By Shirley J. Hansen
Ebook via Hansen, Shirley J., Weisman, Jeannie C.
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Extra info for Performance contracting: expanding horizons
Energy efficiency can very likely save more money more quickly than any other measure to reduce pollution. Even if you do not have money to invest, now more than ever, the opportunity to have a more efficient operation is great. An entire industry designed to find the $120,000 hidden in your boiler, to reduce the 25% of your utility cost that goes to lighting, and find the resources willing to invest in those improvements, is here to serve your needs. The concept is simple. It is called performance contracting, a contract with payments based on performance.
This becomes particularly critical when there has been a change in administration or top management. Page 25 Figure 2-3. Cost Avoidance Graph Page 27 Chapter 3 The Fine Art of Solicitation And Selection A common lament from energy service companies (ESCOs), and those of us who help customers secure ESCO services is, Please figure out what you want to do first before the request for proposal (RFP)1 is issued. Second-guessing and changing intent in mid-stream create headaches for all. The costs to ESCOs, the frustrating time delays, the owner's cost of delay, the procedural (and legal) problems are legion.
The building owner did not necessarily receive any energy cost savings. Stories traveled and soon the trust vital to accepting a new concept, was badly shaken. Fortunately, many persisted in their efforts to make the new concept work. Some agreements continued to show savings benefits to both parties. Of even greater importance, some companies had guaranteed the savings and made good on those guarantees. In spite of this tenuous start, the shared savings industry survived, but its character changed dramatically.