Dubai, UAE: Financing is available for government retrofit projects in the UAE, but the scenario is still challenging for private-sector retrofit projects, said Stephan Le Gentil, CEO of Etihad ESCO, which is a part of the Dubai Supreme Council of Energy. Government investors, like National Bonds, are coming forward with funding for government projects, he added.
The Government of Dubai in 2013 launched a retrofitting programme, targeting 30,000 existing buildings out of the existing stock of 120,000 buildings in the emirate. The aim of the government is to improve the environmental footprint of the buildings by the year 2030, through incorporating energy-efficiency measures in them.
One of the challenges in raising finance is owing to a general reluctance among banks and other financial institutions to lend money in the absence of collateral, which is a requisite in conventional project-financing.
Building owners and energy service companies (ESCOs) engaged in performance management contracting jobs are exploring various channels for raising finance. They are simultaneously making efforts to reduce the cost of retrofitting, and are approaching manufacturers for solutions. For their part, some manufacturers are showing a willingness to offer equipment on lease basis. However, even here, options are limited. Chiller manufacturers, for instance, are willing to lease the equipment and nothing more, Le Gentil said. A typical retrofit project involving chillers requires other equipment as an overall solution for the project.
(The writer is the Editor of Climate Control Middle East and the Editorial Director & Associate Publisher of CPI Industry.)