1. APP Boosting Energy Efficiency through PPP’s

2. Ethos Public Policies Lab
Ethos is a Think Tank dedicated to transform research projects into public policy proposals.
Our mission is to address the most relevant and innovative issues that can contribute to reach economic growth and social development in Mexico and Latin America.
Research areas
Innovation and Competitiveness
Public Finance and Fiscal Management
Gender
Poverty
Democracy and Governance capacity
Security and Urban Development

3. Importance of Energy Efficiency - National Context
Energy Efficiency is : do more with less...
Low applied cost of implementation.
High GHG reduction potential.
High cost-benefit ratio.
High energy and cost savings measures.
Relatively easy to implement vs other GHG reductions measures (e.g renewables).
High positive environmental impacts.
National Programs on Energy Efficiency
Energy Efficiency spending in Mexico 2014: MUSD $150.
In :
Average of total electricity savings: 5,473 GWh.
Average of GHG emissions mitigation: 2.48 Mton de CO2eq
Average total savings: MUSD $174
Programs include: Public lighting, federal buildings retrofit, water pumping systems, solar heating systems, illuminations systems substitutions.

4. ¿What are PPPs?
Legal instrument to develop projects in a responsible and result oriented manner, in topics including energy efficiency.
Provision of public services or infrastructure assets.
Backgrounds: United Kingdom, 1990.
Long term period (From 3 to 40 Federal Normativity)
Co-investment (Shared investment)
Admits third party investment
No subsidies scheme
Proved economic and social rentability

5. ¿What are PPPs? PPP legislation PPP in a holistic view (PPP law)
Contract under PPP Law or similar
PPP in a holistic view
these notions often are confused
PPP legislation
(PPP law)
Any form of collaboration between the public sector and the private sector
concessions
licenses
joint-venture
procurement
It is not a privatization
Does not create a new legal entity

6. Characteristics of PPP in Energy Efficiency
Contractual relationship between a public entity and a private organization;
Risk allocation between the parties, in line with their capacity to tackle or reduce the potential risks;
We look forward to foster the private investment in EE projects;
It has a payment scheme in which the private partner is payed given the services offered to the public sector.

7. Technical Studies- Social Profitability
To ensure the technical and financial feasibility of the project.
Cost-Benefit Cost
Convenience analysis
Socioeconomic Evaluation to a feasibility level
índice de elegibilidad
Análisis de riesgos
CB: para determinar la conveniencia men términos monetarios de los costos y beneficios asociados a la ejecución.
El análisis de conveniencia se coompone de tres herramientas:el índice de elegibilidad, el análisis de riesgo y el comparador del sector público que busca demostrar que el esquema de APP es mas redituable frente a otros sisttemas de contratación (O.P, fideicomisos, Ley de Adquisiciones). El resultado es el valor por dinero: demostrar que se genera mayor valor con el dinero invertido en el proyecto.
Comparador del sector público
VfM

8. Ethos experience in PPPs
Methodology to evaluate PPP legislation.
Methodology to evaluate projects with potential to be PPPs
Medicine Research Institute in Jalisco Mexico.
PPP project in EE in Jalisco.

9. Conclusions of Energy Efficiency through PPP´s
Overcome fiscal and political cycles.
Due budgetary constraints private sector can make all the investment.
Energy Efficiency projects promote important energy and money savings.
Reduce debt and budget constraint.
Long term contracts.