New Directions in Measurement and Verification for Performance Contracts

Over the decades, the determination of energy savings in performance contracting has undergone an evolution from a utility bill based approach towards a more limited exercise which may sometimes be difficult to relate to actual energy savings in the later years of the contract. These limited measurement and verification (M&V) approaches can reduce the value of performance contracting in the customer’s mind, and ultimately hurt the industry. The authors propose a new strategy of determining energy savings which combines the original utility bill based approach with a retrofit isolation approach and annual re-commissioning. This combined approach should address the customers’ need to more easily understand how energy savings are determined, the ESCOs’ need to reduce risk from increases in customer energy usage behavior which can decrease measured savings, and should help sustain energy savings over the length of the guaranteed savings period.

New Directions in Measurement and Verification for Performance Contracts

https://www.abraxasenergy.com/wp-content/uploads/2013/12/NEW-DIRECTIONS-IN-MEASUREMENT-AND-VERIFICATION-FOR-PERFORMANCE-CONTRACTS.pdf