Accelerating the UK’s Net Zero journey to the next level
The announcement of a new agreement with NatWest to provide £40 million of project funding is set to accelerate the UK’s journey towards Net Zero. The new model will finance energy transition projects for eEnergy’s public sector customers – from schools and hospitals to council buildings across the UK.
The ability to finance public sector projects and borrowing at competitive interest rates will provide countless opportunities for organisations to switch to energy efficient lighting, reduce energy waste and install solar panels to both decrease carbon emissions and lower energy costs.
Financing energy efficiency for our public sector customers.
Large-scale sustainability projects – overhauling lighting to fit energy-efficient LEDs or reducing reliance on volatile markets through solar on-site generation – are often perceived as daunting and costly. Further to this, organisations and bodies across the public sector have had to rely on insufficient support to start and progress their Net Zero journeys. A shift to a more pragmatic approach to reach Net Zero by 2050 is therefore essential.
Education and healthcare institutions are the country’s most crucial services, and they particularly struggle with huge energy bills, emissions’ targets and energy waste. This new financing solution with NatWest will enable eEnergy to facilitate larger-scale energy efficiency projects for the public sector and make Net Zero possible, despite shrinking budgets.
The agreement with NatWest has been designed exclusively for the funding of public sector energy transition projects across the full range of eEnergy products. This will open up new opportunities across the three key pillars of eEnergy’s offering: Reduction, Generation and Charging.
- Reduction: Overcome the challenges associated with identifying energy reduction opportunities, as well as the design and installation of LED lighting and controls. The switch to LED lighting can result in up to 70% reduction in costs and 30% reduction in energy bills.
- Generation: Designing and installing onsite solar systems to cut energy costs by up to 20%, while facilitating decreased carbon emissions.
- Charging: Comprehensive EV charging solutions that enable organisations to embrace fleet electrification or simply provide EV charging facilities for staff, reducing scope three carbon emissions.
Our commitment to a more sustainable future.
Being backed by NatWest, one of the UK’s most trusted financial institutions, eEnergy is now able to expand the scope of opportunity – extending the model of zero upfront capital further than ever before.
The ability to offer eEnergy’s services across multiple sites now enables support for schools, hospitals and councils to build a more sustainable future.
Comments from Leadership
Harvey Sinclair, eEnergy CEO, comments: “We are extremely pleased to announce this £40m Facility with NatWest, marking the beginning of a new collaboration between our two organisations. This Facility is the result of significant investment in honing our proposition to public sector customers and gives eEnergy a clear competitive advantage in the market. It also allows us to offer our leading net zero energy efficiency services to larger multi-site projects and contracts. This Facility has been structured to allow us to scale rapidly in a large addressable UK market.
“What is particularly exciting about this new Facility is its innovative structure which will lower our cost of capital and also provide us with longer-term economic upside on each project.
“We look forward to this new relationship with NatWest which we hope is a start of a much longer-term relationship given the opportunities available.”
Jacob Lloyd, Head of Specialist Asset Finance at NatWest, comments: “NatWest is delighted to be able to support eEnergy by acting as Structuring Bank & Hedge Counterparty for this innovative financing. We look forward to working with the eEnergy team going forward as they execute their contract pipeline and assist the public sector with deploying energy efficiency and decarbonisation assets.”
£40m Project Funding Facility with NatWest and Trading Update
London, 1st March 2024: eEnergy Group plc (AIM: EAAS), is pleased to announce it has entered into an agreement with National Westminster Bank Plc (“NatWest”) to provide up to £40 million of project funding (the “Facility”) to finance energy efficiency and onsite generation technologies for the Group’s public sector customers.
The Facility is a new financing solution created by both parties. The Facility has been designed exclusively for the funding of public sector energy transition projects across the full range of eEnergy products. The Facility will be deployed through a newly-formed special purpose vehicle (“SPV”) owned by eEnergy, with eEnergy becoming the operator and retaining ownership and interest in the economics of each completed project.
The Facility is available for a period of 12 years with investment planned over the first 24 months. The Facility is split into two equal tranches to match the expected profile of drawdowns and optimise fees. The second tranche will become available to draw-down once 75% of the first tranche has been deployed, subject to customary final approvals.
The Board believes that this new Facility gives eEnergy a unique, compliant off balance sheet solution for public sector customers and will strengthen eEnergy’s competitive position in tendering for large multi-site contracts. The Facility will lower eEnergy’s cost of capital, delivering an attractive financial return on the retained project interests.
Longspur Capital acted as eEnergy’s sole financial advisor in relation to the Facility.
Trading Update.
Trading in the 6-month period ended 31 December 2023 was impacted by the Group’s balance sheet constraints which have now been alleviated as a result of the sale of the Energy Management division. In addition, management have chosen to re-profile solar project revenue and adjust the FY23 results for the Energy Management division in relation to its subsequent disposal. As a result, the Board expects, subject to completion of the audit process, to report Group Revenues for 18-months ended 31 December 2023 of £46 million with Adjusted EBITDA of £5.1 million – £5.3 million.
The completion of the disposal of the Energy Management division after the period-end has enabled the Group to repay all borrowings, substantially strengthen its balance sheet and refocus resources on delivering on the growth opportunities in the Energy Services division.
The Company expects the annual audited accounts for the 18 months to 31 December 2023 to be released in the last week of April 2024.
