ENERGY PERFORMANCE CONTRACT (EPC)


Energy performance contract (EPC) is a business model with which the measures for effective energy consumption are financed by the contractor and paid for from the achieved target savings in costs for consumed energy. If certain conditions are met, the use of the principle in the public sector is not considered as public contracting authority borrowing.

The measures are implemented by the contractor at their own expense. The invested funds are returned via sharing of the saved expenditure for consumed energy (image). In the preparation stage, the contractor plans and implements the measures for energy savings. This is followed by the main stage of the contractual relationship that encompasses the refinancing of the investment input with savings on expenditure for energy. In most cases, the contracting authority receives financial benefits from the start of the main stage. And, after the expiry of the contractual period, the savings on expenditure for energy are entirely their own. The usual duration of the contracting period is between 5 and 15 years.

The business model is used to perform renovation of energy systems in buildings, for renovating indoor and public lighting and for the optimisation of the operation of district heating and cooling systems as well as other distribution systems and water systems.

Picture: Principle of contracting savings
 

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Petrol d.d.
Pot na Lisice 7, 4260 Bled, Slovenia
T +386 4 575 30 00
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E marketing.eltec@petrol.si
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