ENERGY SERVICE PERFORMANCE CONTRACTSEnergy Service Performance Contracts • March 23rd, 2018
An ESPC is an agreement between an end user and an Energy Service Company (ESCO) that guarantees that the energy savings from the energy efficiency upgrade will finance the initial capital cost of the project over the course of the project. It thus captures future energy savings from a retrofit project in order to finance the initial capital cost. Most importantly, it transfers the financial and technical risks associated with a major energy efficiency upgrade to a third party.
