh p. a. is equivalent to 64 % saving Investment EUR 41.000 fully financed for 5 years - monthly instalment of EUR 726.04 (price class B, 1.26 %) of which are EUR 683,33 redemption

24. 24 KfW-Energy Efficiency Programme Example: auto repair shop modernised its company The entrepreneur made use of the energy advice for SME by an energy expert. He decided to perform the following measures: › exchange heating boiler › installation of a thermal power station › renewal of windows and garage gates › installation of measurement, control and regulation technology for each room › integration of an air compression with heat recovery for warm water › The energy expert calculated an energy reduction of 196,140 kWh/a (21 %). › The investments of 430,000 Euro were financed completely in the KfW-Energy Efficiency Programme. How does energy efficiency work in Germany? / Berlin / 16 June 2014

25. 25 How does energy efficiency work in Germany? / Berlin / 16 June 2014 Does energy efficiency work in Germany? Does ee work?

26. Energy advice for SME Is this progress a success? 4.904 4,978 4,748 new directive as of 3/2012 2010 2011 2013 approvals 3.432 3-12/2012 26How does energy efficiency work in Germany? / Berlin / 16 June 2014

27. 27 Development of environmental promotional volume: KfW-Energy Efficiency Programme became number 1 201120122013 EUR million KfW Energy Efficiency Programme3,208*3,5194,693 KfW Environmental Protection Programme*494490 KfW Renewable Energies Prog. - Standard from that Photovoltaics 6,517 7,574 4,219 4,353 1,005 KfW Renewable Energies Prog. – Storage--45 KfW Renewable Energies Prog. - Premium500363283 Total10,22511,8509,864 *ERP Environmental Protection and Energy Efficiency Programme How does energy efficiency work in Germany? / Berlin / 16 June 2014

28. www.kfw.de 28How does energy efficiency work in Germany? / Berlin / 16 June 2014

29. www.kfw.de 29How does energy efficiency work in Germany? / Berlin / 16 June 2014

30. www.kfw.de 30How does energy efficiency work in Germany? / Berlin / 16 June 2014

31. Do you need additional information? Contact Infocenter KfW Monday to Friday 8.00 a.m. – 6.00 p.m. 0800 539 9001 (free of charge) infocenter@kfw.de KfW group Palmengartenstrasse 5–9 60325 Frankfurt am Main www.kfw.de 31How does energy efficiency work in Germany? / Berlin / 16 June 2014

32. 32 KfW survey: Barriers to energy efficiency investments in the corporate sector › Lack of capital or capital already tied up for different purposes › Lack of time / staff to identify / implement saving potentials › Long amortisation periods › Lack of knowledge (also on efficiency potential) › Energy costs do not pose a sufficient incentive How does energy efficiency work in Germany? / Berlin / 16 June 2014