Energy Services Performance Contracting: How It Can Save You Money and Improve Energy Efficiency
As energy costs continue to rise, many businesses and organizations are seeking ways to reduce their energy consumption and save money. One solution that has gained popularity in recent years is energy services performance contracting (ESPC).
What is Energy Services Performance Contracting?
ESPC is a comprehensive program that allows businesses and organizations to upgrade their energy systems and infrastructure without incurring any upfront costs. The program is designed to finance, design, implement, and monitor energy-efficient improvements that result in measurable cost savings and improved energy efficiency.
Under an ESPC agreement, an energy services company (ESCO) is contracted to conduct a comprehensive energy audit of an organization`s facilities to identify areas where energy savings can be achieved. The ESCO then develops a customized plan that outlines the recommended energy-efficient upgrades, including equipment replacement, retrofits, and building enhancements.
Once the plan is approved, the ESCO finances and implements the upgrades, typically using third-party financing or investment-grade energy savings performance contracts (ESPCs). The organization repays the financing over time, typically through the energy cost savings generated by the upgrades.
Benefits of Energy Services Performance Contracting
ESPC offers several benefits for businesses and organizations, including:
1. Cost Savings
ESPC allows businesses and organizations to enjoy immediate cost savings, as the upgrades are designed to reduce energy consumption and utility bills. The savings generated typically cover the cost of the financing, resulting in zero upfront costs and no additional debt.
2. Improved Energy Efficiency
ESPC upgrades improve energy efficiency, resulting in long-term savings and reduced carbon emissions. The program is designed to generate measurable energy savings of at least 15%, and many businesses and organizations have achieved even greater savings.
3. Comprehensive Solution
ESPC offers a comprehensive solution that includes energy audits, design, implementation, and monitoring, all provided by experienced professionals. This turnkey solution ensures that businesses and organizations achieve maximum energy savings and ensures that the upgrades are properly installed and maintained.
4. Increased Property Value
ESPC upgrades can increase the value of a property by improving its energy efficiency and reducing its carbon footprint. This is especially important for organizations that own or lease commercial property, as it can increase the property`s resale or rental value.
In conclusion, energy services performance contracting is an effective way for businesses and organizations to reduce energy consumption and save money while improving their carbon footprint. With the help of experienced professionals, businesses and organizations can take advantage of this comprehensive solution to achieve immediate and long-term benefits.