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Energy Savings Performance Contracting
Presented by David J. Anderson, Executive Vice President
October 21, 2009
The 2009 New Jersey Clean Energy Conference and Leadership Awards
Presentation Overview Introduction
Energy Savings Performance Contracting (ESPC) – What is ESPC?
– Are you a Good Candidate?
– What can ESPC Accomplish?
The Steps of An ESPC?
Case Studies
Benefits of ESPC
Introduction
Nation’s Largest Independent Energy Solutions Company
Over 30 years of experience managing energy usage, supply and assets – Implemented over $4 billion
of energy solutions – NJ DPMC Certified as an ESCO (C036) – First NAESCO Accredited Energy Services
Provider – US DOE Qualified Energy Services Provider
Over 650 employees in 54 offices throughout North America
Focused: Energy Services and Renewable Solutions are all we do!
Vendor-Neutral: Ameresco is not a manufacturer. We recommend the equipment and systems that are in the best interest of our clients, then procure them competitively.
Fuel-Neutral: We are not a subsidiary of a utility. We objectively develop fuel-switching, cogeneration and renewable energy opportunities for our clients when applicable.
Experienced: Awarded more than 600 energy savings performance contracting projects.
Dedicated: Committed to 100% customer satisfaction.
Our Core Business
Services and Solution Options Energy Savings Performance Contracts include energy efficiency and may incorporate any one or all of the following:
NJ and Regional Customers (Partial Listing)
Rutgers University, NJ Fort Monmouth, NJ McGuire Air Force Base, NJ Reckitt Benckiser Center for
Innovation, NJ Camden Public Schools, NJ Northern Valley High School, NJ Patchogue Medford High School,
NJ Simon Properties, NJ
– Menlo Park Mall – Newport Centre Mall
Huntington Union Free School District, NY
Clarkstown Central School District, NY
New York City Housing Authority, NY
Dept. Military & Veterans Affairs - State Armories, PA
Big Spring School District, PA US Naval Station,
Philadelphia, PA State Correctional Institution
Dallas, PA Dept General Services;
Regional Office Buildings, PA Clarks Summit State Hospital,
PA
Energy Savings Performance Contracting (ESPC)
Energy Costs
What is Performance Contracting?
Energy Savings Performance Contracting (ESPC) is a technique that uses utility cost savings to reinvest into the facility or property that covers the cost of improvement within a specified period of time.
All institutional, commercial and industrial building owners/managers can use an ESPC to address their portfolios.
Before Improvements
After Improvements
Maintenance Costs
Savings Repay Improvements
Are You a Good Candidate for ESPC?
High operating costs. Aging buildings and equipment in need of
modernization. Decreased asset value. Lack of in-house personnel expertise/availability to
address facility needs. Constrained capital budgets, or no desire to deploy
capital for building upgrades and improvements.
What Can ESPC Accomplish?
Significant reduction in utility expenses of up to 30%. Infrastructure modernization
– Installation of new energy related equipment/systems. – Incorporation of capital improvements.
Equipment inventory consistency. Better management and tracking of energy use. Shift risk of delivery and performance from property owner to
ESCO. Environmental Stewardship – mitigation of greenhouse gases Implemented with no up-front capital costs and guaranteed
savings for the project term.
The Steps of An ESPC
Model Project Options
Project Meeting
Customer Criteria?
ESA Executed
?
DETAILED EVALUATION
N N
Y Y Conduct Detailed
Evaluation Study
Prepare Energy
Services Agreement
Collect Fee
Development Phase
Establish a baseline for energy use and cost.
Confirm Investment/business criteria.
Identify and evaluate specific utility and maintenance savings opportunities.
Determine final composition of energy efficiency and infrastructure improvements.
Costs for engineering rolled forward into project implementation.
Execute ESA and secure project financing.
Implementation Phase
Procure/award design and construction contracts.
Manage the installation and commissioning of the project.
Train staff and provide on-going maintenance service, applicable.
Commissioning and savings performance test conducted at construction completion to obtain customer acceptance.
Maintain performance and verify savings to reconcile guarantee.
Administer Project
Design & Construction
DESIGN, CONSTRUCTION AND PERFORMANCE
N
Y Execute Design/ Build
Contracts
Draw Permanent Financing
Project Acceptance Executed?
Performance Services
Case Studies
Case Study 1: 67 Properties; 5,269 Units Overview of Improvements
$(000) Utility Spend
Total Savings
% Saved
Total $15,540 $4,265 27%
Electric $5,152 $1,992 38% Gas $1,953 $407 21% Water $3,702 $973 26% Allowances $4,733 $892 19%
Project Costs and Savings Summary Project Parameters
20 Year Cash Flow
Case Study 2
Two Correction Facilities and a Highway Patrol Administration Building; 1,071,000 sq. ft.
Energy Savings Performance Contract – $4,533,071 – Annual Savings of $500,000 a year – 15 year Term
Overview of Improvements – 3.2MW of LFGTE Cogeneration
Electric Power Sold to the City Electric Cooperative
Waste Heat Generated to Provide Hot Water and Steam
– Lighting – Energy Management Controls – Steam Traps – Central Plant Improvements
Benefits of ESPC
Benefits of ESPC Eliminates need for up-front capital. Fund project entirely from savings. Reduces facility utility demand requirements. Modernizes facility infrastructure and increases asset value. Mitigation of green house gases. Single point of responsibility. Provides protection against future rate increases and market
volatility. ESCO assumes implementation cost and savings performance
risks. – Fixed cost – Guaranteed energy savings
David J. Anderson Executive Vice President 111 Speen St., Suite 410 Framingham, MA 01701
(508) 661-2200 www.ameresco.com
Thank You
