Buildings

The use of energy to power the buildings we live and work in accounts for over 7.9% of global greenhouse gas emissions annually (IPCC 2007).

Overview

Energy efficiency measures, both for retrofitting the existing building stock and for the design of new buildings, offer a large opportunity for cost-effective reductions in energy use – and results are available immediately. Historically, energy efficiency finance has been driven by traditional models in municipalities, private lines of credit for homeowners and businesses, ESCO's, and rebates via utilities. 30 years of such programs have had a limited effect on creating scalable impact, despite the demonstrated business opportunity presented by energy efficiency.

Opportunities

New financial products that either utilize low-cost or off-balance sheet financing are required to overcome the various structural barriers preventing energy efficiency retrofits. In addition, business models are needed to address the fundamental market barriers that prevent the scale-up of energy efficiency retrofits: high upfront costs for consumers, inconvenience of retrofits, lack of consumer information, over-stretched balance sheets, inability to secure additional capital, and a significant principal-agent problem due to split incentives.

Help us continue our research and identify opportunities; click on the sub-sector to learn more, join our group on LinkedIn to engage with our community, and download our energy efficiency report.