The Fund was established by a Local Authority (City of Litoměřice) as a part of its internal budget, aiming to reduce long-term operating energy costs.
Investment and operational demands can be reduced by implementing appropriate measures. Such measures provide objective and transparent evidence of actions taken by the local authority, making the most of public resources to deliver benefits for its citizens.

The Fund aims to reduce long-term operating energy costs of the Local Authority and assets it runs, such as schools, museums and libraries (“subsidized organizations”) by implementing energy efficient measures and installing renewable energy sources with minimum impact on the municipal budget. In addition, funds re-invested in energy saving and utilization of renewable energy sources have a long-term multiplying effect for the municipality.

To maintain a long-term sustainability of the Fund, net savings are distributed among key stakeholders as follows:
• 35% allocated directly to the city budget
• 30% allocated to the Fund of Energy Savings and RES
• 30% of the allocated specific subsidized organization where saving energy or using renewable energy sources have been implemented
• 5% allocated to the reward fund.

The Fund finances preparation of quality documentation (including project studies, energy audits, assessments, grant proposals). In future, once the Fund allocation is higher, it is anticipated it will be used to finance implementation of EE and RES measures directly. Currently measures are finance using a mix of sources: municipal budget, grant funding, EPC and/or bank loans.

Resources needed

The City Council decides on the specific allocation for the given year based on the Financial Committee recommendations and the Energy Manager performance reports. In 2016 the total amount of the Fund was €25 000.

Evidence of success

Because of the Fund existence, having sufficient resources to prepare good quality pilot projects the municipality was able to implement many EE and RES projects and achieved these results.
In the year 2016 net savings amounted to €55 000, in 2015 €51 000, in 2014 €98 400. As a result, since 2012 total energy savings in Local Authority buildings have amounted to more than €886 000.
Figures from 2014 show: 752 000 kWh/year, 80 000 kWh/year renewable energy produced, and 650 tonnes/year CO2 save

Potential for learning or transfer

Municipalities with established energy management could fairly simply adopt this practice. The fact that no upfront ring-fencing of funds is needed could be attractive to other municipalities.

The principle of dividing the net savings among relevant stakeholders is a very clever motivation element that ensures all stakeholders are involved and interested in achieving best results possible.

It is beneficial to start a dialogue with the subsidised organisations at an early stage, and to explain in detail how the Fund operates, how savings can be achieved and how net savings are calculated.

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Main institution
City of Litoměřice
Severozápad, Czech Republic (Česká Republika)
Start Date
January 2014
End Date


Tereza McLaughlin Váňová Please login to contact the author.