Energy savings performance contracts

Energy Savings Performance Contracts (ESPCs) are agreements between a facility owner and an energy service company (ESCO) to improve energy efficiency. The ESCO conducts an energy audit, identifies areas for savings, and implements upgrades, such as better lighting or insulation, at no upfront cost to the owner. The ESCO recoups its investment through a share of the cost savings generated over time. This arrangement helps organizations reduce energy consumption and costs while minimizing financial risk, as the savings are guaranteed, making it a win-win situation for both parties involved.