Energy Performance Contracting

Energy Performance Contracting (EPC) is a type of contract that enables businesses to improve their energy efficiency without upfront capital costs. It is a contractual agreement between an energy service company (ESCO) and a customer, in which the ESCO agrees to provide energy-saving services, such as energy audits, energy efficiency retrofits, and energy management systems, and the customer agrees to pay for the services based on the energy savings they generate. The ESCO guarantees that the energy savings will be greater than the cost of the services, so the customer is able to make energy efficiency improvements without any upfront costs. The ESCO is then paid from the energy savings generated, allowing the customer to realize a return on their investment. This type of contract is beneficial for both parties, as it allows the customer to improve their energy efficiency while the ESCO is able to make a profit from the energy savings generated.