Daiva Matonienė, Member of Šiauliai City Municipal Council (Lithuania). European Conservatives and Reformists Group (ECR) member, is coordinator of the ENVE Commission at the European Committee of the Regions. and manages the work on “Renewable energy and internal electricity market”. She is an expert in town twinning and a member of the Commission’s body in charge of provide candidates and potential candidates for EU membership, and the EU’s eastern and southern neighbors, with technical know-how and legislative expertise (Technical Assistance and Information Exchange instrument of the European Commission TAIEX).
You are a Member of Šiauliai City Municipal Council in Lithuania. How has your local government found innovative ways to finance energy efficiency in building renovation?
In my opinion, the local level plays an essential role in sustainable housing. In 2013, the Lithuanian Government removed barriers for the creation of a new renovation model which would strengthen municipalities’ role in this area while avoiding financial and administrative burden on households.
With this new model, municipalities are able to select the most energetically-inefficient multi-flats buildings, appoint the legal entity (administrator) that takes loans for the renovation process and provides technical supervision of the construction works. Municipalities can also do their own procurements or go through the centralised system, which is faster. Technical support is very important in procurement and its provided by an agency owned by the Ministry for the Environment. The Agency participates in providing housing information and supporting design of investment projects.
For a better understanding of financial resources, it is particularly important to have close cooperation between national, local governments and professional financial institutions.
Indeed Lithuania, in close cooperation with the European Investment Bank has developed an innovative financing scheme- JESSICA Holding Fund- for this Program. JESSICA (Joint European Support for Sustainable Investment in City Areas) is an initiative of the European Commission in cooperation with the European Investment Bank (EIB) and the Council of Europe Development Bank (CEB) that promotes sustainable investment and jobs creation in Europe’s urban areas. The overall aim of the scheme is to contribute to increase energy efficiency in the housing sector by offering long term loan financings at preferential terms and conditions.
Private investment is a crucial source to fund energy efficiency renovations in buildings. How did you manage to attract private investment during your mandate as a vice Minister for the Environment? How did you get local governments involved in this program?
I would like to quote the famous sentence: “In real life all good ideas are not implemented due to lack of money”. In my opinion this is not true. The world has enough money, rather we need to have a good idea and combined efforts. For example, Lithuania is one of the first countries in the European Union to use the initiative of JESSICA for the improvement of energy efficiency in multi flats buildings. After buildings renovation, we saved between 40% and 50% on energy consumption that was concretely translated into -10% in bills to the house owner.
Financial instruments are needed to attract private investments and multiply them. The next program, Jessica II (2014-2020) will guarantee the existence of project planning, of the government program and attract more private investment. Furthermore, a financial instrument will be guaranteed to attract additional funds from private sources (expected leverage of a ratio of 1:5 for each public euro mobilised).
In this domain, like in Lithuanian Basketball, we have achieved real cooperation for the implementation of energy efficiency projects. Thanks to professional and active teamwork and close cooperation between national and local level and EIB, now all 60 Lithuanian municipalities will not be observers anymore, but active participants in this programme. Also, the number of banks willing to participate to the program is increasing.
To which extent do you think the solutions adopted in Lithuania for energy efficiency renovations in buildings could be transferred to other regions and local contexts in Europe?
Unfortunately, there is no one-solution for all. Every country is required to make detailed analysis and identify the main barriers in its national context. The “copy- paste” function is not accepted, and it is necessary to find tailor-made solutions. The most important is not be afraid to make changes.
You were a speaker at the CITYnvest workshop “Innovative financial mechanisms for the energy efficiency projects in Latvia” in Riga on 10 May 2017. Did you find that common solutions can be applied to similar problem in your country and Latvia?
Lithuania and Latvia are friendly neighbor countries and have many similarities. I see that we have the same buildings, constructed back in the Soviet Union time, and the same technical renovation solutions could be implement in Latvia.
also, I see similarities in societies and cultural mindset: chronic distrust of population in government, failed public relations program, apartment owners poorly organized, and largely relying on fixed income. We solved the same problems in Lithuania. A common solution I could recommend is that municipalities must work directly with citizens and help them.
The second CITYnvest Lithuania workshop will take place on 13 June in Vilnius. On this occasion where two case studies from London City (RE:FIT) and Liege Region (RenoWatt) will be presented. What should be the added value that those case studies could bring to the Lithuanian context?
Practical example and lessons provided from other countries could be useful for Lithuania. As the popular sentence goes: “A stupid man who has not learned from his mistakes learns intelligently from others' “.
Sharing of knowledge and experiences must be improved between EU cities. Crucially, we also need to be open by saying that sustainability will have to be at the heart of our urban development policies if we want our cities and regions to be a source of growth and jobs. I would like wish you huge success and a productive event in Lithuania!