How to solve a problem like EPCs?

While there has been some notable progress in the public sector EPC market, the critical combination of technical, financial, commercial and contractual elements has not yet been achieved. To drive the Energy Performance Contract (EPC) market towards its substantial potential a meeting of energy service company specialists and the professionals who support them is to be held in the City of London on the 27th June.

Organised by the Energy Performance Contracting Group of trade association ESTA, the meeting is aimed at EPC service providers, financiers and lawyers at Macquarie Bank to explore the current EPC market and identify barriers and solutions.

On one hand energy reduction projects are often stalled by lack of finance, despite the return being well within normal investment criteria, or by lack of project expertise even though the projects are within the technical capability of service providers. On the other hand widely available funding for energy reduction suffers from a lack of suitable projects.

To resolve this paradox the EPC route brings together project opportunities with finance and technical support. However, while the sector has become substantial – valued in billions – it remains well short of its enormous potential as quantified since the 1970s.

The ESTA Energy Performance Contracting Group provides a forum for development and a common voice for policy makers. Nick Keegan’s article (see EiBi February 2016 page 24) set out the aims of the group and its approach, including a series of planned meetings to bring together the wide range of professionals who support energy performance contracting.

The first meeting is designed to take this forward and consider questions raised by developments in the current market.

The EPC contract frameworks have been a major reason for progress in the public sector. RE:FIT, the Carbon and Energy Fund and Essentia have hundreds of projects and billions of pounds total investment with recent further development in the Scottish market. Are frameworks the only solution for widespread use and are there gaps that they do not cover?

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