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ENERGY PERFORMANCE
CONTRACT MODELS
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CONTRAC TYPE
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GUARANTEED SAVINGS
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SCHEME OF THE CONTRACT
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GENERAL INFORMATION
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CUSTOMER
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─ The customer finances the interventions with equity capital or through third Party Financing, accept the “credit risk─ For the duration of the contract, receives 100% of the savings achieved─ The customer pays a fixed fee for the services of the ESCO |
ESCO
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─ ESCO finds and organises the financing─ ESCO guarantees a minimum energy savings agreed with the customer─ Accept only the risk to the guaranteed performance “tecnical risk” |
BANK
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─ The Bank finances the Custumer if not use the equity |
SWOT ANALYSIS
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STRENGTHS
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─ Garanted savings for Public Administration─ The Public Administration assume a financial risk related through adequate coverage |
WEAKNESSES
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─ The model requires financial resources by the Public Administration─ Financial risk for the loan that the Public Administration should require a third |
OPPORTUNITY
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─ The contractual conditions can be modeled so there is no uncertainty for Public Administration in the ability to repay the loan─ There are a lot of tools to ensure the expected savings (insurance, project bonds, etc.) |
THREATS
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─ Difficulty in raising the necessary capital on the market, because of their limited availability and high interest rates, combined with the Stability Pact which brakes the Public Administrations who want to participate with their capital to energy efficiency measures─ Volatility of the energy market─ Capacity of the ESCo to refund the Public Administration to repay the debt─ Difficulties obtaining financing and incentives especially for small projects that require aggregations |
LEARN MORE
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http://iet.jrc.ec.europa.eu/energyefficiency/european-energy-service-companies/energy-performance-contracting |
