Getting efficiency projects running through performance contracting

Panel: 6. Business models to improve industrial efficiency, global perspective

Author:
Patrick Fankhauser, SUSI Energy Efficiency AG, Switzerland

Abstract

Our Energy Efficiency Fund works with an alternative business model to finance energy efficiency projects through contracting solutions. We therefore would like to present our model at the conference. Our approach is based on energy performance contracting and works in the following way:

• First we identify projects that save energy and reduce CO2 emissions. These projects can be industrial, residential or governmental. Usually there already is an understanding on which measures will be carried out to save energy and which technological company will be responsible for the installation of the equipment. If not then we find an appropriate technology partner.

• We will then finance the project, neither the technological company nor the user of the equipment has to provide any cash.

• Once the project is running and energy is being saved, we receive part of the annual savings to pay off our investment over a period of up to 12 years.

• Once our investment is paid back, the facility owner fully owns the equipment and he can keep all the savings to himself from then on.

We believe that our approach offers a lot of potential, especially to get ee-projects on the way that otherwise would not be carried out due to a lack of funding or due to ambitious payback expectations. We would like to share our practical experiences and describe some of our typical projects. Elaborating upon the key points why certain projects succeed and others don’t will provide an interesting starting point for a discussion. Thereby we are also very keen to receive feedback from the other participants on their experiences and views regarding performance contracting.