Situation

SEGRO owns, manages and develops modern warehousing, light industrial and data centre properties, principally concentrated in London’s Western Corridor and key conurbations in France, Germany and Poland. As part of the company’s 2020 sustainability strategy, it aims to increase renewable energy generating capacity across the Group. SEGRO is achieving this through technologies such as PV panels, ground and air source heat pumps, and solar thermal heating. Projects include direct investment, as well as support for occupiers that wish to carry out renewable energy installations in SEGRO buildings. This article focuses on how SEGRO has retrofitted photovoltaic arrays onto existing buildings.

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Timeline of SEGRO’s renewable energy progress:

• 2010: SEGRO evaluated the feasibility of installing PV panels at a number of properties. The payback period was generally eight to 11 years, with an overall return on investment of around 8 to 10%, making this a viable option. At SEGRO’s site in Frankfurt, 75,300 sq ft of PV panels were installed through a rental agreement with energy firm Juwi Solar, providing SEGRO with rental income and giving the occupier access to clean power at preferential rates.

• 2011: SEGRO worked with occupiers and energy firms to complete PV installations at 18 properties. Feed-in Tariffs in Belgium, the Czech Republic, France, Germany and the UK provided an additional incentive for the company to rent or use roof space for renewables. In Germany, PV installations included 219,600 sq ft at Winsen Benzstrasse Logistics Centre in Hamburg with Juwi Solar and occupier Takko, and over 1,400 panels at Dormagen and Darmstadt with Pohlen-Gruppe. In the UK, installations on three properties in Slough, occupied by LG Electronics, Staples and AZUR Solar, generate 117,000 kWh each year.

• 2013: SEGRO retrofitted additional schemes on a number of buildings, including The Heston Centre and X2 at Heathrow, IQ Winnersh near Reading, Bornem and Rumst in Belgium. Factors considered prior to installation included the building orientation, roof structure and existing occupier energy demand. The company also launched a scheme to fund PV panels on suitable buildings across the portfolio, setting aside funds for different business areas. Through the scheme, SEGRO offers occupiers the opportunity to purchase renewable electricity at reduced rates, with surplus energy sold to the National Grid.

• 2014: SEGRO delivered the first PV arrays installed through its renewables funding scheme. The first project to go ahead through the scheme was a 50 kWp installation at Greenford Park in London, which supplies around 50% of occupier Wholegood’s energy requirements in the warehouse, contributing to its aim to be a carbon neutral business. This was followed by 50 kWp at 258 Bath Road in Slough, SEGRO’s new headquarters, which supplies around 60% of SEGRO’s energy requirements in the offices. This installation was delivered as part of a refurbishment project that achieved a BREEAM Very Good rating and raised the building’s Energy Performance Certificate (EPC) rating from G to C, reducing exposure to the Government’s Minimum Energy Efficiency Standards, which come into force in 2018. In addition, 130 kWp was added at 7B Fairlie Road in Slough, which generates up to 120,000 kWh per year, enabling occupier All Print Supplies to be virtually independent of the National Grid in terms of their energy requirements.

• 2015: SEGRO set aside specific budgets across the Group to fund SEGRO-owned renewable energy projects, with over 750 kWp of projects due to be completed by the end of the calendar year. The company will also continue to work with occupiers to support their renewable energy projects where possible.

Financials

SEGRO pays the capital requirement for each renewable energy project and then either leases the system or sells the energy to the occupier. The scheme mechanics enable both SEGRO and occupiers to benefit

• £600,000 of additional income generated for SEGRO from PV roof panels in 2014
• Average energy cost savings for occupiers of 30% against their standard energy rate in 2014
• Average payback on investment for SEGRO of around eight years.

Benefits

SEGRO’s renewable funding scheme is a scalable project that can be repeated across the portfolio, creating both commercial and environmental value:

• Generating 8.3 million kWh renewable energy in 2014, including third-party owned systems
• Producing enough renewable electricity in 2014 to power more than 2,000 homes for a year¹ and cutting CO₂ emissions
• Increasing renewable energy generated by 10% in 2014 compared to 2013, supporting SEGRO’s 2020 sustainability goals
• Contributing to improved EPC ratings and BREEAM sustainability certification for individual assets
• Adding value as an asset management tool, cutting occupier energy costs, reducing occupiers’ reliance on National Grid supplied electricity and supporting occupiers’ sustainability goals, all of which has strengthened SEGRO’s relationships with occupiers
• Preparing the SEGRO portfolio for increasing legislation on the energy efficiency of buildings and greater customer focus on energy efficiency.

^{1. Department of Energy and Climate Change: Energy Consumption in the UK (2015): Chapter 3}

Find out more

Terry Clarke

Technical Sustainability Manager

SEGRO

www.SEGRO.com