FINANCIAL MECHANISMS SUPPORTING LOW CARBON TOURISMFinancing Carbon Reduction with Energy Performance Contracting

Dr. Peter HugManaging Directoreu.ESCOEuropean Association of Energy Service CompaniesDiamant BuildingBlvd. A. Reyers 801030 BrusselsBelgiumwww.euESCO.org

FINANCIAL MECHANISMS SUPPORTING LOW CARBON TOURISMFinancing Carbon Reduction with Energy Performance Contracting

Dr. Peter HugManaging Directoreu.ESCOEuropean Association of Energy Service CompaniesDiamant BuildingBlvd. A. Reyers 801030 BrusselsBelgiumwww.euESCO.org

1 € spent on more efficient energy useavoids 2 € in investment in energy supply

Source: IEA

Where should you focus?

Supply Side Demand Side

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The greenest energy is the energy that isn’tgenerated

What is an Energy Performance Contract?

A partnership betweena customer and anenergy services company (ESCO)that allows the customerto improve the demand- side energyefficiency of their facilities without anyup-front capital costs or special loans

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A partnership betweena customer and anenergy services company (ESCO)that allows the customerto improve the demand- side energyefficiency of their facilities without anyup-front capital costs or special loans

Using wasted energy to fund risk free carbon and energyreduction

1. Upgrade your buildings with modern,energy efficient equipment… with noimpact on current operational budgets

2. Reduce building energy consumptiontypically by over 20% … withoutadditional investment

3. Meet your carbon emissons targets…at no additional cost

4. Make major improvements… withoutthe need for up front capital

What an Energy Performance Contractenables you to...

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1. Upgrade your buildings with modern,energy efficient equipment… with noimpact on current operational budgets

2. Reduce building energy consumptiontypically by over 20% … withoutadditional investment

3. Meet your carbon emissons targets…at no additional cost

4. Make major improvements… withoutthe need for up front capital

The EPC programme money is already in your budget,currently paying for wasted energy

Why use EPC?

1. Completely self funding

2. Guarantee transfers financial and equipment performance risk tothe ESCO – if the savings target isn’t made, the ESCO pays thedifference

3. Immediate improvements are made• Buildings upgraded with modern, reliable energy efficient equipment• Comfort conditions are improved for occupants• Carbon reduction• Improvement path for CRC benefits

4. No need for additional personnel5. Creates job opportunities6. Proven process

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1. Completely self funding

2. Guarantee transfers financial and equipment performance risk tothe ESCO – if the savings target isn’t made, the ESCO pays thedifference

3. Immediate improvements are made• Buildings upgraded with modern, reliable energy efficient equipment• Comfort conditions are improved for occupants• Carbon reduction• Improvement path for CRC benefits

4. No need for additional personnel5. Creates job opportunities6. Proven process

Energy /UtilityCost

EPC – How the funding works

EnergyandO&MCosts

€Savingscontinue

Energy savingsfund the

improvementprogramme

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Energy /UtilityCost

Current

EnergyandO&MCosts

Yourannualcoststoday

During EPC Programme

Energy /UtilityCost

EnergyandO&MCosts

Energy savingsfund the

improvementprogramme

YourannualcostsduringEPC

After EPC Programme

EnergyandO&MCosts

YourannualcostsafterEPC

EPC is a 4 stage process

Contractclosure

Changes inenergy useaccountingPreliminary

study

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Preliminaryaudit

Detailedanalysis Implementation Guarantee

phase

Detailedengineering

design

Planning,installation,

projectmanagement

Energy SavingGuarantee

measurement &verification service

(IPMVP)

A total facility approach

Lighting replacement,control systems &

LEDs

BuildingManagement SystemsVentilation fans Damper control

Solar gainminimization

A programme approach accessing over250 energy conservation measures

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On-Site Technical ResourceManagement

Chillerupgrade/replacement& absorption cooling

Zonetemperature

control

Boiler upgrades, controlsCombined Heat & Power

VSD motor controlHigh efficiency motors

Voltage reduction

Plug loadmanagement

A programme approach accessing over250 energy conservation measures

Energy efficiency is theunseen elephant in the room

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References – Building Automation

Boutique Hotel Stadthalle Vienna, AT Customer requirementsPresenting a zero-energy balance withintwelve months.

Solution130 m2 solar thermal system is used for freshair preheating for ventilation and water heating.The necessary air exchange is realizedthrough a residential ventilation system with ≥90% heat recovery.

Customer benefitA building management system controllersand Web – operation as flexible measurementand control technology for heating andventilation, regulation, concrete coreactivation, water heating, solar panel systemand buffer management.Building automation (2011)

Customer requirementsPresenting a zero-energy balance withintwelve months.

Solution130 m2 solar thermal system is used for freshair preheating for ventilation and water heating.The necessary air exchange is realizedthrough a residential ventilation system with ≥90% heat recovery.

Customer benefitA building management system controllersand Web – operation as flexible measurementand control technology for heating andventilation, regulation, concrete coreactivation, water heating, solar panel systemand buffer management.

References – Energy Efficiency

Hotel Excelsior, Hong Kong Customer requirementsRenovation and modernization and optimizeenergy efficiency.

Solution Chillers upgrade for efficiency enhancement Chilled Water Pumps & Condensing Water

Pumps upgrade for better cooling load Building Automation system upgrade Cooling Plant optimization Energy Monitoring System for measurement

and verification

Customer benefit Increase cooling capacity to serve extra

cooling load after hotel’s renovation Hotel group’s energy efficiency plan No interruption to operation during retrofitEnergy efficiency (2011)

Customer requirementsRenovation and modernization and optimizeenergy efficiency.

Solution Chillers upgrade for efficiency enhancement Chilled Water Pumps & Condensing Water

Pumps upgrade for better cooling load Building Automation system upgrade Cooling Plant optimization Energy Monitoring System for measurement

and verification

Customer benefit Increase cooling capacity to serve extra

cooling load after hotel’s renovation Hotel group’s energy efficiency plan No interruption to operation during retrofit

References – Energy Efficiency

Lindner Hotels, DE Customer requirementsThe hotel planned to cut its energyconsumption by at least 10% through zero-investment and investment measures with apayback period of less than one year.

SolutionFollowing a thorough analysis of all buildingsystems, Siemens upgraded the heating,ventilation, and air-conditioning systems aswell as the lighting of the eight buildings withina year as a part of Energy Saving PerformanceContracting.

Customer benefitReduction of energy costs by a contractuallyguaranteed total of 3.6 million euros per year,and CO2 emissions are reduced by 19,000 t.Energy efficiency (2011)

Customer requirementsThe hotel planned to cut its energyconsumption by at least 10% through zero-investment and investment measures with apayback period of less than one year.

SolutionFollowing a thorough analysis of all buildingsystems, Siemens upgraded the heating,ventilation, and air-conditioning systems aswell as the lighting of the eight buildings withina year as a part of Energy Saving PerformanceContracting.

Customer benefitReduction of energy costs by a contractuallyguaranteed total of 3.6 million euros per year,and CO2 emissions are reduced by 19,000 t.

Dr. Peter HugManaging Directoreu.ESCOEuropean Association of Energy Service CompaniesDiamant BuildingBlvd. A. Reyers 801030 BrusselsBelgiumwww.euESCO.org