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 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 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 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 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 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 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 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 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 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 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 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 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 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 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 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 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 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 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 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 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 Managed by UT-Battelle
for the U.S. Department of Energy Presentation_name
Julia Kelley
Phone: 865-574-1013
Email: kelleyjs@ornl.gov