Green Investment Bank helps finance Southend-on-Sea streetlighting replacement programme

• Southend-on-Sea Borough Council secures commitment of £8.2m from GIB to accelerate energy and cost-saving scheme
• 14,000 streetlights and 4,000 illuminated signs and bollards to be replaced, saving around £25m over 25 years
• GIB financing allows cost savings to flow to the council immediately
• New LED lighting could cut energy use by 55 per cent and cut greenhouse emissions by over 16,500 tonnes
• Replacing all the UK’s street lights with LED alternatives could save the UK £200m per year and cut 475,000 tonnes CO₂e annually.

Southend-on-Sea Borough Council has become the first local authority in England to secure finance from the UK Green Investment Bank plc (GIB) to replace its existing streetlights with lower energy alternatives.

GIB has agreed to provide funding of £8.2m alongside a grant of £5.1m from the Department for Transport (DfT) as part of a £13.5m programme of refurbishments that will see 14,000 lanterns and around 4,000 other pieces of illuminated street furniture, replaced with energy-saving LED alternatives.

The agreement also covers the renewal of ageing streetlighting columns and the installation of a central management system (CMS) that will allow the council to manage remotely its lanterns across the borough. The CMS will also improve monitoring and metering, allowing the council to manage its lighting estate more effectively.

The council believes that the installation of LED streetlighting will more than pay for itself through savings of around £25m over 25 years. The lights are expected to use at least 55 per cent less energy than existing lights and to cut greenhouse gas emissions by more than 16,500 tonnes during their lifetime.

The energy saved would be equivalent to the total electricity consumed by almost 1,000 homes.

The scheme qualified for the GIB’s Green Loan, which offers UK local authorities a low, fixed-rate financial arrangement over a period of up to 30 years. It has been specifically designed to finance public sector energy efficiency projects where repayments are less than the savings realised.

GIB signed a similar agreement earlier this year with Glasgow City Council and is in discussions with a number of other local authorities and public bodies about financing further streetlighting and low carbon and renewables projects.

"Local authorities throughout the UK are increasingly adopting cost-effective ways of improving their services. Our Green Loan is tailor-made to fit the needs of individual authorities and is geared towards creating an invest-to-save mentality that saves both energy and costs while cutting greenhouse gas emissions. We’re delighted to have helped Southend-on-Sea Borough Council accelerate its streetlighting refit programme and hope that the agreement encourages its peer organisations to consider initiating similar strategies."

Ed Northam
Head of Investment Banking at the Green Investment Bank

"Bringing this popular project forward is a win-win situation. The sooner we replace every lamp in the Borough, the sooner we can save money, reduce carbon emissions and provide residents and motorists with brighter, cleaner light.

Unlike many other authorities in the country, this council was determined not to plunge our borough into darkness as a means of making much-needed savings. Instead we listened to the voice of local residents and opted to invest in green technology as a means of saving money in the longer term. We’ve chose a pioneering solution that shields residents from increased fear of crime and poorer road safety that are often associated with turning the streetlights out.

We’re proud to be the first local authority in England to use the Green Investment Bank in this way, securing a favourable financial arrangement that will speed up this ambitious, innovative and hugely important project."

Councillor Martin Terry
Executive Member for Public Protection, Waste & Transport at Southend-on-Sea Borough Council

"LEDs can last more than six times longer than standard bulbs. As well as delivering practical cost savings, switching all of the UK’s streetlights could reduce greenhouse gas emissions by approximately 475,000 tonnes every year. That’s the equivalent of taking over 200,000 cars off the road. The Green Loan is specifically designed to help spread costs. Councils that make similar investments could benefit from immediate cost savings that help alleviate budgetary pressures."

Gregor Paterson-Jones
Managing director of Energy Efficiency at the Green Investment Bank

A report released by GIB in February 2014 – ‘Low energy streetlighting: making the switch’ – estimated that the UK could save £200m every year by replacing every one of its 7.4 million streetlights with low-energy LEDs.

GIB and its legal advisors Shepherd and Wederburn LLP have standardised the Green Loan investment process to save the public sector time and money in agreeing a financing package for energy efficiency projects.