Third Party Financing ESPC/UESC/ENABLE

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1 Third Party Financing ESPC/UESC/ENABLE Make Energy a Consideration in All We Do Mr. Les Martin Chief, Program Development Branch Air Force Civil Engineer Center-East (AFCEC-E)

2 Purpose Overview Energy Savings Performance Contract (ESPC) Utility Energy Service Contract (UESC) ESPC ENABLE Summary 2

3 Overview Energy Savings Performance Contracts ($30+M) Air Force (AF), Corps of Engineers (CoE), Defense Logistics Agency (DLA) Goal of $419M before end of CY16 DOE FEMP IDIQ (Basic Contract), CoE MATOC Objective of ESPC is to save ENERGY!!!! Utility Energy Service Contracts ($10-30M) Base Contracting Officer Subject to utility provider interest Must use GSA Areawide Contract if available ENABLE ($1-10m) Smaller projects, limited ECMs including lighting, water fixtures, basic HVAC controls, HVAC replacement and Solar PV Think of it as ESPC Lite 3

4 Energy Savings Performance Contract (ESPC) ESPC: a contract in which the Energy Services Company (ESCO) arranges financing, designs, implements, operates, maintains and owns infrastructure improvements that increase the efficiency of energy consuming systems Third party can use incentives/tax credits/rebates Guaranteed energy savings Facility energy, process energy and data centers Legal Authority: 42 USC 8287 and 10 CFR 436 Dollar amounts: no limits Restrictions/Limits: aggregate annual payments may not exceed amount that would have been paid for utilities and O&M without ESPC/up to 25-year financed term Challenges: complicated financial agreement Focus Use: large scale, utility meter needle moving projects 4

5 Utility Energy Savings Contract (UESC) UESC: a contract in which the Utility Company arranges financing, designs, implements, operates, maintains and owns infrastructure improvements that increase the efficiency of energy consuming systems Sole sourced with servicing utility company (must compete multiple servicing utilities) Financed or direct funded Takes advantage of incentive/tax rebate programs M&V not required, but may be desired Energy savings not guaranteed only equipment performance guaranteed Legal Authority: 42 USC 8256 and 10 USC Restrictions/Limits: Financed term limited to 25 years to include construction Performance guaranteed, not energy savings 5

6 ESPC ENABLE Overview ESPC ENABLE is a new third party investment program: Smaller scoped ESPC Opportunities Intended for Federal facilities with buildings under 200,000 square feet Standardized/streamlined process to award projects and realize savings using GSA Schedule 84, SIN Targets straight-forward ECMs including lighting, water fixtures, HVAC controls, HVAC equipment and Solar PV Prescribes basic levels of measurement and verification (M&V) for each ECM 6

7 Benefits Saves energy (meets mandated goals) No cost infrastructure improvements Costs no more than what the AF pays today Limited base manpower required AF retains equipment at end of contract Environmental benefits Reduces greenhouse gas emissions No AF funds needed to implement AF pays based on savings/performance guarantee 7

8 Benefits Contractor provides Upfront funding Energy audits, identifies opportunities Construction / implementation Operations and maintenance Long-term partnership Contract term up to 25 years Savings or Performance-based payments 8 AFCEC resources are available Core of expertise in place (SMEs, ACQ, JA) Access to DoE and MATCO ESPC contracts

9 Summary Meet Energy Consumption Mandates from Energy Strategy Maximize energy/water cost reductions for future Optimize the team Installation AFCEC HAF and OSD FEMP AFICA DLA CoE Industry 9

10 QUESTIONS? 10