Public Commentary: This overview presents FG Capital’s perspective on Fuel & Energy Management Program (FEMP) carbon-credit transactions. It is provided for informational purposes only and should not be construed as investment advice or a solicitation.
FEMP Carbon Projects – Fuel and Energy Management Program Structuring
Integrated fuel and energy management delivers rapid, measurable emission reductions by optimising how facilities and fleets purchase, store, and consume energy. Typical interventions include fuel switching, advanced monitoring, waste-heat recovery, and behavioural change programmes. When rigorously monitored against a credible baseline, these savings translate into verified emission reductions (VERs) that complement direct cost savings. FG Capital provides end-to-end structuring, capital raising, and market-access solutions to monetise those reductions efficiently and transparently.
Project Scope
• Fuel Optimisation for Industrial Boilers:
Transition from heavy fuel oil to LNG or biomass, including burner retrofits.
• Fleet Fuel Management:
Telematics-enabled driver behaviour programmes, route optimisation, and adoption of drop-in biofuels.
• Steam-System Efficiency:
Condensate recovery, insulation upgrades, and automatic blow-down controls.
• Waste-Heat Utilisation:
Organic Rankine Cycle generators and heat-to-power solutions.
• Digital Energy-Management Platforms:
Real-time metering, anomaly detection, and predictive maintenance analytics.
Advisory Process
1 | Baseline & Additionality Assessment
• High-resolution fuel-consumption data and process-simulation modelling establish the business-as-usual scenario.
• Alignment with methodologies such as Verra AMS-III.B or Gold Standard Fuel Switch frameworks.
2 | Financial Structuring
• Performance-based Energy-Service Agreements, shared-savings contracts, or off-balance-sheet ESCO financing.
• Advance credit purchase contracts to strengthen debt-service coverage.
3 | Implementation Oversight
• Vendor selection, engineering design reviews, and commissioning protocols with performance guarantees.
• Training programmes to institutionalise operational best practice.
4 | MRV & Verification
• Continuous monitoring via IoT sensors; ISO 50001-aligned data governance.
• Periodic third-party audits leading to credit issuance on recognised registries.
5 | Credit Monetisation
• Multi-year offtake agreements with investment-grade corporates.
• Spot trading support to capture upside once delivery milestones are demonstrated.
Indicative Financial Parameters
| Metric | Typical Range |
|---|---|
| Capital Intensity (USD / tCO 2 e avoided) | 5 – 18 |
| Simple Payback (energy savings only) | 2 – 5 years |
| Forward Credit Price (Year 0, USD / t) | 8 – 12 |
| Target Equity IRR | 13 % – 17 % |
Representative Capital Stack
| Tier | Security Package | Cost of Capital | Typical Providers |
|---|---|---|---|
| Senior Energy-Savings Loan | Assignment of fuel-cost savings; equipment lien | SOFR + 260 – 340 bps | Commercial banks, green-loan facilities |
| Subordinated Credit Facility | Second-lien on project assets | SOFR + 475 – 625 bps | Private credit funds |
| Advance Credit Purchase | Delivery contract with make-good provisions | Fixed price USD 9 / t | Corporate sustainability desks |
| Sponsor Equity | Residual cash flow | Target IRR 13 % – 17 % | ESCOs, industrial operators |
Stakeholder Benefits
- Industrial & Commercial Operators: Reduced operating expenditure, enhanced energy security, and a new revenue line from credit sales.
- Credit Purchasers: Verifiable avoidance credits sourced from tangible efficiency improvements.
- Investors: Predictable cash flows supported by energy-cost savings and carbon-credit upside.
- Communities: Lower local pollutants and improved public-health outcomes.
Engagement
Organisations evaluating a Fuel & Energy Management Program are invited to engage with our advisory team. We would be pleased to discuss feasibility assessments, financing structures, and long-term project governance.
This document has been prepared solely for informational purposes. It does not constitute investment advice and should not be regarded as an offer to buy or sell any security, financial instrument, or service. Independent professional guidance is recommended before acting on any information contained herein.
