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Article
Publication date: 5 April 2013

Maria Garbuzova‐Schlifter and Reinhard Madlener

The Russian Energy Service Company (ESCO) market emerges rapidly due to the new energy efficiency legislation that has been implemented since 2009. However, a clear identification…

Abstract

Purpose

The Russian Energy Service Company (ESCO) market emerges rapidly due to the new energy efficiency legislation that has been implemented since 2009. However, a clear identification of the Russian ESCOs, comparable to those operating on the basis of Energy Performance Contracting (EPC) in the Western markets, remains rather difficult. Hence, aside from the independent ESCOs identified, further energy service‐providing companies (ESPCs) are within the scope of this survey. This paper aims to address these issues.

Design/methodology/approach

Building on comprehensive qualitative research of the international and Russian academic and non‐academic literature on the ESCO concept and an expert interview, an explorative, questionnaire‐based survey among 161 Russian energy companies and organizations was conducted. A total of 28 usable responses were returned, corresponding to a response rate of 17 per cent. Non‐parametric exact tests are used for the statistical analysis.

Findings

The authors' findings show that only nine of the surveyed ESCOs have acquired energy performance‐based projects. In line with the new energy efficiency legislation, such projects are strongly supported in the state sector but much less so in the commercial sector. Most of the projects are financed either through ESCOs' own funds, direct loans to customers, or by the customers themselves. Russian banks, however, rarely provide direct loans for energy performance‐based projects of ESCOs, but rather prefer to offer financial leasing contracts. The contractual form “guaranteed savings”, which is generally more applicable in mature ESCO markets, is gaining in importance, while “shared savings” is barely used.

Originality/value

This paper delivers, to the best of the authors' knowledge, the first systematic empirical investigation of the Russian ESCO industry, taking into account experiences from the international ESCO markets.

Details

International Journal of Energy Sector Management, vol. 7 no. 1
Type: Research Article
ISSN: 1750-6220

Keywords

Article
Publication date: 1 September 2006

Konstantinos D. Patlitzianas, Haris Doukas and John Psarras

To contribute to the design of the energy service companies (ESCOs)' environment in the Mediterranean countries, mainly focusing on the constraints this company's environment face…

Abstract

Purpose

To contribute to the design of the energy service companies (ESCOs)' environment in the Mediterranean countries, mainly focusing on the constraints this company's environment face and the actions that can fulfil its needs and aims, taking also into consideration the opportunities and threats emerging from the energy liberalization and climate change.

Design/methodology/approach

The methodology that was followed (based in a large part on the context of two projects targeted to the Mediterranean region and funded by the European Commission) incorporated four steps, the desk analysis for energy efficiency potential in the Mediterranean, the data collection, the assessment of the constraints and the final assessment of the ESCOs' environment.

Findings

Provides information regarding the current status of ESCOs' development, in the dimensions of the ESCOs' environment (political/legal, economical/financial, social/cultural and technological), both in the European Union (EU) (Cyprus, France, Greece, Italy, Malta and Spain) and non‐EU (Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Syria, Tunisia and Turkey) Mediterranean countries.

Originality/value

There are no papers investigating the activation environment of ESCOs in a coherent and integrated way in the Mediterranean. This paper provides to decision makers a supportive framework for policy design and formulation of policy priorities for ESCOs development in the region.

Details

Management of Environmental Quality: An International Journal, vol. 17 no. 5
Type: Research Article
ISSN: 1477-7835

Keywords

Article
Publication date: 5 May 2015

Giulia Nardelli, Jesper Ole Jensen and Susanne Balslev Nielsen

The purpose of this article is to investigate how facilities management (FM) units navigate Energy Service Company (ESCO) collaborations, here defined as examples of public…

Abstract

Purpose

The purpose of this article is to investigate how facilities management (FM) units navigate Energy Service Company (ESCO) collaborations, here defined as examples of public collaborative innovation within the context of FM. The driving motivation is to inform and inspire internal FM units of local institutions on how to navigate and manage collaboration of different, intra- and inter-organisational actors throughout ESCO projects.

Design/methodology/approach

A deductive research methodology was applied based on the first ten ESCO projects in Danish municipalities between 2008 and 2012.

Findings

A model of FM roles in FM public innovation is proposed. The internal FM unit coordinates between clients and end users by acting as translator and demonstrator and collaborates with the ESCO company to implement the energy renovation (FM processor).

Research limitations/implications

The data were collected from a limited sample of ESCO collaborations in Denmark. Future research should thus investigate collaborative innovation in ESCO (and other forms of private–public) collaborations outside of Denmark.

Practical implications

Not only should FM units clarify what different stakeholders expect from an ESCO collaboration, but also they should translate stakeholders’ expectations into actual goals and objectives; process them together with the ESCO company; demonstrate their execution to all stakeholders throughout the process, not just when closing the collaboration.

Originality/value

This paper contributes to FM innovation research by exploring FM innovation in the public sector and by depicting the coordinating role of local governments’ internal FM units engaging in public–private collaborative innovation.

Details

Journal of Facilities Management, vol. 13 no. 2
Type: Research Article
ISSN: 1472-5967

Keywords

Article
Publication date: 1 July 2014

Pan Lee, Tsun Ip Lam and Ren Jye Dzeng

The purpose of this paper is to investigate the current market development of Energy Performance Contracting (EnPC) in Hong Kong and Taiwan, focussing on four key aspects: first…

Abstract

Purpose

The purpose of this paper is to investigate the current market development of Energy Performance Contracting (EnPC) in Hong Kong and Taiwan, focussing on four key aspects: first, the potential building energy retrofits as an investment for future savings; second, the motivations for building owners toward the use of EnPC; third, the reasons for building owners not using EnPC; and fourth, the different approaches of Hong Kong and Taiwanese governments toward the promotion of EnPC.

Design/methodology/approach

A dual-questionnaire survey was conducted both in Hong Kong and Taiwan, where the same set of questionnaire was sent to the key personnel of the energy services companies (ESCOs) in both regions as identified from the latest member lists of representative trade associations, supplement with 11 structured interviews.

Findings

Apart from explainable differences, the results show the top rankings by the respondents of Hong Kong and Taiwan as follows: “Potential retrofit works” including lighting replacement with efficient fluorescent and light emitting diode lamps and improvement of air-con system. “EnPC Motivations” including owners’ lack of upfront capital and use of energy savings for other purposes may yield better returns; ESCOs’ provision of turnkey services. “Reasons not considering EnPC” including worry about its complexities; lack of familiarity with EnPC and long payback periods. As for promotional efforts for EnPC, the Taiwan government has taken more initiatives to foster its use both technically and financially.

Practical implications

This study identifies market-related motivators and deterrents as experienced by ESCOs in implementing EnPC projects in two developed Asian economies.

Originality/value

This study provides insightful information for the stakeholders about the latest market development of EnPC in Hong Kong and Taiwan.

Details

Journal of Property Investment & Finance, vol. 32 no. 4
Type: Research Article
ISSN: 1463-578X

Keywords

Article
Publication date: 1 January 2006

Joshua M. Pearce and Laura L. Miller

This paper aims to quantify and critically analyze the best practices of a comprehensive environmental stewardship strategy (ESS), which included a guaranteed energy savings…

1952

Abstract

Purpose

This paper aims to quantify and critically analyze the best practices of a comprehensive environmental stewardship strategy (ESS), which included a guaranteed energy savings program (GESP) that utilized an energy service company (ESCO).

Design/methodology/approach

The environmental and economic benefits and limitations of an approach utilizing an ESCO are critically analyzed in the context of implementing a comprehensive university sustainability strategy.

Findings

A GESP, which utilized the technical and financial expertise of energy service companies, improved the operational efficiency, decreased the ecological footprint, and reduced the operating costs of the university.

Practical implications

Energy‐saving projects are “win‐win” situations, addressing both economy and ecology. Utilizing energy service companies in the university setting is a useful method to catalyze university administration to support sustainability initiatives and accelerate the implementation of comprehensive sustainability strategies.

Originality/value

The current waste rampant at most universities provides a large number of opportunities to improve environmental stewardship while reducing operating costs. This paper provides a new model utilizing energy service companies to capitalize on these opportunities to move universities towards sustainability.

Details

International Journal of Sustainability in Higher Education, vol. 7 no. 1
Type: Research Article
ISSN: 1467-6370

Keywords

Article
Publication date: 3 October 2016

Patrick T.I. Lam and Jack S. YU

The purpose of this paper is to demonstrate the growing trend of developing and managing photovoltaic facilities owned by third parties in buildings, as a possible alternative to…

Abstract

Purpose

The purpose of this paper is to demonstrate the growing trend of developing and managing photovoltaic facilities owned by third parties in buildings, as a possible alternative to energy performance contracting.

Design/methodology/approach

Based on an established business model template, analysis is carried out on the framework of using third-party finance in the provision of photovoltaic facilities in buildings. Case studies in the USA and China enable comparison of policy tools enabling this approach.

Findings

While barriers exist in the common energy performance contracting approach for renewable installations owned by the building owner, vesting photovoltaic equipment with a third party for a certain period has become a viable business alternative as long as revenue is generated through a power purchase agreement or lease arrangement with the building owner.

Research limitations/implications

The third-party ownership business model works better if sufficient policy incentives exist alongside the revenue brought about by renewable energy. Hence, governments have to create the right environment.

Originality/value

Win-win situations have been identified through case studies in countries with burgeoning renewable energy use in buildings, notably the USA and China, giving new insights on facilities management.

Details

Facilities, vol. 34 no. 13/14
Type: Research Article
ISSN: 0263-2772

Keywords

Article
Publication date: 18 September 2019

M.F.F. Fasna and Sachie Gunatilake

Despite their energy conservation potential, still existing buildings are slow in embracing building energy efficiency retrofits (BEER), mainly because of the absence of a clearly…

Abstract

Purpose

Despite their energy conservation potential, still existing buildings are slow in embracing building energy efficiency retrofits (BEER), mainly because of the absence of a clearly defined process to deliver the BEER projects, and the lack of proactive guidance for project teams. Further, the identification of factors that can facilitate BEER projects is also important to ensure the project success. This is particularly true in energy service company (ESCO)-led projects. Hence, this study aims at investigating the decision-making process, including the motivators for the successful execution of each stage in implementing BEER when projects are outsourced to a third party.

Design/methodology/approach

An in-depth case study was carried out to investigate the decision-making process and motivators in implementing BEER in a selected hotel building. Seven semi-structured interviews were conducted to collect the required data within the case.

Findings

Study disclosed the 13 key decisions made and 37 key activities performed in each stage of the project. A total of 19 motivators for the successful execution of the respective stages were also elicited. Ultimately, the research findings are mapped against the five key stages of BEER decision-making process.

Originality/value

The outcome of this study will provide the industry practitioners a basis for the effective adoption and implementation of BEER in existing hotel buildings when an external contractor is involved.

Details

Journal of Facilities Management , vol. 17 no. 4
Type: Research Article
ISSN: 1472-5967

Keywords

Open Access
Article
Publication date: 4 July 2022

Shiyu Wan, Yisheng Liu, Grace Ding, Goran Runeson and Michael Er

This article aims to establish a dynamic Energy Performance Contract (EPC) risk allocation model for commercial buildings based on the theory of Incomplete Contract. The purpose…

1490

Abstract

Purpose

This article aims to establish a dynamic Energy Performance Contract (EPC) risk allocation model for commercial buildings based on the theory of Incomplete Contract. The purpose is to fill the policy vacuum and allow stakeholders to manage risks in energy conservation management by EPCs to better adapt to climate change in the building sector.

Design/methodology/approach

The article chooses a qualitative research approach to depict the whole risk allocation picture of EPC projects and establish a dynamic EPC risk allocation model for commercial buildings in China. It starts with a comprehensive literature review on risks of EPCs. By modifying the theory of Incomplete Contract and adopting the so-called bow-tie model, a theoretical EPC risk allocation model is developed and verified by interview results. By discussing its application in the commercial building sector in China, an operational EPC three-stage risk allocation model is developed.

Findings

This study points out the contract incompleteness of the risk allocation for EPC projects and offered an operational method to guide practice. The reasonable risk allocation between building owners and Energy Service Companies can realize their bilateral targets on commercial building energy-saving benefits, which makes EPC more attractive for energy conservation.

Originality/value

Existing research focused mainly on static risk allocation. Less research was directed to the phased and dynamic risk allocation. This study developed a theoretical three-stage EPC risk allocation model, which provided the theoretical support for dynamic EPC risk allocation of EPC projects. By addressing the contract incompleteness of the risk allocation, an operational method is developed. This is a new approach to allocate risks for EPC projects in a dynamic and staged way.

Details

International Journal of Climate Change Strategies and Management, vol. 15 no. 4
Type: Research Article
ISSN: 1756-8692

Keywords

Article
Publication date: 28 May 2020

M.F.F. Fasna and Sachie Gunatilake

The success of energy retrofits (ER) projects is highly dependent on the involvement of right stakeholders at the right stage. So far, little insight is available from previous…

Abstract

Purpose

The success of energy retrofits (ER) projects is highly dependent on the involvement of right stakeholders at the right stage. So far, little insight is available from previous literature on the involvement of different stakeholders during various stages of the ER decision-making process, and their roles and functions in the respective stages. This is specifically true in the context of Energy Service Company (ESCO) led ER projects, which is an emerging trend in the current context. Hence, this paper aims to investigate the roles and functions of stakeholders during different stages of an ESCO-led ER project in the hotel sector.

Design/methodology/approach

An in-depth case study was conducted in a selected hotel building to gain insights into the roles and functions of stakeholders throughout the project stages. To collect the required data, face-to-face semi-structured interviews were conducted with seven selected respondents within the case.

Findings

The study identified nine key stakeholders that were involved during five different project stages along with their functions. Based on these identified functions, four main roles (i.e. decision-maker, performer, monitor/observer, and supporter) emerged that were reflective of the nature of the stakeholders' involvement in different stages of the decision-making process. Owner/client, facilities manager (FM), ESCO and architect attached to ESCO emerged as the key “decision-makers” during project implementation process.

Originality/value

The outcomes of this research would be useful in ensuring the proactive involvement of all the identified stakeholders in respective project stages of ESCO led ER projects in the hotel sector.

Details

International Journal of Building Pathology and Adaptation, vol. 38 no. 5
Type: Research Article
ISSN: 2398-4708

Keywords

Article
Publication date: 4 April 2016

Alberto De Marco, Giulio Mangano, Fania Valeria Michelucci and Giovanni Zenezini

The purpose of this paper is to suggest the usage of the project finance (PF) scheme as a suitable mechanism to fund energy efficiency projects at the urban scale and present its…

Abstract

Purpose

The purpose of this paper is to suggest the usage of the project finance (PF) scheme as a suitable mechanism to fund energy efficiency projects at the urban scale and present its advantages and adoption barriers.

Design/methodology/approach

A case study is developed to renew the traffic lighting system of an Italian town via replacement of the old lamps with new light-emitting diode (LED) technology. Several partners are involved in the case project to construct a viable PF arrangement.

Findings

The case study presents the viability of the proposed PF scheme that provides for acceptable financial returns and bankability. However, it also shows that the need for short concession periods may call for a public contribution to the initial funding to make the project more attractive to private investors.

Practical implications

This case study is a useful guideline for governments and promoters to using the PF arrangement to fund energy efficiency investments in urban settings. It helps designing an appropriate PF scheme and understanding the advantages of PF to reduce risk and, consequently, increase the debt leverage and profitability of energy efficiency projects.

Originality/value

This paper contributes to bridging the gap about the lack of works addressing the implementation of the PF mechanism in the energy efficiency sector in urban areas. The importance of this paper is also associated with the shortage of traditional public finance faced by many cities that forces to seek for alternate forms of financing.

Details

International Journal of Energy Sector Management, vol. 10 no. 1
Type: Research Article
ISSN: 1750-6220

Keywords

1 – 10 of 94