Energy Savings Performance Contracts

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  • The majority of the savings are passed along to the ESCO in the form of the annual payment.  Btu savings per dollar: an inflation adjusted (6700) OR historical (7200) Btu savings per dollar. 
  • Energy Savings Performance Contracts

    1. 1. 1 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name Energy Savings Performance Contracts Southeast Sustainability Summit August 21, 2013 Julia Kelley Group Leader Residential, Commercial and Industrial Energy Efficiency
    2. 2. 2 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name What we’ll cover • What is an Energy Savings Performance Contract (ESPC) • Who Uses ESPCs? • Explanation of DOE and ORNL involvement in ESPCs • ESPCs in the Southeast – News and Examples • How do energy efficient technology vendors engage?
    3. 3. 3 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name What we’ll cover • What is an Energy Savings Performance Contract (ESPC) • Who Uses ESPCs? • Explanation of DOE and ORNL involvement in ESPCs • ESPCs in the Southeast – News and Examples • How do energy efficient technology vendors engage? • How can the public sector encourage ESPCs in your state or city?
    4. 4. 4 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name What is an ESPC? An Energy Savings Performance Contract (ESPC) allows Federal agencies to procure facility energy improvements: • with no up-front capital cost and, • without special appropriations from Congress
    5. 5. 5 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name ESCO and Agency Roles • An Energy Services Company (ESCO) – designs and constructs the energy project – obtains financing to cover costs – guarantees cost savings to cover payments over contract term • The Agency: – Negotiates and awards task order – Pays for the project over time from savings generated from improvement
    6. 6. 6 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name The Difference Between Federal ESPCs and Conventional Design/Build Process • Financing - maximum contract terms – 25 years • Cost savings guaranteed to exceed payments • Performance of installed energy conservation measures (ECMs) is guaranteed • ESCO is often responsible for O&M • Measurement and verification of savings is required
    7. 7. 7 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name ESPC Payments • Key: ESPCs are budget neutral • ESPCs are paid from savings – guaranteed $ Energy + O&M Cost Savings Before ESPC Contract During ESPC Contract After ESPC Contract Utility Bill + Energy Related O&M ESPCs: Why the interest? Utility Bill + Energy Related O&M Utility Bill + Energy Related O&M Payments to ESCO Savings Excess Savings
    8. 8. 8 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name Energy Conservation Measures (ECMs) In all Technology Categories • Boiler and chiller plants • Energy management control systems • Building envelope • HVAC • Chilled/hot water and steam distribution • Lighting • Electric motors and drives • Refrigeration • Distributed generation
    9. 9. 9 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name Energy Conservation Measures (ECMs) in All Technology Categories • Renewable energy • Energy/utility distribution • Water and sewer • Electrical peak shaving/load shifting • Rate adjustments • Energy-related process improvements • Commissioning • Advanced metering • Appliance/plug load reductions
    10. 10. 10 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name What we’ll cover • What is an Energy Savings Performance Contract (ESPC) • Who Uses ESPCs? • Explanation of DOE and ORNL involvement in ESPCs • ESPCs in the Southeast – News and Examples • How do energy efficient technology vendors engage?
    11. 11. 11 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name Who uses ESPCs? • Public sector including: – Federal government – School districts – Municipalities – State government – Universities • Available to private sector but . . . . – Not as popular in the private sector – Want a faster payback – Some high profile private ESPCs – including Empire State Building
    12. 12. 12 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name What we’ll cover • What is an Energy Savings Performance Contract (ESPC) • Who Uses ESPCs? • Explanation of DOE and ORNL involvement in ESPCs • ESPCs in the Southeast – News and Examples • How do energy efficient technology vendors engage?
    13. 13. 13 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name DOE’s Federal Energy Management Program Mission – FEMP works with key individuals to accomplish energy change within organizations by bringing expertise from all levels of project and policy implementation to enable Federal Agencies to meet energy-related goals and to provide energy leadership to the country.
    14. 14. 14 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name FEMP Support of ESPCs in federal sector • Developed and Manages IDIQ Contract with ESCOS for ESPCS for all federal agencies to use • Assigns project facilitators to ESPC projects • Offers Renewable Energy and Advanced Technologies Planning and assistance to federal sites • Provides ESPC training
    15. 15. 15 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name What we’ll cover • What is an Energy Savings Performance Contract (ESPC) • Who Uses ESPCs? • Explanation of DOE and ORNL involvement in ESPCs • ESPCs in the Southeast – News and Examples • How do energy efficient technology vendors engage?
    16. 16. 16 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name North Carolina – ESPC project example • Appalachian State University – campus-wide renovation for campus in Boone just announced in July • $16.5 million project • Includes: – Heating and air-conditioning upgrades – Lighting upgrades – Water conservation upgrades • Will employ up to 266 workers over a 22-month construction period • 13 year pay-back for project
    17. 17. 17 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name SE Energy Savings Performance Contracting Dollars per capita • Source: Energy Services Coalition • Estimated amount of ESPC investments in state and local buildings as reported Boxes: Total Investment in Performance Contracting in Millions
    18. 18. 18 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name ESPC by State – Enabling Legislation • Visit: – http://web.ornl.gov/info/esco/legislation/newesco.shtml • Includes clickable map with – State energy program web sites – Citations and links to state enabling legislation for performance contracting – Information on public sector applicable areas • School districts • Municipalities • State colleges and universities counties • State • Any public agency • Let us know if your state info needs updating
    19. 19. 19 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name What we’ll cover • What is an Energy Savings Performance Contract (ESPC) • Who Uses ESPCs? • Explanation of DOE and ORNL involvement in ESPCs • ESPCs in the Southeast – News and Examples • How do energy efficient technology vendors engage?
    20. 20. 20 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name How do energy efficient technology vendors engage? • It’s the ESCO that purchases the equipment for the project • National Association of Energy Service Companies – www.naesco.org – Site includes “finding a provider”, market analysis, etc. – 2013 NAESCO 30th Annual Conference, Nov. 12-14 in Orlando, FL
    21. 21. 21 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name FEMP Info for technology vendors • List of ESCOs that have competed and been awarded a master DOE ESPC contract • List of ESCOs that have been screened by a qualifications review board of federal agencies http://www1.eere.energy.gov/femp/financing/espcs_companies.html • Guide on Selling Energy-Efficient Products to the Federal Government – http://www1.eere.energy.gov/femp/pdfs/selling_eeproducts_to_ gov.pdf • Doing business with the federal government fact sheet – http://www1.eere.energy.gov/femp/pdfs/doing_business_with_g ov.pdf
    22. 22. 22 Managed by UT-Battelle for the U.S. Department of Energy Presentation_name Julia Kelley Phone: 865-574-1013 Email: kelleyjs@ornl.gov

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