SEMINAR HIJAU
THE PRACTICAL STEPS AND KEY
CRITERIA IN ENERGY PERFORMANCE
CONTRACTING
Zaini Abdul Wahab
MAESCO
4th July 201...
Outline
1. EPC Market Potentials
2. The Practical Steps & Key Success Factors
For Successful EPC Projects
Implementation
3...
Shared Saving Mechanism
Adaptation from US Dept. of Energy, Measurement & Verification Guidelines, Version 3.0,
time
(year...
Guaranteed Savings Model
FACILITIE
S OWNER
ESCOBANK
Project Design&
Implementation
Project FeesLoan
Repayment
Shared-Savings Model
FACILITI
ES
OWNER
ESCOBANK
Project Design&
Implementation
Loan
Repayment
EE
PROJECT
Energy saving sha...
Energy Efficiency Market & Potentials in SEA
Source: www.reexasia.com
Saving Potentials (USD) in SEA
Clearly, the industrial and
commercial sector s offers
much higher savings potential
Source...
EPC MARKET POTENTIALS IN MALAYSIA
Biggest Electricity Users For Government
Buildings (Sep 2009-Oct 2010)
Hospitals, 20%
Universities,
29%
Ministries,
19%
Ot...
EPC Market Potentials : Melaka
No. Building
Total Electricity
Bill
(RM/year)
Total
Consumption
(kWh/year)
1 Melaka Mall Co...
Potential Areas For EPC Projects
EPC Potentials : A Building Facilities in Melaka
NO. Item
MOTOR
RUNNING
NORMAL MODE ENERGY SAVING MODE
( Rated
kW )
( Runn...
EPC Potential:
Shopping Complex in Melaka
• Total Lighting Saving = RM 116,253
• Total Maintenance Saving = RM 44,768
• To...
The Practical Steps & Key
Success Factors For Successful
EPC Projects Implementation
The Key Steps
Confirm The Need!
Understanding on EPC concept by the
building owner
The needs to adopt EPC model
Self assessment
Comp...
Scope of Services under EPC
Project Funding & Financing Options
Engineering & Economic Feasibility Studies
Project Desi...
Preparation
Facility Profile
 Basic building information
 Floors & areas
 M&E equipment & system data
 Building mater...
Prequalification of ESCOs
Qualifying criteria
Own criteria – must consider the nature of
ESCO business for EPC
MAESCO’ ...
Selection of ESCOs
Experiences in
EPC/Track Records
in energy services
Financial
Strengths
Management
capacity in
energy s...
Issue Request for Proposal
Evaluation of Proposals
Example: Evaluation Score Sheet
Detailed Energy Audit
Investment Grade
Energy Audit
Owner’s roles
Scope & schedule
Findings
 Energy saving
potentials...
EPC Contract Document
 Drafted by JKR for government buildings as reference
 To be customized based on requirements of e...
Project Implementation
EPC Contract
Negotiation &
Signing
Install
permanent
sub-meters
Collect energy
data to
establish
en...
Measurement, Monitoring &
Verification
For actual savings achieved
Methodology/Protocol
Baselines agreed
Permanent met...
Options For
Energy Baseline & Saving Calculation
Method Advantages Disadvantages
Utility billing history Low cost •Effect...
Baseline:
Baseline year from electricity bill data (kWh)
(kWh)
Example:
Energy saving calculated by the difference between a
baseline year and a subsequent year from electricity bill
(k...
Baseline : Building Monthly Load Profile (kW) from sub-metering
31
Baseline :
Building monthly electricity consumption profile(kWh) from sub-metering
32
Baseline :
Building monthly load profile(kW) for AHU from sub-metering
33
Baseline :
Monthly electricity consumption profile(kWh) for AHU from sub-metering
34
Example: Savings calculated based on actual
measurement from sub-meters
Modifying/Reviewing Baseline
 To establish standards for “Materials”
changes which may reasonable expected
to change ener...
Example: Monitoring & Measurements for Air
Conditioning System
Your Energy Management
Specialist &
37
(Before) Conventional FL 36W (After) HP T8-28W
Example : Before & After Implementation
EPC Success Stories:USA
ESCO Fund:Thailand
EPC Success Stories: Malaysia
Source: ESCO
THE WAY FORWARD
 Capacity building for ESCOs and building operators
 to enhance competencies in energy saving projects i...
Thank you for your time & attention!
• secretary@maesco.org.my
• 019 2152700
• www.maesco.org.my
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Key Steps and Success Factors in EPC Implementation

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A revised version on EPC Guideline for implementation for government buildings

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Key Steps and Success Factors in EPC Implementation

  1. 1. SEMINAR HIJAU THE PRACTICAL STEPS AND KEY CRITERIA IN ENERGY PERFORMANCE CONTRACTING Zaini Abdul Wahab MAESCO 4th July 2013 Hotel Seri Malaysia, Ayer Keroh Melaka
  2. 2. Outline 1. EPC Market Potentials 2. The Practical Steps & Key Success Factors For Successful EPC Projects Implementation 3. EPC Success Stories 4. The Way Forward
  3. 3. Shared Saving Mechanism Adaptation from US Dept. of Energy, Measurement & Verification Guidelines, Version 3.0, time (year) Energy Bills During contract period Lower Energy Bill After Contract period Energy bill saved Before Contract Period Electricity bill before energy saving measures implementation Payment to ESCO Savings for the client Baseline Lower Energy Bill Savings for the client Implement EMSDevelop & Plan EMS
  4. 4. Guaranteed Savings Model FACILITIE S OWNER ESCOBANK Project Design& Implementation Project FeesLoan Repayment
  5. 5. Shared-Savings Model FACILITI ES OWNER ESCOBANK Project Design& Implementation Loan Repayment EE PROJECT Energy saving share (90%-70%) Financing Energy saving share (10%-30%)
  6. 6. Energy Efficiency Market & Potentials in SEA Source: www.reexasia.com
  7. 7. Saving Potentials (USD) in SEA Clearly, the industrial and commercial sector s offers much higher savings potential Source: www.reexasia.com
  8. 8. EPC MARKET POTENTIALS IN MALAYSIA
  9. 9. Biggest Electricity Users For Government Buildings (Sep 2009-Oct 2010) Hospitals, 20% Universities, 29% Ministries, 19% Others (States, Agencies), 32% Building Nos Total Consumption (kWh/year) Total Bill (RM/year) Hospitals 22 367,587,657 130,640,653 Universities 25 543,961,738 193,324,002 Ministries 25 360,592,831 128,154,692 Others(States, Agencies) 56 603,464,085 214,471,136 128 1,875,606,311 666,590,483 Estimated Total TNB Bill for government buildings (Sep 2010-Aug 2011) Total Consumption(kWh/year) Total Bill(RM/year) 7,896,508,329 2,726,767,394 10% saving equals to about RM270 millions /year Source:KeTTHA
  10. 10. EPC Market Potentials : Melaka No. Building Total Electricity Bill (RM/year) Total Consumption (kWh/year) 1 Melaka Mall Complex Ayer Keroh 2,018,339 6,469,034 2 Seri Negeri Chief Minister Department , Ayer Keroh 1,435,728 4,601,693 3 MITC Complex, Ayer Keroh 980,085 3,141,299 4 Wisma Negeri Building Ayer Keroh 1,095,472 2,547,610 5 Graha Maju Building, Jln Hang Tuah 674,267 2,161,113 6 Wisma PKMM Building, Ayer Keroh 646,924 2,073,473 7 Digital Mall, Jln Hang Tuah 550,110 1,763,174 8 Melaka Sentral Terminal Peringgit 735,193 1,709,750 9 Putra Specialist Hospital 2,858,772 1,905,848 Total 10,994,890 26,372,994 Source: JIMAT
  11. 11. Potential Areas For EPC Projects
  12. 12. EPC Potentials : A Building Facilities in Melaka NO. Item MOTOR RUNNING NORMAL MODE ENERGY SAVING MODE ( Rated kW ) ( Running kW ) kWh/Year Rate/Year (RM) Amount (kWh) Rate/Year (RM) SAVING (%) SAVING (RM/Year) 1 CHWP 1 18.5 19.1 165,024 70,960 107,266 46,124 35% 24,836 Old Block Chiller Room 2 CHWP 2 18.5 19.0 164,160 70,589 106,704 45,883 35% 24,706 New Block Chiller Room 3 CDWP 1 15 13.3 114,912 49,412 82,737 35,577 28% 13,835 Old Block Chiller Room 4 CDWP 2 18.5 15.3 132,192 56,843 95,178 40,927 28% 15,916 New Block Chiller Room Sub-Total 67 576,288 247,804 391,884 168,510 32% 79,294 No Item Rated (kW) Actual kW Normal kWh/Year Saving Mode kWh/Year Saving % Saving kWh Saving (RM/Year) 1 Chiller – Old Blk 210 128 1,105,920 995,328 10% 427,991 47,555 2 Chiller– New Blk 210 115 993,600 914,112 8% 393,068 34,180 Sub-Total 420 243 2,099,520 1,909,440 9.1% 821,059 81,734 TOTAL HVAC SAVING 161,028 Source: ESCO
  13. 13. EPC Potential: Shopping Complex in Melaka • Total Lighting Saving = RM 116,253 • Total Maintenance Saving = RM 44,768 • Total Saving for HVAC = RM 270,231 • Total Annual Savings = RM 431,252 18% from total annual electricity bill (Nov 2012-Feb 2013) Source: ESCO
  14. 14. The Practical Steps & Key Success Factors For Successful EPC Projects Implementation
  15. 15. The Key Steps
  16. 16. Confirm The Need! Understanding on EPC concept by the building owner The needs to adopt EPC model Self assessment Comparing energy benchmark Estimation of project costs & saving potentials Private investment & Risks transfer to ESCO - viable sharing ratio/% Opened or Closed Tender?
  17. 17. Scope of Services under EPC Project Funding & Financing Options Engineering & Economic Feasibility Studies Project Design, Engineering & Permitting Project Construction Project Commissioning Operation, spare parts & Maintenance Performance measurements & monitoring
  18. 18. Preparation Facility Profile  Basic building information  Floors & areas  M&E equipment & system data  Building materials information & data  Energy consumption Define project & preliminary scope Evaluation criteria  ESCOs  EPC Project Proposals
  19. 19. Prequalification of ESCOs Qualifying criteria Own criteria – must consider the nature of ESCO business for EPC MAESCO’ s /International guidelines Current criteria by ST is insufficient to determine the financial & technical capabilities of registered ESCOs Identify Potential ESCOs
  20. 20. Selection of ESCOs Experiences in EPC/Track Records in energy services Financial Strengths Management capacity in energy services Technical Competency & Expertise ESCO To secure financing & ensure sustainable operations
  21. 21. Issue Request for Proposal
  22. 22. Evaluation of Proposals
  23. 23. Example: Evaluation Score Sheet
  24. 24. Detailed Energy Audit Investment Grade Energy Audit Owner’s roles Scope & schedule Findings  Energy saving potentials analysis  Projected annual cash flow  Measurement, Monitoring & Verification of actual savings
  25. 25. EPC Contract Document  Drafted by JKR for government buildings as reference  To be customized based on requirements of each building owner  Factors should be considered to reduce dispute in EPC Contract  Obligations of owners & ESCOs  Factors affecting savings performance  Valuating savings uncertainty  Minimum operating conditions  Energy prices/tariff rates  Verification by A third party  Baseline modification/review(non-routine)  Balancing uncertainty and costs  Protection from risks by both parties
  26. 26. Project Implementation EPC Contract Negotiation & Signing Install permanent sub-meters Collect energy data to establish energy baseline values Improve & optimize energy consumption with proposed saving measures Measure & monitor actual energy savings achieved against agreed baseline values
  27. 27. Measurement, Monitoring & Verification For actual savings achieved Methodology/Protocol Baselines agreed Permanent metering (highly recommended)
  28. 28. Options For Energy Baseline & Saving Calculation Method Advantages Disadvantages Utility billing history Low cost •Effects of weather , occupancy, other changes may mask savings •May be unreliable unless savings are significant compared to normal bill variation Data already available Independent data Represent all effects of ESMs Account for interactive effects System/Equipment sub-metering Isolate effects of ESMs •Higher cost •Misses interactive effects Very accurate for lighting measures Results are more predictable(low risk)
  29. 29. Baseline: Baseline year from electricity bill data (kWh) (kWh)
  30. 30. Example: Energy saving calculated by the difference between a baseline year and a subsequent year from electricity bill (kWh)
  31. 31. Baseline : Building Monthly Load Profile (kW) from sub-metering 31
  32. 32. Baseline : Building monthly electricity consumption profile(kWh) from sub-metering 32
  33. 33. Baseline : Building monthly load profile(kW) for AHU from sub-metering 33
  34. 34. Baseline : Monthly electricity consumption profile(kWh) for AHU from sub-metering 34
  35. 35. Example: Savings calculated based on actual measurement from sub-meters
  36. 36. Modifying/Reviewing Baseline  To establish standards for “Materials” changes which may reasonable expected to change energy consumption trend in the facility  Occupied square footage, operating hours  Facility’s energy equipment/operating parameters other than the ESCO equipment  Energy equipment, other than ESCO equipment, that malfunctions, or is repaired, or replaced in a manner that increases or decreases energy consumption;  Other actions taken by the facility owner that may reduce or increase energy use; and,  Discovery of an error in the original baseline, in which case the change would be retroactive Trust , good relationship & effective communication between ESCO & building owner is crucial to identify the needs to modify/review baseline!
  37. 37. Example: Monitoring & Measurements for Air Conditioning System Your Energy Management Specialist & 37
  38. 38. (Before) Conventional FL 36W (After) HP T8-28W Example : Before & After Implementation
  39. 39. EPC Success Stories:USA
  40. 40. ESCO Fund:Thailand
  41. 41. EPC Success Stories: Malaysia Source: ESCO
  42. 42. THE WAY FORWARD  Capacity building for ESCOs and building operators  to enhance competencies in energy saving projects implementation  Incentives/rewards/recognition for buildings which produced significant energy savings  To create motivation  Supports from banks with independent technical assessment from a competent agency for EPC project proposals for funding  To increase numbers & sizes of participation by ESCO & building owners  One-stop & competent agency for EPC project proposals evaluation & performance measurement & verification  Fiscal incentives for ESCOs & Business friendly procedures
  43. 43. Thank you for your time & attention! • secretary@maesco.org.my • 019 2152700 • www.maesco.org.my

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