CHP Group Seminar - Paul Lewis - 28 June 2010


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  • Personal IntroductionCompany IntroductionAim to provide: energy savings reduce carbon emissions improve security of supply through decentralised generation and energy efficiency measures within an energy performance contract. Will explain how we offer this during the presentation.OverviewEnergy Objectives, how an ESCO operates and ESCO contractsESCO Solutions for CHP with a Self Energy case study
  • Organisations need to control their energy consumption and expenditure for above reasons.
  • ESCOs enable projects to progress that would otherwise not happen.
  • Energy efficiency can be achieved through implementing better technologies.Also, by changing occupants’ behaviour, once the true baseline energy services required are realised, then the optimum method of providing the energy for the end-uses can be determined.
  • ESCO contracts can be supply or performance based.
  • The energy performance contract is negotiated with the client so that both parties are satisfied. The terms of the contract will specify both financial and energy performance targets.
  • Self Energy performed a feasibility study for a large hotel. We determined a 512kW CHP unit to be a good solution to reduce their energy costs and reduce CO2 emissions.We formulated various proposals for the amount of equity Self Energy would provide.
  • The hotel had an energy bill of 1.3m. Investment required = 757k.The first solution was for the hotel to provide just 30k.
  • Gross savings and CO2 savings as shown.
  • The hotel makes savings as shown with payback of 2.7 years.
  • Alternative solution is the hotel investing 151k.
  • Same savings in energy and CO2 but hotel sees larger share.
  • Better overall financial savings for hotel but slightly longer payback period.
  • CHP Group Seminar - Paul Lewis - 28 June 2010

    1. 1. ESCO Solutions<br />Paul Lewis<br />CEO<br />Self Energy<br />Southbank Technopark<br />90 London Road<br />London SE1 6LN<br />+44 (0) 208 1444 348<br />CHP Group Seminar: 28 June 2010<br /><br />UK<br />
    2. 2. Energy Objectives<br />UK<br />Control and Reduce Energy CostsReduce exposure to external energy price volatility and reduce the cost of energy required to conduct business activities<br />Ensure Security of Power SupplyQuality, autonomy and security of consistent power<br />Retain Capital for Core Business ActivitiesA barrier to implementing energy saving technologies is the capital cost – this will prevent viable, economic projects being initiated<br />Carbon ReductionIncreasing legislation to reduce carbon emissions and pressure from customers, investors, management and staff to make changes in order to reduce carbon emissions<br />
    3. 3. The concept of an ESCO<br />UK<br />Overcome key barriers to implementation of decentralised energy (including CHP)<br /><ul><li> Project / performance risk appetite
    4. 4. Capital availability
    5. 5. Operation and maintenance expertise and capability</li></ul>Identification, feasibility and design of energy conservation measures<br />1. Energy efficiency <br />2. Cogeneration (CHP)<br />3. On-site renewable energy<br />
    6. 6. Technologies<br />UK<br />Energy efficiency + Cogeneration + On-site renewables<br />
    7. 7. ESCO Contracts<br />UK<br />Energy Supply Contract – <br />Supply of heat, power, cooling through a negotiated tariff<br /><ul><li> ESCO paid through supply of energy service
    8. 8. ESCO incentivised to deliver energy service</li></ul>Energy Performance Contract – <br />Guarantee particular level of service provision <br />(DHW, space heating, lighting, cooling, power etc)<br />Guarantee a measure of energy saving on existing levels<br /><ul><li> ESCO paid for through energy savings
    9. 9. ESCO incentivised to maximise energy savings
    10. 10. Suited for retrofit</li></li></ul><li>Energy Performance Contract<br />UK<br />Client<br />Client<br />Total Energy savings<br />Total Energy <br />consumption<br />During partnership<br />with ESCO<br />After<br />Before<br />Fixed term contract<br />Savings shared during the contract<br />Total customer benefit at the end of the contract<br />
    11. 11. Case Study: ESCO Solutions<br />UK<br />Example: 510kW CHP with Energy Efficiency measures<br />
    12. 12. Case Study: ESCO Solution A<br />UK<br />Example: 510kW CHP with energy efficiency measures<br />Total investment requirement: £757k<br /><ul><li>ESCO investment: £233k
    13. 13. Financing guaranteed by ESCO: £494k
    14. 14. Initial capital from the hotel: £30k
    15. 15. Length of partnership: 7 years</li></ul>Current energy bill: £1.3M/year<br />
    16. 16. Case Study: ESCO Solution A<br />UK<br />ESCO is rewarded on Net Savings<br /><ul><li>Gross Savings Forecast / year: £217k (17%)
    17. 17. Annual C02 savings: 947 tonnes (16.6%)</li></li></ul><li>Case Study: ESCO Solution A<br />UK<br /><ul><li>Energy Savings:£97k over 7 years</li></ul> £1.88M over 15 years<br /><ul><li>Payback for Hotel: 2.7 years</li></li></ul><li>Case Study: ESCO Solution B<br />UK<br />Example: 510kW CHP with energy efficiency measures<br />Total investment requirement: £757k<br /><ul><li>ESCO investment: £112k
    18. 18. Financing guaranteed by ESCO: £494k
    19. 19. Initial capital from the hotel: £151k
    20. 20. Length of partnership: 7 years</li></ul>Current energy bill: £1.3M/year<br />
    21. 21. Case Study: ESCO Solution B<br />UK<br />ESCO is rewarded on Net Savings<br /><ul><li>Gross Savings Forecast / year: £217k (17%)
    22. 22. Annual C02 savings: 947 tonnes (16.6%)</li></li></ul><li>Case Study: ESCO Solution B<br />UK<br /><ul><li>Energy savings:£246k over 7 years</li></ul> £2.03M over 15 years<br /><ul><li>Payback for hotel: 3.9 years</li></li></ul><li>Advantages of ESCOs<br />UK<br />ESCOs are ... <br /><ul><li>specialists in energy services (and the technologies used)
    23. 23. experts at identifying continued energy saving opportunities within an organisation</li></ul>ESCOs allow an organisation to ... <br /><ul><li>reduce energy costs
    24. 24. avoid technical and financial risk
    25. 25. concentrate their attention (and capital) on core business activities</li></li></ul><li>you save <br />energy<br />money<br />you save <br />you save the<br />environment<br />Q&A<br />UK<br />Paul Lewis<br /><br />+44 (0)20 8144 4348<br /><br />