Novel Financing Model for Renewable Cooling, Heating and Electricity: The Initial-Aid Cashback Model

The accelerating global demand for renewable heating, cooling and electricity, driven by climate change and rising living standards, presents both a challenge and an opportunity for sustainable energy transitions. This paper introduces the Initial-Aid Cashback (IAC) model, an innovative business model designed to finance renewable energy solutions, with a focus on space cooling, by leveraging citizen participation and collaborative financing mechanisms. The model incentivizes private investors through discounted energy prices, while system operators benefit from reduced upfront capital requirements and minimised financial risk. Through two case studies, an office building in Romania (small-scale case) and the application of the REGEN-BY-2 technology in a mixed housing–office area (large-scale case), the paper demonstrates the model’s potential to accelerate the adoption of renewable cooling technologies, enhance profitability for operators, and provide attractive returns for investors. The findings highlight the model’s adaptability to diverse stakeholder needs, its scalability, and its role in fostering the clean energy transition (CET). However, challenges such as the need for a minimum number of investors, legal complexities, and trust-building among stakeholders are identified as critical barriers to implementation. The paper concludes that the IAC model offers a promising pathway to integrate citizens and small investors into the CET, while emphasising the importance of supportive policies, clear governance structures, and practical testing to ensure its success.