Energy Performance Contracts

Energy Performance Contracts (EPCs) are agreements between an energy service company (ESCO) and a customer that guarantee energy savings over a specified period of time. These contracts are typically structured so that the customer pays the ESCO a fixed fee for energy-efficiency improvements, and the ESCO is then responsible for delivering the energy savings. The ESCO is typically paid out of the energy savings achieved, and the customer is guaranteed that the energy savings will exceed the cost of the improvements. EPCs are often used to finance energy efficiency projects in buildings, industrial processes, and other energy-consuming activities. They provide an incentive for energy efficiency improvements by reducing the risk of investing in energy efficiency projects, and they also provide a way for customers to finance energy efficiency projects without having to use up their own capital. EPCs are an attractive option for customers who want to reduce their energy costs, reduce their carbon footprint, and improve their overall energy efficiency.