PERFORMANCE CONTRACTING

WHY PERFORMANCE CONTRACTING? PERFORMANCE CONTRACTING ALLOWS YOU TO GREEN/UPGRADE YOUR FACILITIES AND PAY FOR THE UPGRADES WITH GUARANTEED AVOIDED COSTS IN ENERGY. NO INCREASE IN EXISTING BUDGETS OTHER THAN UTILITY COST INCREASES

OVERVIEW OF AN ESPC CONTRACT ENERGY SERVICES PERFORMANCE CONTRACTING –DGS CONTRACT # SRM FOR ALL PUBLIC BODIES –15 PRE-QUALIFIED ESCO’S –CONTACT 4 OR MORE FROM THE PRE-QUALIFIED POOL –ESCO’S MEET WITH YOU TO DISCUSS PROJECT –ESCO’S PERFORM A “BACK OF THE ENVELOPE” (BOE) AUDIT –INTERVIEW AND DISCUSS THE BOE AUDITS –SELECT 2 ESCO’S AND BEGIN NEGOTIATIONS. –SELECT 1 ESCO AS YOUR ENERGY PARTNER AND SIGN THE MOU FOR THE TECHNICAL AUDIT (TA) –UPON COMPLETION OF TA YOU DEFINE THE PROJECT –NEGOTIATE THE ENERGY CONTRACT –DMME SUPPORT THROUGHOUT THE PROCESS

HOW TO IMPLEMENT AN ESPC SUPPORT FROM ALL LEVELS OF MANAGEMENT CONSIDER YOUR FINANCING OPTIONS –PUBLIC BODIES VRA FINANCING MUNICIPAL BONDS LEASE PURCHASE THIRD PARTY FINANCING OUTRIGHT PURCHASE LEASE

HOW TO IMPLEMENT AN ESPC DEFINE YOUR PROJECT –WHAT ARE YOUR GREATEST NEEDS? OLD CHILLER THAT IS INEFFICIENT STEAM LINE LEAKS OR STEAM TRAPS HIGH ENERGY COSTS (ELECTRIC, HEATING FUELS, ETC.) HIGH WATER CONSUMPTION BUILDING ENVELOPE OLD BOILERS PM SOFTWARE PROGRAM OLD HVAC EQUIPMENT FREQUENCY DRIVES UTILITY TRACKING SOFTWARE LIGHTING ANY OTHER ENERGY RELATED PROJECT!!!

HOW TO IMPLEMENT AN ESPC AFTER YOU HAVE DEFINED YOUR NEEDS AND GIVEN CONSIDERATION TO HOW YOU WOULD LIKE TO FINANCE YOUR PROJECT… – SELECT A MINIMUM OF 4 CONTRACTORS TO PERFORM THE BOE AUDIT. –REFER TO CONTRACTOR QUALIFICATIONS AND SELECT BASED ON PROJECT NEEDS.

HOW TO IMPLEMENT AN ESPC SET UP A KICK-OFF MEETING/WALK THROUGH WITH THE SELECTED ESCO’S (INCLUDE ALL OF THEM AT THE SAME TIME) NEED TO PROVIDE THE ESCO’S CERTAIN INFORMATION –FACILITY DATA –UTILITY DATA –MAINTENANCE HISTORY

HOW TO IMPLEMENT AN ESPC SET A DEADLINE FOR THE BOE, REMEMBER THE MORE TIME YOU ALLOW THE BETTER THE INFORMATION (TYP 3-6 WEEKS) WHEN YOU RECEIVE THE BOE’S REVIEW THEM AND SET UP YOUR INTERVIEWS

HOW TO IMPLEMENT AN ESPC NEGOTIATE WITH 2 ESCO’S & SELECT 1 BASED ON ABILITIES, APPROACH, LONGTERM PARTNERSHIP, HISTORY, ETC SET UP A KICK OFF MEETING TO DISCUSS THE “TECHNICAL ENERGY AND WATER SAVINGS AUDIT” THE COST OF THE TECHNICAL AUDIT CAN BE ROLLED INTO YOUR ENERGY CONTRACT (COST CAN BE NEGOTIATED)

HOW TO IMPLEMENT AN ESPC ALLOW TIME FOR YOUR TECHNICAL AUDIT ONCE THE TECHNICAL AUDIT IS COMPLETE, MAKE SURE EVERYONE IS IN AGREEMENT WITH THE APPROACH TO THE PROJECT & PROJECTED COST AVOIDANCE IF EVERYTHING IS IN AGREEMENT PROCEED WITH THE ENERGY CONTRACT. IF YOU CHOSE NOT TO PROCEED THE ESCO IS PAID FOR THE NEGOTIATED COST OF THE TA. DMME IS AVAILABLE TO REVIEW PROJECT

PC FORMS FORMS ARE AVAILABLE –STATE CONTRACT –REQUEST FOR BOE –BUILDING BOE INFO FORMS –MOU FOR TA –SAMPLE CONTRACT –ESPC FORMSESPC FORMS

Q & A?

CONTACT INFO CHARLIE BARKSDALE CEM, CEP, CMVP, BEP, CSDP, VCCO UTILITIES & PERFORMANCE CONTRACTING MANAGER DEPARTMENT OF MINES, MINERALS & ENERGY