IEA Cities TCP Task 3: How do you finance a multiple value business case?

date: 4 April 2025

How do you finance a multiple business? It would seem that the most obvious answer would be “”by using blended finance””. However for multiple business cases blended finance has a slightly different meaning. Blended finance usually refers to the financing of a single project during the risk-intensive phase, and then re-financing with other funds during a less risk- intensive phase. In a multiple business case, however, this can also be the case with finance from various different sources which is a different blend. For example a fifth-generation heating and cooling grid that not only receives money from energy producers and network operators, but also from users, a climate mitigation fund, and network operators.

How does the initiator of a fifth-generation heating and cooling grid attract interest from different parties to invest? A relatively new proven method is the Investment Platform. This will help to get the discussion started, but there are still several problems which remain. The first is that of risk perception. Financiers see multiple risks in a multiple project, while the initiator sees a resilient system that reduces risks. A second challenge is the risk that a controller may disagree with the amount earmarked for combatting avoidance of grid congestion by the heating and cooling grid. A third problem is what possibilities are there to create a fund specifically intended for financing multiple business cases.

These three problems are just at the tip of the iceberg and were addressed during different workshops with the aim of preparing and designing the TCP Cities Task 3, “Financing the Energy Transition in Cities, how can place- based multiple benefit case help cities?”