Energy Savings Performance Contracting (ESPC)
Energy Savings Performance Contracts (ESPCs) allow federal agencies to procure energy savings and facility improvements without any upfront capital costs. An ESPC is a partnership between a federal agency and an Energy Service Company (ESCO). When managed properly, an ESPC can be a very effective and innovative tool to utilize to get work done within your facilities, while also helping to mitigate your overall risk. However, there are some critical factors to consider, such as:
- What legislation is involved? In order to be in compliance with applicable federal rules and guideline, a certain protocol must be adhered to when exploring an ESPC; advertisements must occur, time-lines must be adhered to, certain public entities notified as well as numerous other requirements.
Answer – TFS Alliance Group has been involved with a very large number of ESPCs over the last 15+ years, from as small as $250,000 to as large as $25,000,000. We are extremely knowledgeable of this procurement tool and can advise you on how to navigate through the entire process, from drafting the necessary RFP, to ESCO selection, to project close-out.
- Will there be competition for your project? All too often, if one particular ESCO is leading a project or has already gained access to facilities, other providers tend to back away from dedicating any time or resources which leads to an understandable lack of interest by other ESCOs.
Answer – Having been in the industry for over 15 years, TFS Alliance Group is aware of and recognized by all of the various ESCOs in the industry. Potential ESPC providers will immediately recognize that there is an independent and “unbiased” 3rd party advising the client through this process. As a result, ESCOs will be much more likely to dedicate the necessary time, resources and money required to create and submit a response to an RFP thus, increasing the overall competition for your projects.
- Which ESCO is right for you? There are numerous ESPC providers in the market and each possesses unique attributes. When attempting to choose the best qualified, how will you know you’re making the right choice?
Answer – By utilizing a detailed and methodical approach to the selection process, an educated decision on which provider to partner with can be made on completely subjective criteria. TFS Alliance Group helps owners by managing the entire selection process and introduces a new strategy for obtaining the information necessary to make an informed decision.
- Now that the project has been agreed to, who will oversee the construction of the project? Yes, ESPC providers will say that they offer and will include Project Management services; however, that is much more related to managing their best interests and bottom line.
Answer – It’s critical that you have an independent 3rd party involved and overseeing the implementation. TFS Alliance Group has been involved with numerous multi-million dollar facility projects and has the experience necessary to ensure the project goes smoothly and who will be there to advocate on your behalf, from the 1st day of construction, all the way to project close-out.
In summary – Your facilities are incredibly valuable and it’s absolutely critical that you maintain them! An ESPC can be a very effective way of addressing particular facility renewal needs IF managed properly. By engaging TFS Alliance Group as your owner’s representative, you will be introducing a new component of transparency and fairness to the entire selection process for any ESPC that you may be contemplating. All stakeholders (community, boards, committees, groups,…) involved will realize and appreciate that the building owner has acted on their best behalf by partnering with an independent and unbiased 3rd party to help ensure the implementation of a highly successful construction project.