For large institutions that need significant energy efficiency upgrades, an energy service contract can solve financing issues. In these situations, the service provider does the work and is paid with the energy savings that it creates. A new report from Navigant Research predicts that the market opportunity for energy service companies (ESCOs) and energy performance contracting (EPC), will increase from $6.3 billion in 2015 to $11.5 billion in 2024. Such contracts can be very beneficial for institutions struggling to finance energy efficiency upgrades. For example, the University of Illinois at Chicago signed a $63.6 million energy savings performance contract with Ameresco, Farmington, MA. The budget-neutral project saves the University more than $1.8 million in avoided energy costs annually for 20 years, through energy efficiency and infrastructure upgrades to the Science and Engineering departments on the campus Laboratories Complex. It’s a big project, with four teaching and laboratory buildings, and an office building, exceeding 1.2 million square feet. Along with infrastructure upgrades, energy conservation measures include: new and recommissioned air handling units, HVAC control systems and equipment, chilled beams, high-performance fume hoods, lighting retrofits, weatherization of building envelope, and the installation of energy recovery systems. As an added bonus, the project helps the University reach its goal of carbon emission reductions 80% by 2050.
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