Clime Capital Funding Will See Reduced Emissions, Costs For Sheraton Mustika in Yogyakarta

Clime Capital, the Singapore-based fund manager focused on accelerating the low carbon transition, and Synergy Efficiency Solutions (SES), Indonesia’s leading energy efficiency company, have announced the completion of a first-of-its-kind in Indonesia energy efficiency project contracted under an innovative Cooling-as-a-Service (CaaS) model.

Similar to a water company metering and selling water to its clients, under the CaaS contract SES will sell units of cooling (measured as TRh) and charge based on actual cooling consumption.

The project is targeted to reduce expenditure on energy for cooling by as much as 45% and mitigate 20,000 tons of CO2 over the equipment’s lifetime.

As part of the CaaS agreement, SES provided a turn-key solution covering all up-front capital and managed all aspects of the design and installation for the new high-efficiency centralised cooling system for the project’s client – the five-star Sheraton Mustika Hotel located in Yogyakarta, Indonesia.

The project is based on an initial Investment Grade Energy Audit conducted by SES and implemented using AI software to optimise the chiller plant’s operation, maximising efficiency. Over the duration of the contract, SES will operate the chiller plant and bear all associated operational costs, including electricity, consumables, maintenance and spare parts.

Impactful Climate Solutions

Clime Capital, a blended-finance fund manager specialising in financial solutions for early-stage clean-energy projects in Southeast Asia, provided funding for SES’s initial audit and set-up costs.

“We are delighted that SES has put in place this pioneering cooling agreement, which promises to lock in predictable and significant energy-saving benefits for the hotel, its customers, and staff,” said Joshua Kramer, Chief Investment Officer at Clime Capital. “Energy efficiency is often overlooked as an effective and immediate route to emissions reductions – SES is demonstrating how to invest in impactful climate solutions while removing the risk and project complexity from the client’s purview.”

“Southeast Asia is one of the world’s most vulnerable areas to the impacts of climate change and Clime Capital is committed to helping businesses and communities reach net zero emissions,” said Mason Wallick, Chief Executive Officer of Clime Capital. “Employing smart energy efficiency solutions cost-efficiently can help address this need while delivering positive financial outcomes for all parties involved. SES has developed a robust revenue model that can potentially attract follow-on debt and equity investments, playing a dynamic role in accelerating the low carbon transition.”

SES has a strong track record of implementing innovative energy efficiency business models in Indonesia.

It was the first Energy Services Company (ESCO) to implement a multi-scope Energy Savings Performance Contract (ESPC) in Indonesia, when SES provided all upfront capital for an ESPC with Adi Husada Hospital in Surabaya between 2015 and 2020, with SES and the client sharing the financial savings from the project throughout the period.

The project involved a complete retrofit of the hot water, steam, cooling, building envelope, lighting, and monitoring systems, cutting the hospital’s energy costs by 38%.

With SES covering all project CAPEX, the hospital was not only able to enjoy a reduced energy bill and greater comfort in the form of improved hot water and cooling systems, but was also able to reallocate a large amount of annual CAPEX away from fixing assets such as boilers and air conditioners and invest it in purchasing new medical equipment to support the local community.