How to make a financial analysis of an Energy Performance Contracting project financed by an ESCO compared to other financing mechanisms such as equipment leasing, direct investment from the municipal budget and others? Which financial performance indicators should be analysed and which values are considered acceptable in these type of projects? Which clauses related to the quality of service provided should be included in the contract?
These are only few out of many questions asked by the city of Trnava, Slovakia and the regional energy agency S.Energia, Portugal who have were able to get specific advice about their public buildings and street lighting Energy Performance Contracting (EPC) projects from the more experienced ESV, the Upper Austria Energy Agency. All three partners joined a test phase of the H2020 PROSPECT peer to peer learning programme and met during a study visit in Linz, Austria just before the Easter holiday.
We asked the participants what were the most useful and surprising things they have learnt.
The PROSPECT pilote group meeting in Linz. From left to right: Anja Gahleitner (ESV), Erika Balážová and Matúš Škvarka (City of Trnava), Jana Cicmanova (Energy Cities), Joan Barroso and Susana Camacho (S.Energia)
Susana Camacho, director of S.Energia energy agency said: “We are now more conscious of what we have to be careful about when developing the contract, like the guarantee clauses about the quality of the EPC service. We are also very much inspired by the ESV who is recognised by municipalities and the private sector as a regional ‘EPC facilitator’, increasing the trust in EPC. We will think about how to support our social organisations and citizens’ initiatives in their buildings retrofits via EPC contracts. And the most surprising for us was the fact that also small EPC projects are feasible and several funding sources can be blended with ESCO financing.”
Matúš Škvarka, energy manager of the city of Trnava will be “…more careful when considering EPC projects financed by an ESCO as other types of financing could be more relevant, especially for smaller projects. It could be useful but it has to be set up wisely. We now have a better idea on how to set an EPC contract criteria and conditions for our street lighting project and how to bundle different projects with different profitabilities. We were also inspired by the mission and work of local and regional energy agencies which are not very common in Slovakia but could bring benefits to cities and citizens.”
Anja Gahleitner from the Upper Austria Energy Agency who acted as a mentor in this learning programme appreciated the feed-back from the mentees: “It was interesting for me to see which parts of the study visit were the most interesting for mentees because our intention is to further improve our training module and train more and more participants in the future.”
Some 60 mentors and mentees applied for the first PROSPECT learning cycle starting in May this year. If you missed it but still want to learn more about EPCs and other innovative financing schemes through which you can implement your sustainable energy and climate plans, keep an eye on the project website, join the PROSPECT LinkedIn group and follow #H2020PROSPECT on Twitter – second learning cycle should start in September 2018 , with a call for applications opening in May-June!
Source: Energy Cities