They are discussing a permanent fund to finance the building renovation

Raya Lecheva

To ensure sustainability of the process with a road map at least until 2030, systematic annual financing from the republican budget and maximum use of European sources - Modernization Fund, European Climate Fund, etc., insisted the representatives of the RENOVATE BULGARIA Coalition.

It is being discussed how to guarantee a permanent fund to support building renovation, the Coalition RENOVATE BULGARIA announced. The most urgent task is the provision of financial resources for 20% co-financing by the owners of multi-family residential buildings, the Coalition explained.

The occasion is the application for the first stage, which ended just a month ago, and the second stage of the building renovation program announced immediately after, under the National Recovery and Sustainability Plan (NRSP). With more than 3,000 submitted applications for a budget of over BGN 4 billion with available resources for about 1/4 of the amount, the enormous interest and perceived need on the part of the owners is an indisputable fact. "There is no doubt that this momentum must be preserved and supported in every way with the necessary mechanisms and resources," said Mincho Benov, director of Habitat Bulgaria.

At the same time, it is clear that the implementation of the second stage of the program, which requires 20% co-financing from the owners, faces a number of challenges. The implementation of the reforms in NRSP, which should "facilitate renewal process and to support citizens' has been delayed and there is a need for quick response and urgent measures to ensure the success of the shared financial responsibility model.

The options are a bank guarantee or an ESCO instrument

In this connection, at the meeting with the Deputy Minister of Regional Development and Public Works, problematic issues, possible solutions and proposals of the Coalition on priority topics were discussed: The most urgent task at the moment is to support the provision of financial resources for 20% co-financing from to the owners, either through a bank guarantee or through an ESCO instrument.

The much-anticipated National Decarbonization Fund (NDF) should be launched in 2024, and applications for the second stage close at the end of this year. Therefore, we are looking for opportunities and discussing financial mechanisms that can will work until autumn, said Deputy Minister Boneva. A sustainable long-term solution is access for homeowner associations to collective preferential loans. Based on this idea and on the basis of good European practices, we have been working with commercial companies for two years banks and BBR, and if there was no interest before, now they are much more willing to engage, said Ivan Velkov, chairman of the Bulgarian Facility Management Association (BFMA).

According to Asya Dobrudjalieva from "Habitat Bulgaria", state subsidization of interest rates is necessary in order to increase the attractiveness of loans. A commitment was made by the representatives of the BFMA to provide all the information on the progress so far on the subject, and Mrs. Boneva is committed to assist in supporting efforts in this direction.

The use of ESCO companies to provide 20% of the investment is also an option, as it is paid through the savings of the building, could be a workable solution, companies in the industry comment. Each will want to attract the interest of the owners and will offer good conditions, and will have an interest in achieving maximum savings, the ESCO branch commented to 3eNews.

However, this approach is still little known and is unlikely to be the only option for owners, because it carries some risks because it is still little known, the organizations share. Perhaps the best option will be credit lines from the Bulgarian Development Bank, experts point out.

One-off energy efficiency investment voucher for poor households

In connection with co-financing, the topic of energy poverty was also discussed, both in a social and economic context. In addition to the established energy support, in each building there may be owners who cannot afford an investment in energy efficiency and will need additional support. The idea of a one-time investment voucher was discussed as a concrete possibility for a decision in this direction.

The other round of problems discussed at the meeting is related to the high requirements for the owners under the second stage scheme, without the necessary expertise being adequately provided. Owners are expected to delegate and be responsible for multiple activities, and therefore require professional knowledge and experience that not all owners possess.

The 2.5% provided for in the scheme for management and publicity, which may also cover advisory services, may be insufficient. At the same time, full responsibility for the quality of the technical documentation and for the implementation of the indicators are attributed specifically to the owners and this is extremely worrying for potential candidates, commented Tsveta Nanova, Deputy Chairman of the Board of Directors of BFMA and Executive Director of "Bulgarian-Austrian Consulting Company".

In the medium term, there is also the issue of implementing the one-stop service reform. These should be centers for shared services, why not even on a business basis in partnership with local authorities. Some municipalities have already established application centers for the program and we should benefit from this experience. It also takes effort and investments for the qualification of this type of specialist, said Deputy Minister Angelina Boneva. Tsveta Nanyova informed the participants that a new SHEERenovPLUS project will be launched in the autumn, applying exactly this approach, in which at least six new centers will be created in the country, the Coalition announced.

To ensure the sustainability of the process with a roadmap at least until 2030

To ensure sustainability of the process with a road map at least until 2030, systematic annual financing from the republican budget and maximum use of European sources - Modernization Fund, European Climate Fund, etc., insisted the representatives of the RENOVATE BULGARIA Coalition. This is the only way to respond to the enormous needs for renovation in the housing sector, the high expectations of the population and the commitments undertaken by our country within the framework of the European Green Deal. "Before we have these mechanisms, we cannot talk about meaningful communication with citizens, and without their participation, the conversation about policies in the housing sector becomes pointless," said Dragomir Tsanev, executive director of the Center for Energy Efficiency EnEffect. "If we fail at this stage now, we limit our access to European funding for energy efficiency for years to come, and that will only make us poorer," he added.

Representatives of the RENOVATE BULGARIA Coalition met with the Deputy Minister of Regional Development and Public Works Angelina Boneva (first from right to left) to discuss the implementation and future development of energy efficiency programs in multi-family residential buildings.

The meeting was attended by Dragomir Tsanev, executive director of the Center for Energy Efficiency EnEfect (first from the right), Tsveta Nanova, vice-chairman of the Board of Directors of BFMA, Ivan Velkov, chairman of the Board of Directors of BFMA, Mincho Benov, director of "Habitat Bulgaria" and Asya Dobrudjalieva from "Habitat Bulgaria".