Project cycle of EPC

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Project cycle of EPC

Taking into account that an EPC is the provision of energy services with guaranteed energy savings where all energy conservation measures are implemented by the ESCO and repaid from the resulting and achieved savings with no risk to the facility owner as the energy savings are contractually agreed. This could be demonstrated as in the Figure presented below.

Figure 4: The phases of an energy upgrade in the public sector.

Table 1: The basic phases of an EPC arrangement.

	PHASE 1. Selected buildings in need of EE upgrades are tendered Owner selects the buildings Authorized professionals (energy auditors) assess the facility Baseline Energy Consumption is calculated properly The required capital investment and the resulting savings potential are estimated
	PHASE 2. Procurement process of ESCO services is conducted Tender documents are prepared Tender is announced, and companies’ bids are submitted and evaluated Procurement process is conducted
	PHASE 3. Contract is awarded to ESCO with the winning bid The company with the best bid is awarded with the contract (the EPC) The parties agree on the guaranteed savings The parties agree on the funding model The parties agree on the contracting terms and period The winning ESCO signs the contract
	PHASE 4. Implementation of the energy conservation measures (ECMs) is done ESCO implements the ECMs included in the contract’s scope of works Testing and commissioning of the installed equipment ESCO trains the public institution owner’s personnel who will operate and maintain the installed equipment after the contract completion
	PHASE 5. Measurement and verification of the achieved savings conducted Annual assessment of the generated energy and O&M savings ESCO measures against indicators on a monthly basis and acts on any irregularity ESCO must cover any difference between the guaranteed savings and the actual achieved savings, in case the first are higher
	PHASE 6. The implemented measures are tested and commissioned Equipment is tested and commissioned ESCO provides trainings to the owner’s staff Owner signs all reception papers to the ESCO Owner enjoys better comfort conditions in the building
	PHASE 7. Contractual payments for performance (i.e., achieved savings) are done ESCO is remunerated based on the level of savings achieved ESCO is maintaining the installed equipment for the entire duration of the contract